VIDEO: Wanted: Rooms to rentThe demand comes from a surge of jobs in this Pennington County city of about 9,000, with most of the employment growth coming at Digi-Key, an electronic components distributor.
By: Ryan Bakken, Grand Forks Herald
THIEF RIVER FALLS — During their first month working at Digi-Key, Tim and Sandra Robinson commuted together from Warroad, a round trip of three hours.
To make it worse, they didn’t work the same shift. The wait added four hours to their time away.
“It was not fun,” Sandra said.
About a month ago, they found a rental opening in neighboring St. Hilaire through a friend of a friend.
“It’s nice,” Sandra said, “because it only takes me 10 minutes to get to work now.”
The Robinsons aren’t alone in having a prolonged search for convenient lodging here, where supply has fallen woefully short of demand.
The demand comes from a surge of jobs in this Pennington County city of about 9,000, with most of the employment growth coming at Digi-Key, an electronic components distributor.
Going from 1,000 jobs and $356 million in annual sales 10 years ago to 2,560 jobs and $1.5 billion in sales today, the company’s growth draws comparisons to western North Dakota’s oil boom. It’s also shares one of oil country’s complications — a housing shortage.
More specifically, the shortage is in apartments with rents that will mesh with the pay scale of the vast majority of Digi-Key workers, who start at $12.18 per hour. Most of its workers fall into two categories — those who take telephone sales orders and the “pickers-and-packers” who collect the components for the orders and package them.
“We would like to see all different types of housing developed in Thief River Falls, but that entry rental housing is our greatest need,” said Rick Trontvet, Digi-Key vice-president for human resources.
“Entry apartment rentals are the greatest need expressed by our candidates. We have seen people turn down offers because they conclude that they can’t find suitable housing.
“And, if housing is a barrier, it’s more difficult for them to have a good experience after work.”
The problem is ongoing because Digi-Key’s growth is ongoing. The company anticipates adding another 60 jobs this year.
It offers a $500 relocation allowance for new hires. “It’s one of the carrots we put out there,” Trontvet said.
Commuting to work
The Robinsons came from New Mexico, learning about the jobs opportunity from relatives living in Warroad. Sarah Ellison, a single 24-year-old, came from Grand Rapids, Minn., where she said jobs are scarce.
After more than a month’s search, she found a rental in Newfolden, Minn., 17 miles from work.
“Except for those overpriced or small, there was nothing in Thief River Falls,” she said. “They are asking $450 for a one-room apartment. When I heard of the opening in Newfolden, I figured I’d better take it right away.”
Ellison is keeping her eyes and ears open for options in TRF, however.
“I’d like living in town, especially with the price of gas,” she said. “I’d rather be closer to work in case something goes wrong with my vehicle.”
Help on the way
Mike Moore, the city’s economic development director, said there’s hope. Out-of-town developers have pending purchase agreements for land, making it promising for apartment construction this year.
“At a minimum, we should have 60 more units this year,” Moore said. “The maximum would be 100. We’d like to see them phased in so a developer doesn’t get into a cash-flow issue to start.
“Apartments are not a great investment. They’re not bad, with a yield somewhere between 7 and 12 percent. But there’s also a significant risk.”
He said 150 units built over several years would “take care of a lot of the demand.”
Mayor Steve “Beaver” Nordhagen said the city’s population hasn’t grown, even with dramatic job growth of Digi-Key and a more modest growth of other businesses. Many workers in TRF — including more than 1,000 employed at Digi-Key — choose to live in the neighboring towns.
“That means we have to offer more things to do, such as more restaurants and shopping, Nordhagen said.
Homes needed, too
Although not as big of a shortage as apartments, there’s also a need for more houses on the market, according to Brian Fay.
Brian and wife Teresa grew up in Baudette, Minn., and lived in Rochester, Minn., before Teresa accepted an x-ray technician job at Sanford Health in Thief River Falls. Brian then landed a sales job with Digi-Key.
This week, they will move into a home they purchased. “Homes to buy are few and far between if you want to stay in the city limits,” Brian said.
“We wanted to buy in the $120,000 to $130,000 range, but there was nothing so we had to go to the $160,000 range. It isn’t everything we want, but it will do for now.”
The alternative, he said, would have been scrambling to find another place to live.
Reach Bakken at (701) 780-1125; (800) 477-6572, ext. 125; or send e-mail to email@example.com.