American Family drops plans for downtown Milwaukee office with 400 workers
American Family Insurance Co. has dropped plans to develop a new downtown Milwaukee office that was to house up to 400 workers.
The company announced Wednesday it was changing its plans after evaluating its real estate portfolio in the wake of the COVID-19 pandemic and the rise of remote work.
“When the pandemic opened up options for how and where employees work, it meant American Family, like so many other companies, had to evaluate our real estate footprint and the space we need for the future,” said Kari Grasee, American Family vice president of business and workplace services.
“We’ve since developed a plan for our real estate portfolio, based on careful consideration of many factors such as business and space needs, lease terms and current building use," Grasee said, in a statement.
That's leading the company to list for sale the vacant building, 1311-1325 N. King Drive.
American Family said it will continue to assess its space needs for Milwaukee, including the possibility of leasing office space.
The Madison-based company said it remains committed to Milwaukee, citing such things as spending more than $10 million in the city on educational programs, small business support and healthy youth development.
The company also has such naming rights sponsorships as American Family Field and the American Family Insurance Amphitheater at Maier Festival Park.
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The decision to drop the downtown office development, which would have renovated a historic building, comes 15 months after American Family sold its former Pewaukee office building.
That 75,000-square-foot office building at W236 N1402 Busse Road, just north of I-94 and east of Highway J/Pewaukee Road, was sold to Generac Power Systems in August 2021 for its expanding business. American Family sold the building after employees started working remotely during the pandemic.
American Family is among a series of businesses that have been rethinking their office space needs with more employees working at home.
Those include Harley-Davidson Inc., where Chief Executive Officer Jochen Zeitz said in October that the company was fully embracing remove work − with plans to find other uses for its 500,000-square-foot headquarters on Milwaukee's near west side.
Other companies are adopting a hybrid model, with employees splitting time between the office and remote locations.
Those include Fiserv Inc., which in October announced plans to move its headquarters to HUB640, in downtown Milwaukee.
A plan to spend $7 million to help finance that $37 million development is to be reviewed by the Common Council's Zoning, Neighborhoods and Development Committee at its Tuesday meeting.
The company expects to have 580 employees in its first year at the new headquarters, with that number rising to 780 by its fourth year. That includes 250 jobs that will be new to the Milwaukee area.
Fiserv must keep its headquarters at HUB640 for at least 16 years. In a nod to the hybrid work model, the contract also says full-time workers must be at the headquarters an average of at least 60% of their time.
Tom Daykin can be emailed at tdaykin@jrn.com and followed on Instagram, Twitter and Facebook.
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This article originally appeared on Milwaukee Journal Sentinel: American Family Insurance drops plans for downtown Milwaukee office
