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The year in review


Call it the year of guns and butter. And what a different year it was from 2002.

On January 1 of last year, the Dow Jones industrial average hovered near 8,500, having capped its third-straight year of decline. Unemployment stood at 6 percent, the highest rate in eight years. The University of Michigan’s consumer sentiment index was at 86.7, reflecting the pessimism Americans were feeling. Saddam Hussein was in still in power and the United States faced an uncertain future in the Middle East.

Today, the Dow Jones has crested 10,000. The U.S. unemployment dipped to 5.9 percent in November and is continuing to slide. The University of Michigan’s consumer sentiment index came in at 92.6 this month. In the third quarter, the U.S. economy roared ahead at an 8.2 percent annual clip, powered by low interest rates and tax cuts. Hussein, his government toppled in April, emerged from hiding two weeks ago without a fight.

If 2001 was the year when everything changed, 2003 will likely be remembered as the year we began patching up what was broken.

Closer to home in Central Iowa, the message was similar. Merger and acquisition activity picked up considerably, reflecting growing confidence among business leaders and the rising stock market. Job cuts still made headlines, but they were far fewer in number.

One of the year’s dominant themes was construction, both downtown and in the suburbs. Projects totaling $1.27 billion were either under development or considered during the year, according to figures from the Greater Des Moines Partnership and the Downtown Community Alliance.

Work progressed on the $217 million Iowa Events Center and construction began on the new Des Moines Public Library and the John and Mary Pappajohn Center for Higher Education. By year’s end, the future IMAX theater of the new Science Center of Iowa building was taking visible shape and the Des Moines Arts Center had opened a satellite branch in Wells Fargo’s downtown building.

Local developers Harry Bookey and Jim Hubbell III announced ambitious plans to revitalize the Court Avenue Historic District. Their proposal calls for a mix of nine commercial and residential projects located on both sides of Court Avenue between Second and Fifth avenues.

East Village LLC and Knapp Properties/Neighborhood Investment Corp./Hatch Development Group, found themselves competing for the chance to build more housing and space for stores in downtown Des Moines’ East Village.

Not all of the news downtown was good, however. In December, the Polk County Board of Supervisors said the Polk County Convention Center was too expensive and needed to be shuttered until it could be sold. Des Moines’ Coppola family, which controls Randolph Investment Corp., closed the Kirkwood Civic Center Hotel, citing “the changing complexion of the downtown area, particularly the Court Avenue district.”

In the western suburbs, work on Jordan Creek Town Center, the most expensive project currently under development in the state, continued and is expected to be complete by August.

Aside from Jordan Creek, the most talked plans were from Wells Fargo Home Mortgage, which after a flurry of negotiations with several Des Moines suburbs and cities in other states, reached an agreement with West Des Moines to locate a $118 million facility near 74th Street and E.P. True Parkway.

The company was active downtown, as well, purchasing a small building on northwest corner of Eighth and Walnut streets in September and later announcing plans to build a multi-story tower on the space to make room for its quickly growing Wells Fargo Financial subsidiary.

The financial services giant wasn’t the only company generating development-related headlines, however. Tim Urban began construction of West Glen, a $100 million combination of homes, shops and office space that promises to create West Des Moines’ densest complex and help cement George M. Mills Civic Parkway as West Des Moines’ Main Street.

Hoteliers were honing in on the growth, too. At least three new hotels are under development in Des Moines’ suburbs, promising to add 445 new rooms to the metro area. That’s in addition to approximately 1,600 new rooms that have been built over the past six years, representing a 36 percent increase in rooms.


While the stock market and corporate bankruptcies wiped out nest eggs for many of Iowa’s retires in 2002, the news in 2003 was about upscale retirement communities being built in Des Moines’ western suburbs. Some units at Clive’s Deerfield Retirement Community, for example, cost upward of $200,000 and more than two-thirds of them have been reserved, though the development won’t open for months.

Other health care issues included rising higher costs and the debate over whether more hospitals should be added in West Des Moines.

In May, the U.S. Department of Justice rejected a request from Iowa Health-Des Moines and Mercy Medical Center to jointly build a hospital in West Des Moines. Iowa Health-Des Moines said a month later that Regency Homes founder Michael R. Myers and his family had pledged $15 million to help pay for the facility.   Iowa Health has said the 83-bed Michael R. Myers Hospital, as it would be known, would cost about $83 million. Mercy said it would build a hospital across the street from Iowa Health’s if the health care provider wins approval from state regulators.  Wellmark Blue Cross and Blue Shield of Iowa, acting on behalf of its large corporate clients, led the fight against any hospital development in the western suburbs.

The intensity of the debate grew in December, when Iowa Health and Wellmark began a public campaign to shore up support for their sides in the issue. The effort, which included tens of thousands of letters to consumers in Central Iowa and full-page newspaper advertisements, resulted in a flood of letters – both in favor and against any new hospitals -from concerned consumers to state regulators, who will decide on the issue in February.


The improving economy was reflected in the number of acquisitions that took place in 2003, accelerating as the year wore on. They include, but aren’t limited to, the following transactions:  Tom Goldman’s IPM Group Inc., the paint manufacturer whose products have coated everything from Titan rockets to billboards in New York City’s Times Square and rooms in Terrace Hill, bought Sterling Paint Inc. of Little Rock, Ark.

Liberty Bank FSB agreed to buy StateFed Financial Corp. for about $17.6 million in cash, ending several years of on-again and off-again attempts by Liberty and other financial institutions to purchase the bank.   Iowa Telecom purchased Lighthouse Communications’ residential Internet service provider business.

Milwaukee-based M&I Bank FSB agreed to buy AmerUs Home Lending of Urbandale, a division of Des Moines-based AmerUs Group Co. Des Moines-based insecticide maker Chem-Tech Ltd. Purchased Loveland Industries’ Prozap line of insecticides for use on animals.

A.J. Allen Mechanical Contractors Inc., which is based in Des Moines, snapped up American Air Technologies. Siegwerk Group, a German printing-ink maker, bought Color Converting LLC of Des Moines, the second-largest U.S. producer of inks for consumer product packaging.  Davenport-based Per Mar Security Services said it purchased Feel Safe Security Systems Inc. of West Des Moines and St. Louis-based Medicine Shoppe International Inc. agreed to buy Medicap Pharmacies Inc. Ruan announced plans at the end of December to sell its leasing business, which accounts for about 25 percent of its revenues to Ryder System Inc.


The Grow Iowa Values Fund sprang into life at the beginning of the year, smaller than had been hoped for but in existence nonetheless. No sooner had it completed several rounds of financing for such companies as Wells Fargo & Co. and Trans Ova Genetics Inc., that Chairman Holmes Foster said the fund may fall far short of hitting its projected $500 million mark.

The fund’s financing structure is based on the growth of sales and use taxes, and neither is expected to grow fast enough to contribute to the fund. Whether legislators take up the funding issue in 2004 remains to be seen. Foster resigned over concerns that he didn’t have enough time to dedicate to the fund’s management. Iowa Farm Bureau Federation President Craig Lang succeeded him.


*The Principal Riverwalk project moved closer toward construction in 2003. The design was delivered in February to the Des Moines City Council by the Riverwalks 15-member executive committee, which had received more than 3,000 e-mailed comments and suggestions from residents. More recently, Vision Iowa board approved a $4 million grant for the project.

*Teresa Wahlert announced her resignation as president of the Greater Des Moines Partnership, surprising many. She will leave at the end of January to become president and chief operating officer at MidAmerica Group Inc.

*The Firestone Agricultural Tire Division said in January it will proceed with plans for a $24 million, 850,000-square-foot warehouse near Ankeny that will serve as a global distribution center for the manufacturer, which distributes its products in 70 countries worldwide. The factory employs about 1,250 laborers and 250 salaried workers.

*Newton made moves toward a $30 million motorsports complex in Iowa.

*Unable to attract enough passengers, Continental Airlines said it would discontinue its unprofitable Des Moines to Newark, N.J., route, effective Nov. 1. It was the only non-stop service between Central Iowa and the New York metropolitan area.

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