Allied furiously remodeling,leasing to fuel expansion plan
When Allied Insurance moved to its new headquarters building at 1100 Locust St. two years ago, the company planned to leave its longtime home at 701 Fifth Ave. sitting empty. Instead the property and casualty insurer is renovating that 211,000-square-foot building to house Allied employees, and that’s only one sign of its explosive growth.
Allied is also:
•Leasing 20,000 square feet in the Hub Tower, which will house members of its information technology department by the end of the year.
•Constructing a 70,000-square-foot building in Sacramento, Calif., of which Allied will occupy 40,000 square feet.
•Leasing an additional 25,000 square feet for its operations in Battle Creek, Mich.
Altogether, that’s 6.8 acres of space that the company didn’t have or didn’t plan to use at the end of 2002.
“When we decided to build [at 1100 Locust], the plan was to move completely,” said Roy Kunkle of the company’s corporate real estate office. “We were going to mothball this building,” he said during a tour of the Fifth Avenue location.
“At one point, we were down to about 10 percent of the employees we had here before, maybe 150 people,” Kunkle said. “There are 577 here now, and when the work is done, we’ll have space for 1,100.”
Kunkle said the company anticipates hiring 500 new employees each year for the next several years.
The original two-story building was built as the home of Allied Mutual Casualty Co. in 1949. It has been transformed over the years into a much larger four-story building.
It now houses several call-center operations and is staffed 24 hours a day. The cafeteria serves breakfast, lunch and take-out meals. Phase one of the remodeling involved work on the mechanical systems and was completed in the second quarter of this year. Phase two began in midsummer and involves new carpet, windows, furniture and workstations. Most of the work is expected to be completed by the end of the year.
Total cost of the project is pegged at $6 million. “Compared with the cost of new construction, it was an easy decision,” Kunkle said.
The 532,000-square-foot Locust Street building, shared by Allied and sister company Nationwide Agribusiness, had a price tag of $140 million.
In Battle Creek, where Allied has 86 employees, the company will now occupy the entire fourth floor of the Battle Creek Tower. A release from Allied said the company worked with Battle Creek Unlimited, a community development organization, to remain in that city’s downtown district. Jim Hettinger, president and CEO of Battle Creek Unlimited, was quoted as saying, “We are deeply pleased that we were able to retain this valuable contributor to downtown development. We have an excellent pool of labor in the area to support their growth.”
Allied, which also has office space in Urbandale and West Des Moines, plans to lease the Hub Tower space for a limited time to complete a specific project.
The company owns an undeveloped parcel west of its Locust Street building, and Allied officials have acknowledged that future construction there is likely. “We’re studying future options in Des Moines,” Kunkle said.