Last updated on May 13th, 2019 at 02:36 pm
Manpower Inc.’s decision to move its corporate headquarters from Glendale to an area just north of downtown Milwaukee promises to be a tremendous catalyst for economic development in surrounding central city neighborhoods and the downtown area. Politicians, business people and everyone else who has a stake in the city’s overall economic vitality should appreciate the benefits of Manpower’s decision to make Milwaukee its home.
More than 900 Manpower employees will move into a 280,000-square-foot office building located on the Milwaukee River east of North King Drive and south of West Cherry Street just south of the Schlitz Park development.
The building’s main entrance will open onto the city’s RiverWalk and will be the first major downtown office building to have its main entrance facing the river.
Manpower’s offices will be the focal point of a $94 million development called RiverBend Place that will become the largest office complex to be constructed in the downtown area in more than 10 years.
The landmark project promises to spur the continuing development of restaurants, shops, housing and offices along North Martin Luther King Drive and the city’s new Bronzeville District along North Avenue.
City development officials, along with business and civic leaders in the North King Drive area, have already hailed the RiverBend development as a major boost to their efforts to drive economic development in the area.
Manpower is an international company with 25,000 employees worldwide. A company spokeswoman said the new global headquarters will regularly host visitors from around the world who will need overnight accommodations as well as places to dine and shop.
If one takes into account Manpower’s 900 local employees and an additional 300 expected to be added over the next five years, that’s 1,200 additional people who will become consumers for businesses in surrounding neighborhoods and the downtown area.
A $10 million renovation project of the North Power House, a former power plant just south of the Manpower headquarters in the RiverBend development, will create another 50,000 square feet of office space for about 200 employees.
To its credit, the City of Milwaukee has committed to borrowing $25.3 million to help finance the Manpower building development. It’s a wise investment and one that takes advantage of an existing tax incremental financing (TIF) district, which calls for the additional taxes generated by the property development to pay off the money it borrows.
No current city taxes will be used for the project, and the city has received a guarantee from the developer that it will not have to subsidize the project in the future. Once the project is paid off, the city and other local taxing districts will receive the full benefit of all the additional taxes that the project will pay.
In effect, the city is investing in its own future by borrowing money and using the additional taxes the project will generate to pay off the cost of the money it borrows. The city is not at risk because the developer is guaranteeing repayment of the bonds.
The money the city borrows includes $20.6 million that will finance a 1,260-stall parking deck that the city will own, a $3 million loan to the developer, RiverBend Place and a $1.7 million grant to the project.
It’s important to understand that the city’s investment in this project will pay for itself in the form of additional property taxes that will be generated by the development. Those focusing on the big picture also understand that the overall economic benefit of bringing additional business and employees downtown will be worth far greater than the initial investment.
It’s not unlike what transpired during the development of Schlitz Park.
During the 1990s, the Schlitz Park Development reclaimed 900,000 square feet of vacant buildings and converted them into a dynamic office park, employing 2,500 people. Also included in the development was an 800-student middle school that became the Milwaukee Youth Arts Center.
A TIF was created to help finance development of Schlitz Park and was paid off ahead of schedule. Meanwhile, the tax increment has continued to grow on the property.
In 2001, the TIF District #41 was formed that includes the land where RiverBend Place will be located. The first development to take place involved the Commerce Street Power Plant, a 150,000-square-foot historic building developed in 2001 that is home to Time Warner Cable. There are 850 employees in the building.
Beyond the Manpower and North Power House development, there is potential to develop an additional 160,000 square feet of office space in the RiverBend development. The arrival of Manpower will likely serve as an attraction for other businesses seeking development in an up-and-coming urban area.
When completed, TIF District # 41 will include 760,000 square feet of office space at a cost of $150 million and will employ 3,600 people. Phase one of the project, which includes the Commerce Street Power Plant, North Power House and the Manpower corporate offices will cost $122 million and house 2,500 employees.
Make no mistake; Manpower’s decision to locate its headquarters in the RiverBend development is an opportunity the city cannot afford to lose.
The company’s decision to locate in Milwaukee and, more importantly, stay in the region, will prove to be huge benefit for local economic development efforts.
This landmark project is what Milwaukee needs in order to stimulate development and to send a signal to the development world that the city is indeed "open for business."