Tyson Foods will move about 500 corporate employees in Chicago and suburbs to Arkansas headquarters
Meat processor Tyson Foods will move about 500 corporate employees based in its Chicago office and Downers Grove, Illinois, innovation center to its Springdale, Arkansas, world headquarters, the company said in a news release Wednesday.
Tyson is also moving employees to Arkansas from Dakota Dunes, South Dakota. A “phased relocation” of employees from those three locations will begin early next year, the company said.
About 1,000 employees in total will be affected by the consolidation, Tyson spokesperson Derek Burleson said in an email.
The company’s Chicago offices are located at 400 S. Jefferson Street. Tyson acquired that office and the Downers Grove innovation center when it bought Hillshire Brands for nearly $8 billion in 2014. The 247,000 square-foot building is now owned by Newton, Massachusetts-based Office Properties Income Trust, which last year bought Google’s Fulton Market headquarters for $357 million.
Tyson’s Dakota Dunes location is the corporate office for its beef and pork business, Burleson said.
In 2020, the company cut about 500 jobs in Chicago and Arkansas as part of a restructuring program.
Burleson said the company is not planning layoffs in association with the consolidation. Severance will be determined “on an individual basis” for those who choose not to relocate to Arkansas, he said. The company is also planning an expansion and remodel of its Arkansas facilities.
“Bringing our talented corporate team members and businesses together under one roof unlocks greater opportunities to share perspectives and ideas, while also enabling us to act quickly to solve problems and provide the innovative products solutions that our customers deserve and value,” CEO Donnie King said in a statement.
In August, Tyson reported third-quarter revenue of nearly $13.5 billion, up about 8% from the same period the year before. The company’s net income, however, remained flat year-over-year. In an earnings call, King told investors the sales gains were largely caused by inflation in the prices of chicken and prepared foods.
The Tyson consolidation adds to a recent string of corporate departures from Chicago, including the headquarters of Citadel, Boeing and Caterpillar this year.
Last month, McDonald’s CEO Chris Kempczinski rang alarm bells about the effects of crime on business in Chicago and called for more collaboration between business leaders and the public sector to address the issue. Mayor Lori Lightfoot fired back, saying more than a hundred companies had moved to or opened in Chicago over the last year-and-a-half.
Despite Kempczinski’s comments about the downtown business climate, McDonald’s announced plans the same day to shift 120 jobs from Romeoville, Illinois, to the company’s West Loop headquarters.
It’s unclear what Tyson’s plans are for the office space it is leasing on Jefferson Street, but a complete departure would leave a hole in the downtown real estate market, which has been unsettled by COVID-19. Many downtown firms have decided to shrink their footprints, while others remain gun shy about signing new leases, and that’s hurting efforts to fill empty space. The downtown vacancy rate hit 20% by mid-year, according to commercial real estate firm Colliers International, a historic high.
David Burden, a principal at Colliers, said filling the Jefferson Street space, a 1940s-era warehouse converted into office space a decade ago by developer Sterling Bay, may not take very long if Tyson exits its lease.
“There is still a lot of demand for West Loop buildings that are retro on the outside but modern on the inside,” he said. “This building needs to be refurbished, but that’s not unusual because it has been ten years.”
