A major corporate employer wants to stay and invest millions into downtown Des Moines. Principal Financial Group hopes to pump $238 million into its offices at 600 7th Street, 711 High Street and 802 Grand. Those plans could depend on whether the city signs off on tax incentives for the project.
“This is a very important project to our company and to our workforce here in Des Moines,” says Ralph Eucher, Principal Senior Vice President, Human Resources and Corporate Services
The workforce 6,000 strong in Des Moines is changing. What started as a “transaction based” company of processing and paying claims is now more “knowledge based", meaning IT and Investment Management driven. Part of the renovation includes transforming the office space to a more collaborative work environment.
“We`ve looked through the project and really believe it would position us very well to attract and retain the kinds of knowledge workers that you`ve heard described well into the future,” says Eucher.
“I think this is the right decision for the city,” says City Manager Rick Clark.
Under a 15-year economic development grant, Principal would receive a tax increment for investing in Des Moines’ downtown. That includes a 50% rebate on the taxes generated by the assessed improvements. Clark says the company isn't getting a tax break and taxpayers aren't funding the project.
“The return for the taxpayer is very good. We're getting new taxes out of this that we would not otherwise get as well as keeping a major employer here and we're building tax base all at the same time,” says Clark.
***UPDATE*** The city council unanimously approved the tax incentives at their Monday meeting.
The proposal still has to go before Principal's board. If approved, a contract would be presented to the city council for another vote. Renovations could begin this summer.