Last updated on February 7th, 2023 at 05:30 pm
Northwestern Mutual plans to spend more than $500 million on extensive interior and exterior renovations to the 19-story North Office Building at its downtown Milwaukee headquarters campus and will move nearly 2,000 employees there from its Franklin campus over the next three to five years, the company announced today.
“We are doubling down on our Milwaukee campus by investing in the future of the workplace for Northwestern Mutual and a thriving downtown community,” said Northwestern Mutual chief executive officer John Schlifske.
The 540,000-square-foot North Office Building is located at 818 E. Mason St. and was built in 1990. It is one of four office buildings on the company’s headquarters campus downtown. Exterior renovations planned for the building will mirror the 32-story, 1.1 million-square-foot Northwestern Mutual Tower and Commons building that opened at its downtown campus in 2017, just south of the North Office Building. New Haven, Connecticut-based Pickard Chilton and Houston-based Kendall/Heaton Associates, the same architectural firms that designed Northwestern Mutual Tower and Commons, are also the design firms for the planned transformation of the North Office Building.
The renovations to the North Office Building will create a space “that mirrors the quality and the experience of the Towers and Commons,” said Rebecca Villegas, Northwestern Mutual vice president of enterprise compliance. Project renderings show that the North Office Building will look like a smaller version of Northwestern Mutual Tower and Commons. Villegas said the renovated building will “match the look and feel” of the taller building.
Other improvements planned for the North Office Building will include enhanced employee amenities, an events space and public engagement. The project will create more efficient use of the space, resulting in additional usable square footage and larger overall capacity for the downtown campus, the company said.
Project details are still being finalized, Villegas said. Renderings suggest the North Office Building will remain roughly the same size. But the redesigned building will have more efficient space that will have a higher workstation capacity, she said. Workstations will vary from collaborative-oriented spaces to stations for people to work alone.
In addition to the building renovations, the company’s plans include new connecting structures and a pedestrian plaza on North Cass Street, at the intersection with East Mason Street. The plans call for the elimination of vehicular traffic on a portion of Cass Street between Mason and East Wells streets. The company is still examining if it needs to add any additional parking spaces to the downtown campus, Villegas said.
Project construction could begin in the fall of this year and be complete in 2027.
“We are expanding our world-class campus so that our teams can best serve our clients and policyowners in helping them achieve financial security by protecting what they’ve already built and creating future prosperity,” Schlifske said.
Like many post-pandemic workplaces, Northwestern Mutual has a hybrid office model for its employees. But most of the company’s employees are on campus most of the time, both at the downtown headquarters and in Franklin, Villegas said, and the company wants to bring all of its employees together into the headquarters campus to foster collaboration.
“We always will be a relationship-based culture,” Villegas said. “We want to bring everybody downtown so we can build relationships and build connections. We really see the benefits of having everybody together in the same space.”
The upgrades to the North Office Building would increase the capacity for Northwestern Mutual’s downtown campus to 9,000, the company says, making a significant impact on the downtown area. The company says it is the largest property taxpayer in the city.
“Northwestern Mutual is an incredible community partner and their investment in Milwaukee will signal to the state, region and nation that Milwaukee is the place to do business,” said Milwaukee Mayor Cavalier Johnson.
Northwestern Mutual is seeking $30 million in tax incremental financing from the city for the $500 million project. The company received $54 million in TIF from the city for the $450 million Northwestern Mutual Towers and Commons project. As was done with that project, the TIF for the North Office Building project would be financed up front by the company and recouped from the property taxes it owes the city over time.
As part of the proposed TIF deal the company says it will commit to having no less than 5,375 employees assigned to its downtown campus upon completion of the project and no less than 5,750 employees assigned to its downtown campus by Jan. 1, 2030 and the duration of the tax incremental district.
The company also said it will use SBE (small business enterprise-certified firms) for 25% of the construction and supply costs and at least 18% of the professional services cost on the construction project. At least 40% of the workers on the project will be unemployed or underemployed city residents through the city’s RPP (Residents Preference Program), and certain workers on the project will be paid a $15 minimum wage under the city’s Community-Oriented, Responsible and Equitable (CORE) Development Zone Resolution.
“Projects like these create opportunities for Milwaukee residents,” said Alderman Robert Bauman, who represents the downtown area. “When world-class businesses like Northwestern Mutual choose to invest in Milwaukee, they create jobs and density, resulting in more people experiencing our great city and all it has to offer.”
The company’s announcement for the North Office Building project comes almost 10 years since it unveiled plans for Northwestern Mutual Tower and Commons. Combined, the two project are a nearly $1 billion investment in the company’s downtown Milwaukee headquarters campus.
That’s a major shift from 20 years ago when the company was instead expanding in suburban Franklin, developing a campus northwest of South 27th Street and Drexel Avenue. It opened a five-story office building there in 2004 and a six-story office building there in 2008. The two buildings have a total of 880,000 square feet of office space and more than 2,500 structured parking spaces. The campus still has 16 acres of land available for future development.
While it eventually plans to vacate its Franklin campus, Northwestern Mutual says it has no immediate plans to sell or lease the buildings there because it will have employees operating there for the next three to five years. But the company also says it anticipates the buildings to be “highly desirable to a future company seeking class A office space.”
“The city of Franklin has been a valued partner for more than 20 years,” Schlifske said. “We have invested in the community and transformed 80 acres of land, with 16 acres remaining for future development. It is our hope that our investment will attract another great out-of-state company to call Wisconsin home.”
In addition to its 80-acre campus in Franklin, Northwestern Mutual also owns a significant amount of real estate on the east side of South 27th Street in Oak Creek, across the street from its Franklin campus, and has been working for years to develop it. The company owns about 116 acres of vacant land northeast of the intersection of 27th Street and Drexel Avenue. It also sold the 29-acre site along the west side of I-94, north of Drexel Avenue, to Ikea for its Oak Creek store, which opened in 2018. Northwestern Mutual also sold the land south of the Ikea store for development of a Homewood Suites by Hilton hotel, which opened last year. Northwestern Mutual is also building an apartment development along Drexel Avenue in Oak Creek.
Northwestern Mutual is the largest privately-owned company in Wisconsin, ranking on top of Deloitte’s Wisconsin 75 list and ranking 97th on the 2022 Fortune 500 list. The company has annual revenues of $36.75 billion, a market value of $977 million and 7,585 employees, according to Fortune magazine.
Northwestern Mutual says it has more than $561 billion in combined company and client assets, $34 billion in revenues, and $2.1 trillion worth of life insurance protection in force. The company says it provides nearly 5 million people with life, disability income and long-term care insurance, annuities, and brokerage and advisory services.
In October, Northwestern Mutual said it would pay $6.8 billion in dividends to policyholders in 2023, the highest in the 166-year history of the company in whole life insurance, term insurance, disability income insurance and annuities.