Graco to relocate HQ from Minneapolis to northwest suburbs

Graco will leave Minneapolis in two years and build a new headquarters in the northwest metro, company officials announced Wednesday.

The news caught city officials by surprise.

“This is a big announcement to the city. This is consequential,” said Erik Hansen, community and economic development director for the city of Minneapolis. “We would love to have them stay in Minneapolis, because they helped build the city. And manufacturing is pretty scarce. It’s unfortunate because we need all types of jobs in the city.”

As many as 800 employees worked at Graco’s Minneapolis campus as recently as 2021. But that number has declined and now stands at just 400, the company said.

Graco has spent millions building a host of new factories and distribution centers in Anoka, Dayton and Rogers in the northwest metro. The new headquarters building will be in Dayton or Rogers, the company said.

“The decision to consolidate our operations and offices in the northwest metro positions us for continued growth while fostering greater collaboration and operational synergy,” said Graco CEO Mark Sheahan in a statement. “As we continue to grow and evolve globally, we’ve taken a thoughtful look at how best to align our Minnesota facilities to maximize manufacturing capacity.”

Graco expanded its Minneapolis campus several times over three decades, sometimes with the help of city tax increment financing.

But over the years, Graco officials sometimes grumbled privately over now-solved spats, including with the Minneapolis Park Board over expansion plans and river easements.

The move to the suburbs will not be overnight.

Graco — which is well known for manufacturing paint sprayers, insulation sprayers and food-handling equipment that pumps tomato sauce into cans and peanut butter into Reese’s cups — said it plans to “gradually exit its Riverside campus” over the next two years.

“The company will begin the process of preparing the campus for sale as part of this transition,” Sheahan said.

Graco bought its Dayton acreage in 2021 and quickly began construction. Today, the property has more than 225 factory workers, 100 acres and 1 million square feet of plant space in the French Lake Industrial Center.

In 2019, Graco spent $73 million to double the size of its David A. Koch Center in Rogers. It now boasts nearly 800,000 square feet in that city.

The Rogers, Dayton and Anoka facilities not only have 1,300 workers combined but those factories all ”are newer, more modern facilities that are highly efficient and better equipped,“ said spokeswoman Kirstie Foster in explaining the decision to move from the Minneapolis facilities.

”This move brings our manufacturing operations, engineering and corporate teams closer together to improve efficiency and foster greater collaboration," Foster said.

Graco has operations in 12 countries and sells products in more than 100 countries worldwide.