Climate by Design International is planning a new facility in Owatonna’s industrial park, doubling the size of what they currently occupy in three separate areas around town. Tom Peterson, CEO and founder of CDI, said they are still exploring options for what to do with their current main facility on Park Drive once the new building is complete. (Photo courtesy of ISG)

Ron Neubauer and Blake Arett work the laser table at Climate by Design International (CDI) in Owatonna. CDI is an Owatonna-grown manufacturing company, founded by Tom Peterson and his wife, that creates desiccant dehumidifiers and critical process air handlers for a wide array of applications, include ice arenas, hospital surgical suites and food processing facilities. (File photo/southernminn.com)

Some may consider it a problem, but as Tom Peterson looks around his business that is quite literally bursting at the seams, he only sees opportunity.

Climate by Design International is planning a new facility in Owatonna’s industrial park, doubling the size of what they currently occupy in three separate areas around town. Tom Peterson, CEO and founder of CDI, said they are still exploring options for what to do with their current main facility on Park Drive once the new building is complete. (Photo courtesy of ISG)

"We have a total of about 100,000 square feet and a lot of outdoor storage," Peterson said, as he discussed the multiple locations where one can find Climate By Design International (CDI). The manufacturing company founded by Peterson and his wife creates desiccant dehumidifiers and critical process air handlers for a wide array of applications, including ice arenas, hospital surgical suites and food processing facilities.

Aside from the 66,000-square-foot facility on Park Drive, where a majority of the operations occur, Peterson said they are also currently leasing a 30,000-square-foot facility on State Avenue and have some storage at the Owatonna Area Business Development Center.

Still, there just isn't enough room for the homegrown business that currently staffs about 150 individuals. 

So Peterson has decided to build.

During the Owatonna City Council meeting Jan. 4, the council unanimously approved a public hearing date to establish a Tax Increment Financing (TIF) district for the development of a new CDI manufacturing facility on Bridge Street. The new facility will be 200,000 square feet and be located east of the Owatonna Energy Station, near the new Bosch warehouse in Industrial Park.

Councilor Nate Dotson was not in attendance for the meeting and therefore did not vote.

Aside from running out of room in their current facilities, Peterson said there has been "very significant growth opportunities" involving several of the markets CDI is involved in rapidly growing.

"One of those markets is in lithium battery manufacturing, which are the batteries used in electric vehicles," Peterson said, adding that major car manufacturers, including Ford, have recently announced increased lithium battery needs in their future. "We have done an awesome job of keeping the areas of the building dry enough over the lithium, so that is a very large growth segment for us."

Another market that has provided CDI an opportunity to grow is in Canada's ice arenas. According to Peterson, a new national initiative has been rolled out for our neighbors to the north that will require ice arenas to reduce their energy by 50%. Peterson said CDI has been able to develop a new product to help them meet that goal.

"Being in business 30 years, getting name recognition like this across all industries in the U.S. and beyond is great," Peterson said.

Having these opportunities to grow, the company could likely move anywhere in the country. For Peterson and his wife, however, leaving Owatonna was never an option.

Ron Neubauer and Blake Arett work the laser table at Climate by Design International (CDI) in Owatonna. CDI is an Owatonna-grown manufacturing company, founded by Tom Peterson and his wife, that creates desiccant dehumidifiers and critical process air handlers for a wide array of applications, include ice arenas, hospital surgical suites and food processing facilities. (File photo/southernminn.com)

"The employees that we have here and now, we want to honor them by staying here," Peterson said. "Also to honor the community that has been supporting us all these years, including dating back to the original Owatonna Business Incubator [at West Hills]."

"The overall environment of Owatonna suits us quite well and really aligns with Sue and I's personal goals," he continued. "It is a very tight-knit, very giving community, and those are all things that are near and dear to us."

Along with the new facility, CDI will be adding 50 new jobs. Today, however, Peterson said they are already working on adding 25 new positions for their unique night shift, which runs from 8 p.m. to 6 a.m. Peterson said they altered the night shift hours because it is "what the employees desired."

"One of the benefits of being a smaller company is we can really be in-tune with what our employees want," he said. "The reasons they wanted these hours is because then they could be home for dinner with their family and back for breakfast and to see the kids off to school in the morning."

Peterson said CDI is also currently in talks with the Career Pathways coordinator at the Owatonna School District to work on bringing students into the company for an afternoon shift. He said this will make them the first business in Owatonna to have 16- and 17-year-olds in the manufacturing world.

The company is also in the process of rolling out an afternoon shift geared at "semi-retired" individuals, Peterson said, which will allow individuals to work a few hours in the afternoon and be done by 8 p.m. Peterson said he is hopefully this initiative will begin either late January or early next month.

"Essentially, we will be doubling the business over the next three years," Peterson said, noting that this means in staff size and production levels. 

For the city, Peterson's continued investment in growing the company while still remaining local is also an investment in the community.

"Thanks for your commitment to Owatonna," said Councilor Kevin Raney. "This is a huge project."

Despite the pandemic, Owatonna has seen record-breaking years in development within city limits in 2020 and 2021. According to Community Development Director Troy Klecker, the city of Owatonna issued 130 more building permits in 2021 than the year prior, but 2020 was the record breaking year in valuations sitting, breaching $100 million in new construction.

Without the new high school project, which is permitted and reviewed by the state and not the city, Owatonna saw $61 million in new construction in 2021. If the high school project was a part of the city's permit and valuation process, Klecker said the city would have set a new record of $155 million.

"Every year is a little different, construction varies," Klecker said. "The number of permits are there, the number of projects are there, but the valuation depends on the size of the project."

Thanks to CDI, however, Klecker said the city is off to a great start in 2022.

"CDI's announcement of their building — that's a huge industrial project," he said. "Those are the ones that really bring those valuations up. It's a $37 million total investment … Those are the projects that really add value to the community."

Reach Associate Editor Annie Granlund at 507-444-2378 or follow her on Twitter @AnnieGranlund. ©Copyright 2022 APG Media of Southern Minnesota.

Data included is taken from the Minnesota Department of Health Daily reports. Because all data is preliminary, the change in number of cumulative positive cases and deaths from one day to the next may not equal the newly reported cases or deaths.

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