New Ulm

Progress Intersects With Growth

Building Futures Through Community and Commerce

In New Ulm, progress is happening on every corner. Over the past year, more than a dozen new businesses have opened, community events are transforming downtown streets into gathering places, and ambitious housing and infrastructure projects are setting the stage for decades of growth. 

A downtown designed for connection

“We have several programs and events for the downtown,” says Sarah Warmka, President and CEO of the New Ulm Area Chamber of Commerce. “We have the downtown flower beautification efforts, the banners that are on the signs downtown, and events where we have a mobile turf that fills an entire block to create a temporary green space. We also bring in 1,600 tons of sand for our ‘Spiking in the Street’ event, converting two downtown blocks into sand volleyball space. It’s about making downtown a place where the community can come in, feel connected, and visit with their neighbors.”

Warmka explains that beautification and culture go hand in hand. “Last year, we did a community collage where people could get their pictures taken, and now it’s compiled on the side of a building downtown. A few years ago, we added a mural. It’s all about celebrating community identity.”

That identity has been good for business. “People see the downtown as a place they want to be,” Warmka adds. “It’s vibrant and happening.”

A surge of small Businesses

“Looking at the businesses that opened last year, we had an accounting office, a coffee shop, a Mexican restaurant, a small event center, a youth sports training center, a chiropractor, a smoke shop, a bookstore with coffee shop and event space, a barbershop, a skincare salon, a mental health/substance abuse facility and a massage & holistic health center. We are very fortunate to have so many diverse businesses opening in our community,” says Heather Bregel, Economic Development Director. “To date in 2025, we’ve already had eight new businesses open.”

Bregel emphasizes that incentives play a key role in helping entrepreneurs succeed. “We have a small business incentive grant program that’s been very popular. In 2025, we funded five new businesses with $10,000 startup grants. We also offer small business loans at a low interest rate and a commercial property rehab loan program for those needing to update their buildings. We want to make it as easy as possible for people to open a business here.”

That support extends beyond funding. “We provide free business consulting,” Bregel explains. “We have a consultant under contract so business owners can meet with her and get support at no cost, whether it’s developing a business plan, preparing a financial pro forma, or improving marketing. Normally, they would have to pay for those services, but here, they’re free.”

Utilities built for the next 50 years

“A lot of our projects are due to aging infrastructure,” says Kris Manderfeld, Utility Director. “We completed condition assessments for wastewater, electric, and water systems. These assessments provide a pathway for the next 5, 10, and 20 years, ensuring continuity when staff retire or new commissioners join, with a strategic plan in place. It also helps us coordinate state or federal funding opportunities.”

Manderfeld notes several projects are already underway. “We’re planning a fourth substation on the northwest side of town to handle industrial growth. We’re beginning engineering on a parallel sanitary sewer force main that carries 99 percent of our wastewater. We completed a new raw water line from our north wellfield, replacing one that was installed in 1969. And we’re upgrading substations from mechanical to digital components, so they integrate with modern SCADA systems.”

Shovel-ready for residential growth

“In some cases, residential development is spurred by the developers themselves,” says Joseph Stadheim, City Engineer. “We do have a handful of apartment projects and a couple of single-family home developments in process right now. Through the comprehensive plan, concepts are already in place for how residential development can look in the future.”

Stadheim stresses the importance of infrastructure readiness. “Our sanitary sewer mains and water mains are sized to handle additional development on the outskirts. Whether it’s residential, multifamily, or industrial expansion, our pre-planning ensures the infrastructure is there.”

He adds that transportation upgrades are equally important. “Highway 14 was expanded to four lanes up to the south end of town in late 2023. We also worked with MnDOT on a roundabout at Highway 14 and North Highland Avenue, a troubled intersection with safety concerns. These partnerships help us improve the roadway network for residents and travelers.”

Housing for every generation

“We have a lot of housing projects in the pipeline right now,” says Bregel. “The former George’s Ballroom site downtown will become 80-100 rental units. Another project at the former mall site could range from 30 to 90 units, depending on whether a boutique hotel partner joins the project. We have the River Haven development, located near the municipal airport, featuring two multifamily towers, town homes, twin homes and single family homes. There’s also a “barndominium” or “shouse” project moving forward.” 

The momentum continues. “There’s a 144-unit project near the high school, with four buildings of 36 units each,” Bregel notes. “That’s likely the first one to break ground. We also have a senior housing project, 30 to 40 units, in partnership with the local nursing home. And a local nonprofit has acquired land to build a 15-unit tiny home village.” Bregel says the impact is already visible. “Our median age is trending down. Young families are drawn to this area, attracted by its excellent schools, family friendly amenities, and strong sense of community. It’s great for our schools, too, because enrollment numbers are going up.”

Schools, parks, and family appeal

New Ulm’s draw goes well beyond the availability of new housing. “Families can choose between public, Catholic, or Lutheran school systems, all K-12,” Bregel explains. “We also have a Lutheran college in town. And we’re unusual in having a state park within city limits, complete with a sand-bottom beach swimming area. Those are assets that make New Ulm very attractive.”

For families considering a move, the variety of school options is a powerful incentive. Parents can align their education with their values and goals, knowing that their children will have access to high-quality academics and a range of extracurricular programs. Coupled with a state park right in the heart of the community, a rare amenity for a city of New Ulm’s size, residents enjoy a blend of urban convenience and outdoor recreation.

Tourism with a creative edge

“Our lodging tax is strong, and we recently completed a hotel feasibility study,” says Warmka. “New Ulm attracts all kinds, seniors who love the history and German culture, and younger people drawn to music festivals, breweries, distilleries, and lounges. We like to try out-of-the-box ideas, like our 40-foot upside-down Christmas tree – another way to stand apart and get noticed.”

Tourism in New Ulm reflects the city’s unique blend of tradition and innovation. Visitors stroll through historic streets where polka music spills from local restaurants. In contrast, others come specifically for modern attractions such as the craft brewery scene or annual festivals that spotlight music and community spirit. Warmka emphasizes that standing out is part of the strategy. The creative touches—whether it’s large-scale art, quirky holiday traditions, or pop-up downtown events—help New Ulm compete with larger destinations while still leaning into its cultural roots.

She adds that the tourism market is expanding well beyond the city’s borders. “We welcome tourists from around the world. Our biggest area is the Twin Cities metro, but we also see visitors from Rochester and Sioux Falls. It’s about standing out while staying authentic.” With a strong regional draw and increasing recognition in broader markets, New Ulm is positioning itself not only as a charming weekend getaway but also as a vibrant cultural hub that highlights the best of small-town Minnesota.

Open for business, ready to grow

“We just continue to try to fill our empty storefronts,” says Bregel. “We don’t have many left thanks to years of effort. We’re seeing a post-COVID boom where entrepreneurs are taking chances and opening small businesses. Our job is to support them as much as possible.”

That vision highlights New Ulm’s broader development philosophy. Rather than pursuing large-scale projects alone, the city is focused on creating an environment where small businesses thrive, infrastructure is in place, and residents feel supported. The combination of grant programs, low-interest loans, consulting services, and proactive planning demonstrates a city working diligently to strike a balance between growth and sustainability.

For Bregel and her colleagues, the next 18 to 24 months will be about building on the momentum already in motion—ensuring new storefronts are filled, housing projects break ground, and infrastructure projects move from planning to reality. The message to entrepreneurs and families alike is clear: New Ulm is open for business and ready to grow.

Tradition and progress together

As the city continues to evolve, leaders are clear that growth will not come at the expense of identity. New Ulm’s heritage—its German culture, murals, and community traditions—remains central even as new infrastructure, businesses, and housing transform its future.

“People see the downtown as a place they want to be,” Warmka says. “It’s vibrant and happening.”

That vibrancy is both a reflection of the past and a promise for the future. By embracing its roots while welcoming new ideas, New Ulm demonstrates that small cities can thrive when tradition and progress work in harmony. 

At A Glance

Who: New Ulm, Minnesota

What: A small city on the Minnesota River, known for its strong German heritage, historic architecture, and vibrant cultural traditions.

Where: In southern Minnesota, nestled along the Minnesota River, about 90 miles southwest of Minneapolis.

Website: www.newulmbusiness.com