The Iowa Insurance Division will take another 30,000 square feet of office space off the downtown market this spring when it moves into the Ruan II building at 601 Locust St.
Ben Brackett, administrator of the state’s leasing program in the Department of Administrative Services, said a few details remain to be worked out. However, the division is eying the space for about 100 workers.
The move is being precipitated by Principal Financial Group Inc.’s plans to redevelop its properties in River Hills, Brackett said.
Scott Cahill, assistant vice president for corporate real estate at Principal, said the seven Principal-owned buildings in River Hills are at the end of their useful life.
“We could make upgrades, but that doesn’t make economic sense and it doesn’t fit with the master plan for that whole area,” Cahill said.
Principal is not renewing leases as they come due. Instead, it will raze buildings as they become vacant.
For the moment, there are no other plans for the properties. “That’s as far as our plan goes,” Cahill said. “If other developers have concepts … we’d love to have conversations.”
So far, Principal has torn down one building in River Hills. The area is located between East Second and East Fourth streets, Des Moines Street on the south and Interstate 235 to the north.
So far as the Division of Insurance move is concerned, “We’re happy to have some guys from the state in our neighborhood,” said Glenn Lyons, president and CEO of the Downtown Community Alliance.
He said a report that a report to be released later today by CBRE/Hubbell Commercial is expected to show a decline in vacant downtown office space, due in large part to repurposing older office buildings such as the Des Moines and Fleming buildings and the upcoming move by The Des Moines Register to Capital Square.