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JOURNAL’S TOP 10 BUSINESS STORIES OF 2019

Top 10 Siouxland business stories of 2019: Big-ticket projects advance, iconic retailers close

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SIOUX CITY -- The key business stories in Sioux City and surrounding communities in 2019 were a mixed bag. 

Some were positive -- large-scale developments in of large swaths of the downtown -- while others, such as the closure of major longtime retailers, were not. 

Below is a list of the 10 biggest business stories of 2019: 

1. Downtown developments

The nearly $15 million Siouxland Expo Center began to rise this year on a parcel of land bounded by Interstate 29 and the Floyd River channel, while two downtown hotels are set to open in the spring. 

The multi-purpose venue, boasting an estimated 85,000 square feet of arena space, is hoped to attract a wide range of activities, from large trade shows to youth sports tournaments. 

The Expo Center is one of several of the big-ticket items are part of the city's Reinvestment District, which is diverting nearly $14 million in future hotel/motel and sales tax money into unique projects designed to increase tourism and quality of life.

Two other major Redevelopment District projects moved closed to completion in 2019. On Historic Fourth Street, a 150-room Courtyard by Marriott Hotel is expected to open this spring. The hotel, which has a $14 to $15 million price tag, will connect to the Convention Center, where over $3 million in related renovations were completed by year's end. 

Hotel and convention center guests and others visitors to downtown will park in a new ramp under construction behind the hotel.

The Redevelopment District also includes Virginia Square, a multi-year project to renovate a series of former industrial buildings in the 100 block of Virginia Street into modern housing and commercial space, and the renovations of the historic Warrior Hotel and the Davidson Building, which are being transformed into new spaces as part of a $73 million project.

An 87-room Avid by IHG hotel is under construction as part of Ho-Chunk Inc.'s Village Square project; it's expected to open early in the year. Restoration St. Louis is leading the redevelopment of the 200,000 square feet of combined space in the Warrior and Davidson into a 148-room Marriott Autograph hotel, luxury apartments, bars, restaurants and other retail outlets. The hotel is expected to open in early summer.

2. Closure of Sears and Shopko

Sioux City's retail trade suffered a pair of blows this year with the closure of Sears, a longtime department store at the Southern Hills Mall, and Shopko on Hamilton Boulevard. 

Sears shuttered its 120,000-square-foot Sioux City store in March. The location had survived numerous rounds of store closures in the years leading up to Sears' bankruptcy, including the first rounds after Sears' October 2018 bankruptcy.

But in late December 2018, the Southern Hills Mall Sears -- the last one in Iowa -- was included on a list of 80 set to close in 2019. Roughly 43 people lost their jobs.

Shopko's parent company, meanwhile, declared bankruptcy at the beginning of the year. At the time of the filing, Shopko was saddled with liabilities of between $1 billion and $10 billion and assets of less than $1 billion. 

Sioux City's Shopko was initially spared the ax, but in March the Wisconsin-based chain announced it would liquidate all its locations. Sioux City's store closed in June.

Surrounding communities, including Cherokee, Estherville, Ida Grove, Onawa and Sheldon, Iowa, and Wayne, Norfolk and West Point, Nebraska, all lost their respective Shopko locations. 

Sioux City's Shopko Optical location survived the liquidation and moved a short distance to the south on Hamilton Boulevard. 

3. Big Ox controversy

The Big Ox Energy biofuels plant in South Sioux City, faced with a mountain of fines, lawsuits and environmental citations, shut down in April. 

Doubts about the viability of the plant came to the fore at the beginning of the year. Facing more than a dozen lawsuits linked to the plant's odors, the Wisconsin-based Big Ox was continuing to rack up fines by the beginning of the year for exceeding limits of wastewater it was discharging to Sioux City's wastewater treatment plant. 

Rumors of financial difficulties surfaced in March, when Sioux City revealed that it was owed more than $3 million in treatment fees, late charges and fines, a total the company disputes.

After repeated citations for venting of hydrogen sulfide gas and solid waste spills, the NDEE called on Big Ox to show why its permits should not be revoked.

Big Ox, which accepted organic waste from local food and beverage manufacturers and converted it to methane for sale and also received wastewater from other South Sioux City industries, pretreated it and discharged it to Sioux City's regional wastewater treatment plant, unexpectedly announced on April 19 that it was suspending its biogas production operations to repair digesters that had leaked solid waste. On April 30, the plant's wastewater treatment operations were shut down after Sioux City did not renew its wastewater discharge permit.

The plant, which began operations in September, 2016, has yet to resume operations while awaiting an NDEE decision on whether to revoke its air and wastewater permits.

4. BPI name change, new management

After years of fighting in court to clear its name, Dakota Dunes-based Beef Products Inc. announced in March that it would change its corporate name. 

The lean beef maker is now called "empirical." 

As part of the transition, BPI founders Eldon and Regina Roth stepped away from day-to-day management of the companies. Their son, Nick, took over as president of empirical innovations, inc. and empirical technology, inc., and their son-in-law, Craig Letch, was named president of empirical foods, inc. Jennifer Letch, wife of Craig and daughter of Eldon and Regina Roth, was named an executive officer in each company.

The former BPI settled a landmark $1.9 billion defamation suit against ABC News in June 2017 for an undisclosed amount. The company had struggled in the aftermath of a series of network reports that described their product, lean finely textured beef, with the unappealing epithet of "pink slime." Demand for the product cratered in the weeks and months after the reports aired. 

5. Hard Rock new ownership

Peninsula Pacific Entertainment, a company controlled by a longtime Iowa gaming executive, will become the sole owner of the Hard Rock Hotel & Casino in Sioux City. 

Peninsula Pacific, which previously owned 50 percent of the entertainment and gaming venue, announced a deal in mid-December with Las Vegas-based Warner Gaming to buy Warner's 50 percent stake in the property. 

The deal is expected to be finalized in the second quarter of 2020, subject to regulatory approval. No changes are expected in the day-to-day operations of the hotel and casino, and all Hard Rock employees will continue in their jobs. 

6. Iowa sports betting

Iowa Gov. Kim Reynolds signed legislation in May legalizing sports betting in the state. The 19 casinos licensed by the Iowa Racing and Gaming Commission were permitted to open sports books and bets online on nearly all college and major pro sports. 

The U.S. Supreme Court opened the door to nationwide sports betting in a May 2018 ruling. 

In the months that followed, casinos throughout the state raced to launch their own sports books. Legal sports betting began in mid-August, and a total of $47.1 million was wagered on sports bets in the six weeks that followed. 

Grand Falls Casino & Golf Resort was the first casino in Northwest Iowa to take sports bets at its newly opened Elite Sportsbook at the end of August. 

Sioux City's Hard Rock Hotel & Casino took its first sports bets Sept. 20, and added online betting in December.

7. Seaboard Triumph Foods Micronesian workers incident

The government of the Federated States of Micronesia (FSM) lodged a formal request in late September for the U.S. government to investigated Seaboard Triumph Foods after dozens of the sovereign island nation's citizens claimed that they had been "harassed" physically and emotionally and had suffered verbal abuse. 

The workers, who had been recruited by the Sioux City pork plant, alleged that after arriving in the U.S., they had to do work inconsistent with what recruiters had told them and the contracts they had signed. They also reported that STF had issued them fake Social Security numbers, seized their passports and refused to provide them copies of their employment contracts. 

STF subsequently said it had provided the Micronesians with a temporary Tax Identification Number (TIN) until they received their permanent Social Security Cards, and it denied holding any employees' passports and said harassment in the workplace is "absolutely prohibited." The plant launched its own investigation of the matter in early October. 

The state subsequently put the pork plant's financial incentives on hold amid the uncertainty surrounding the allegations. 

8. St. Luke’s-Sanford merger 

In June, UnityPoint Health, the operator of Sioux Ctiy's UnityPoint Health-St. Luke's hospital, announced a letter of intent to merge brands with Sioux Falls-based Sanford Health. 

The combination would have created a joint healthcare provider across a large slice of the Midwest and Great Plains. 

Months of silence followed that announcement. In November, UnityPoint and Sanford announced the merger was called off. Little reason was ever provided for the cancellation of the merger -- though in a statement, Sanford Health President and CEO Kelby Krabbenhoft said that Sanford was "disappointed that the UnityPoint Health board failed to embrace the vision." 

9. Cloverleaf sale

Longtime Sioux City cold storage firm Cloverleaf Cold Storage was acquired by Atlanta-based Americold Realty Trust in 2019 for $1.24 billion. 

Cloverleaf was founded in 1952 in Sioux City by members of the Feiges and Kaplan families. A majority interest in the business was sold in 2018 to Blackstone, a New York-based global investment firm. 

In January, Cloverleaf struck a deal with Fort Smith, Arkansas-based Zero Mountain Inc., a cold storage warehousing and transportation company that serves customers across Arkansas. After that deal closed on March 1, the Zero Mountain operations became part of Cloverleaf. 

10. Cherokee meat plant revived again

Lopez Foods acquired the 54-year-old plant in the summer, and by year's end was moving forward with plans to create nearly 400 jobs as part of a $87.6 million project.

Following a series of renovations and the purchase of new equipment, the Oklahoma City-based company expects to start production by June. Lopez says it will make Canadian-style bacon logs, fresh and frozen patties and other new product lines for an undisclosed international restaurant chain.

Lopez Foods purchased the roughly 285,000-square-foot plant from the Iowa Food group for $9.3 million -- $5.8 million for the property and $3.5 million for equipment on site. Previously operated by Wilson Foods, and later IBP inc. and Tyson Foods, the plant has long been a major employer in the Cherokee County seat of about 5,000.

Tyson closed the plant, which had at the time processed deli meats, in 2014. Roughly 450 lost their jobs. 

Iowa Food Group, had grand plans to hire as many as 100 people at the roughly 255,000-square-foot complex but in April of this year, shortly after opening, the company suspended operations and eventually was forced to close.

Lopez traces its history back to Wilson Foods, the firm that originally built the Cherokee plant in 1965. It "originated as a spinoff of Wilson Foods," according to Lopez' website. 

Other significant Siouxland business developments of 2019: 

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A Nebraska landfill had sued in November over several unpaid invoices sent to Big Ox for several loads of sludge the biofuels producer had sent there. It is at least the third judgment entered against the now-closed plant for nonpayment of claims.

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