Citigroup Inc.’s announcement that it will add 200 Central Iowa jobs at a new facility in Urbandale was great news not only for the suburb and the area in general, but also for R&R Realty Group. The West Des Moines development company waited several years after acquiring 280 acres of land west of Interstate 35/80, looking for the right moment to launch the development of a business park there.

The planned Citi Cards operation in a 169,000-square-foot building now under construction plus a commitment by Dahl’s Food Marts to build at the southwest corner of the site gets Paragon Office Park off to a fast start.

“The timing is now because we’re seeing more demand out there,” said Mark Rupprecht, president of Realty Marketing Group, an R&R subsidiary. “We look at projects from a demand-driven standpoint, not the cost of money. That’s the philosophy we’ve always had. Five years ago, we thought it was a good location from an office development standpoint, and since then, there’s been a lot of residential growth in that area.”

Fully developing the business park could take 10 years or more, Rupprecht said. When it’s finished, it’s expected to include 2.5 million square feet of office space and 750,000 square feet of retail space. The total cost is projected at $300 million.

Dahl’s bought a building site at the intersection of 128th Street and Meredith Drive. Citigroup signed a 15-year lease on the building being constructed. “A lot of retailers are looking to own, and we’re willing to sell sites,” Rupprecht said. “Office space also can be owned or leased.”

Although it’s too soon to set rental rates, Rupprecht said his company is trying to develop properties that will rent at the high end of the Central Iowa scale.

R&R hopes to have a four-acre lake, a road around it and an extension of 121st Street in place by the spring of 2006. The Citi Cards building is scheduled to be ready for occupancy in January 2006.

Paragon rates as the largest and most comprehensive development project so far for R&R Realty Group, which was founded in 1985 by Rupprecht’s father, Daniel. In the late 1980s, the company built the Three Fountains Office Park at 42nd Street and Westown Parkway in West Des Moines; that was a 75-acre project with no retail component.

In the early 1990s, it started work on Country Club Office Plaza on 74th Street – now Jordan Creek Parkway – in West Des Moines. The original site was about 165 acres and later acquisitions increased R&R’s holdings there to 200 acres.

“You certainly do learn as you go through the process,” Rupprecht said. “Demand (for different features) ebbs and flows, but there’s not a huge change in the basics. Accessibility to transportation and services are always major factors.”

The Paragon parcel was severed from Grimes and annexed by Urbandale in two pieces, one in 1998 and the other in 2002. “Until R&R acquired the land, we did not expect development to extend all the way west to 128th Street,” said Paul Decker, Urbandale’s director of community development. Decker said there have been no discussions of city involvement with infrastructure inside the park. He noted that Urbandale participated in the paving of Meredith Drive along the south edge of the parcel in 2003 and in extending sewer lines to the property.

With a projected workforce of 8,000, the business park is expected to be “a very significant” change for Urbandale, in Decker’s view. “Our projection has been that local jobs would at least equal our labor force in 2020,” he said. “This will take us a big step toward that, perhaps beyond. It will help push us to the point where more people are commuting into Urbandale than are commuting out.”

WAITING FOR PAVING

Two proposed transportation projects stand to benefit R&R Realty Group’s new Paragon Business Park by increasing traffic past the area, but it’s not yet clear when, or if, they’ll be completed.

A proposed interchange at Interstate 35/80 and Meredith Drive is part of the Des Moines Area Metropolitan Planning Organization’s 2030 plan, and the city of Urbandale has said that it will do that project by 2010, along with an interchange at 100th Street. However, MPO Executive Director Tom Kane said meetings and studies continue on the proposal.

Also under consideration is a relocation of Iowa Highway 44 that would place it at the northern edge of the business park. “That is very conceptual,” Kane said. “It has not been officially brought to the MPO.”