SMARTER BUILDINGS ON THE RISE 28 ADDING PRIVACY TO THE OPEN CONCEPT OFFICE 30 NORTHWESTERN MUTUAL TOWER & COMMONS OPENS 32
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BOYS & GIRLS CLUBS OF GREATER MILWAUKEE
WHO’SWATCHING WATCHINGOUR OURKIDS KIDSAFTER AFTERSCHOOL? SCHOOL? WHO’S
The mission of Boys & Girls Clubs of Greater Milwaukee is to inspire and empower all young people, especially those who need us most, to realize their full potential as productive, responsible and caring citizens.
1558 N. 6th Street Milwaukee, WI 53212 (414) 267-8100
boysgirlsclubs.org facebook.com/bgcmilwaukee @bgcmilwaukee
750 $26,808,482 1887
TOTAL EMPLOYEES: ANNUAL REVENUE:
SERVICE AREA Boys & Girls Clubs of Greater Milwaukee has 44 locations in the area with more than 43,000 members and serves more than 5,000 kids every day.
Publication Date: November 13, 2017 A SUPPLEMENT OF
Contributions ..........................................................44% Grants ........................................................................42% United Way ..................................................................5% Investment Distribution .........................................5% Service & Rental Fees ............................................4%
Vincent Lyles President & CEO
Susan Ela Board Chair
Our vision is to build the community’s social and economic fabric by ensuring the academic and career success of every child that walks through our doors. With the help of community partners, volunteers, generous donors and committed staff, Boys & Girls Clubs of Greater Milwaukee provides after-school and summer programming to more than 43,000 children and teens at 44 locations. Within the safety of the Clubs, children and teens receive academic support, free meals, characterbuilding programs and access to role models. Every child deserves a future of unlimited possibilities.
Boys & Girls Clubs of Greater Milwaukee hosts special events throughout the year to engage the public in our mission and raise funds to support our programming. Events include but aren’t limited to our Annual MVP Gala in May, Celebrating G.I.R.L.S in November, YP Prom, and Lumberjack Brunch at Camp Whitcomb/Mason. All events have ticket and sponsorship opportunities, for more information please visit our website.
The Clubs have a role for skilled and committed volunteers. Our needs are ongoing, and we are always looking to expand our volunteer roster. We offer one-time and recurring opportunities with projects ranging from Club beautification to literacy activities with Club youth. If you are interested in volunteering or creating a one-time opportunity for your company, please complete the Volunteer Inquiry Form on our website or contact our Volunteer Coordinator at (414) 267-8111.
Making a financial gift, attending a special event, volunteering and including the Clubs in estate plans are just a few of the ways individuals can help give Club members the resources they need to work toward productive futures. Your investment will create a ripple effect in the community as today’s young people become tomorrow’s leaders.
BOARD OF DIRECTORS
★ DENOTES EXECUTIVE LEADERSHIP
Christopher S. Abele
Jack A. Enea
Jerome M. Janzer
Richard R. Pieper, Sr.
John W. Splude
Barry K. Allen
Jeffrey A. Joerres
James R. Popp
Mary Ellen Stanek
Bevan K. Baker
Edward A. Flynn
Robert B. Pyles
James T. Barry, III
William Fitzhugh Fox ★
David F. Radtke
David A. Baumgarten
Alexander P. Fraser
Sarah Wright Kimball
Kristine A. Rappé
David L. Bechthold ★
Bethany M. Rodenhuis
Thomas H. Bentley, III
Steven L. Laughlin
Gordon J. Weber
William R. Bertha
Charles B. Groeschell
Thomas M. Bolger
Bronson J. Haase
Keith R. Mardak
Richard C. Schlesinger
Maureen A. McGinnity
Allan H. Selig
Daniel F. McKeithan, Jr.
John S. Shiely
William C. Hansen
Robert L. Mikulay ★
Thelma A. Sias
Thomas J. Hauske, Jr.
Brian Morello ★
Gregory Wesley Arthur W. Wigchers James B. Wigdale Madonna Williams Scott Wrobbel ★
Cory L. Nettles
James L. Ziemer
Tina M. Chang
Keith D. Nosbusch
Guy W. Smith
G. Spencer Coggs
Wayne C. Oldenburg
Russell M. Darrow, Jr.
Charles V. James
Guy A. Osborn
Thomas L. Spero
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WEARE. ARE.Each Each day after school, thousands kids find safety WE day after school, thousands ofof kids find safety and inspiration their Boys Girls Club. With academic support, and inspiration atat their Boys && Girls Club. With academic support, arts programming, structured sports leagues, technology labs and arts programming, structured sports leagues, technology labs and free meals, there something for every kid the Club. free meals, there is is something for every kid atat the Club.
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BizTimes Milwaukee (ISSN 1095-936X & USPS # 017813) Volume 23, Number 11, August 21 – September 3, 2017. BizTimes Milwaukee is published bi-weekly, except two consecutive weeks in December (the second and third weeks of December) by BizTimes Media LLC at 126 N. Jefferson St., Suite 403, Milwaukee, WI 53202-6120, USA. Basic annual subscription rate is $42. Single copy price is $3.25. Back issues are $5 each. Periodicals postage paid at Milwaukee, WI and additional mailing offices. POSTMASTER: Send all UAA to CFS. NON-POSTAL AND MILITARY FACILITIES: Send address corrections to BizTimes Milwaukee, 126 N. Jefferson St., Suite 403, Milwaukee, WI 53202-6120. Entire contents copyright 2017 by BizTimes Media LLC. All rights reserved.
4 Leading Edge 4 NOW BY THE NUMBERS 5 ON THE JOB WITH… 6 REV UP 7 IN THE NEIGHBORHOOD 8 BIZ TRAVELER 9 BIZ POLL ON MY NIGHTSTAND 10 GETTING THERE 11 BIZ LUNCH 12 FRESH DIGS
13 News 13 THE INTERVIEW 14 MY TAKE 15 MADE IN MILWAUKEE
16 Real Estate 28 Office Space COVER STORY
46 JOHN HOWMAN 47 CARY SILVERSTEIN 48 TIP SHEET
50 Biz Connections
32 Northwestern Mutual Tower & Commons The Northwestern Mutual Tower & Commons, the tallest building erected in downtown Milwaukee in 44 years, opens its doors Aug. 21. Read about the vision, the designers, the workers and the construction of the project.
50 PAY IT FORWARD 51 PERSONNEL FILE 52 GLANCE AT YESTERYEAR COMMENTARY 53 AROUND TOWN 54 MY BEST ADVICE
C R E AT E D TO B E
W I SCO N S I N ’S BA N K F O R B U S I N E SS™ As a company built for this area, we see things differently. We don’t worry about what other companies are doing in other places, because we know firsthand what our area and businesses need to succeed. This is because we’re a proud local business too. It makes all the difference when a bank understands your community and supports your business goals. That’s why we’re honored to call ourselves Wisconsin’s Bank.
4 1 4 - 2 7 3 - 3 5 0 7 | w w w. t o w n b a n k . u s
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BIZTIMES MEDIA – Like us
Twin Cities-Milwaukee-Chicago rail proposal moving forward By Corrinne Hess, staff writer
A proposed Twin Cities-Milwaukee-Chicago intercity passenger rail service project that would connect Chicago to Minneapolis by way of Milwaukee recently took another step forward. The Minnesota Department of
Transportation released its “purpose and need statement” for the project, marking the beginning of the public involvement and environmental study portion of the proposal to add an Amtrak line across the state of Wisconsin.
BY THE NUMBERS
Fiserv Inc. could get up to
M I L L I O N in tax credits to keep its headquarters and jobs in Wisconsin, under proposed legislation. Another $2.5 million would go toward its construction costs if it builds a new headquarters here.
4 / BizTimes Milwaukee AUGUST 21, 2017
The TCMC corridor already exists. It is a 418-mile rail corridor connecting Minneapolis and St. Paul, Milwaukee and Chicago and providing service to smaller cities, including La Crosse, Tomah, Wisconsin Dells and Portage. It is currently served by Amtrak’s long-distance Empire Builder service, which operates between Chicago and Seattle and Portland, and provides one trip per day in each direction, with several stops in Wisconsin. Amtrak also has operated the Hiawatha service since 1989 and currently serves stations at the Milwaukee Intermodal Station, Mitchell International Airport and Sturtevant in Wisconsin, and Glenview and Chicago in Illinois. In 2016, ridership was 815,196, according to the purpose and need statement. TCMC would add a second, shorter-distance train along the route between Union Depot in St. Paul and Union Station in Chicago, making two stops in Milwaukee – downtown and at the airport. A 2015 feasibility report conducted by the Minnesota and Wisconsin departments of transportation found the corridor could support an additional train, based on expected population increases
and economic growth projected within the corridor. “The second daily train is projected to grow the market and provide greater reliability at conventional speed of 79 miles per hour,” said Dan Krom, director of MnDOT’s Passenger Rail Office, which is leading the planning efforts. Representatives from WisDOT could not immediately be reached for comment. The purpose and need statement did not address funding the project. In 2010, Gov. Scott Walker rejected an $810 million federal grant to the state which would have been used to extend the Hiawatha from Milwaukee to Madison. The 110-mile stretch would have eventually been part of a plan to connect Chicago to the Twin Cities. The following year, the Federal Railroad Administration denied Wisconsin’s application for $150 million for high-speed rail funding. The first public information meetings for the TCMC project will be held Sept. 6 at the La Crosse County Administrative Center, and Sept. 7 at Union Depot. The next steps are to evaluate the alternatives for the project and the necessary infrastructure upgrades. n
Milwaukee Art Museum conservators
KAT SCHLEICHER PHOTOGRAPHY
ON THE JOB WITH…
By Corrinne Hess, staff writer Every day, before thousands of local and out-of-town guests enter the Milwaukee Art Museum, Jim DeYoung and his small team of conservators inspect the art. Some days, their highly-trained eyes spot a tiny scratch on a piece of medieval folk art. Other mornings, their specialized touch is used to dust a 200-yearold painting. “Usually, if something comes down here with damage, our intelligence network missed something,” said DeYoung, the museum’s senior conservator, who
has worked at MAM for 41 years. DeYoung specializes in works of art on paper, although he said he and his staff are all generalists. Generalist or not, the road to becoming a conservator is long, with jobs requiring a master’s degree and years-long apprenticeships, followed by career training throughout the profession. “It takes years to acquire the skills, a light touch and a good sense of observation,” DeYoung said. “Anything I can do to keep these people on board, I do. We are all family.”
Jim DeYoung uses a solution of purified water to wash an 18th century engraved medieval print in a technique called blotter washing.
Tim Ladwig works on a print for the Winslow Homer exhibition at the Worcester Art Museum in Worcester, Mass.
Terri White polishes tarnish off of a piece of folk art.
Rick Knight removes bronze spray paint from a 19th century picture frame to reveal the original material.
DeYoung accompanied this Ernst Ludwig Kirchner painting to an exhibition in Zurich in January and flew back to pick it up at the end of May.
DeYoung in the basement of the Milwaukee Art Museum, where his office and the vaults with additional artwork are located. biztimes.com / 5
@BIZTIMESMEDIA – Real-time news
LEADERSHIP: Jessica Bell, founder and president. She also founded My Wine School.
H E A D Q U A R T E R S: Whitefish Bay W H AT I T D O E S: Shatterproof, stackable stemless wine tumblers F O U N D E D: 2016 E M P L OY E E S: 1 N E X T G O A L S: Get a utility patent and build a production mold FUNDING: Raised $27,000 via Kickstarter; Currently raising $400,000 seed round
Bell makes it happen at HaloVino By Molly Dill, staff writer
6 / BizTimes Milwaukee AUGUST 21, 2017
By next year, Walmart will be selling Milwaukee startup HaloVino’s shatterproof reusable wine tumblers, and they are already in use at the BMO Harris Bradley Center and Miller Park. The company is in the midst of raising its second round of funding, a $400,000 seed round of which $250,000 is already committed. It has design patents in more than a dozen countries, and has sold about 100,000 tumblers. But it has just one full-time employee: founder Jessica Bell. She’s the delivery person, salesperson, product developer and accountant, all rolled into one. “I’m in a conundrum where I’m not big enough to hire anyone, but I’m small enough that I’m drowning,” Bell said. Summer is the busy season. Earlier this month, Bell was making an early morning delivery of 1,000 tumblers to the Wine Pavilion at Wisconsin State Fair Park, where she expected to do about $15,000 in sales during the State Fair’s 10-day run, on her way to Madison to make a pitch to investors as she completed gener8tor’s gBeta program. “It really helped me take the concepts to the next level and become more familiar with the capital fundraising landscape,” she said. Bell spent a year-and-a-half developing the plastic tumblers, which are the same shape as a stemless wine glass, and are stackable and dishwasher safe. The tumblers come in two
pieces that are snapped together by the user, and the “halo” joint forms a hand rest. They’re sold wholesale at $1 per tumbler, several dollars less than competitors. “A lot of people don’t know that the actual glass shape makes your wine taste better,” she said. Formerly an investment banker at Goldman Sachs, Bell spent time as a sommelier and previously founded Milwaukee-based My Wine School, which offered in-person and online wine tasting classes. She noticed at concerts, festivals, on airplanes and at stadiums, wine was being served in regular plastic cups. “Become an expert in something and the ideas will come,” she said. “There’s just a huge industry of people drinking wine in non-glass settings.” HaloVino, which is manufactured at Sussex IM, is now sold in 30 locations in Wisconsin. Bell is starting to develop complementary products and expand into other states. HaloVino is still waiting on its utility patent, which will be key for its investors. To get started, Bell raised $27,000 on Kickstarter in fall 2015 and rolled the product out in summer 2016. Once the seed round is raised, Bell can have a production mold created to produce four glasses at a time, significantly improving its margins. And she’ll be able to hire a few employees. n
IN THE NEIGHBORHOOD How do you choose your locations? Shannon Lopez: “The opportunity arose. The first three stores were takeovers. It sometimes can be much less expensive initially to take over an existing salon because you don’t have to do the buildout and that was our model in the beginning.” ROOTS SALON 5711 Broad St., Greendale 7959 S. Main St., Oak Creek 16750 W. Bluemound Road, Brookfield NEIGHBORHOOD: Greendale Gazebo Square, Drexel Town Square, Brookfield Fashion Center FOUNDED: 2007 OWNERS: Shannon Lopez and Naomi Prusinski EMPLOYEES: 73 SERVICE: Full-service salon
Why did you close your Third Ward salon? “Learning how to grow from two to three is a learning curve in and of itself, and I think we learned that you can’t just open a location
and have instant culture. Our brand is based on the guest experience and extreme value. That location had a little bit of difficulty providing that because parking was a major issue and that doesn’t go along with our guest experience.” You’re bringing on shareholders in 2018? “We’re working with a consulting company on it, but it would be on kind of an invitation basis. We’re also by the end of this year going to be offering 401(k), which is a major milestone in our company. This
year we offered paid maternity, which was another milestone for us. We offer health insurance and vacation pay, all things which are not commonly offered in this industry.” What is driving your growth? “Growing our team. If you don’t have a team member working for you, you can’t service your client. What’s new at Roots? “We are now going to be coming to Wauwatosa on State Street. “We had $3.2 million in revenue this year. Last year was about $2.4 million.” n
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BIZTIMES MEDIA – Connect
B I Z T R AV E L E R : A M S T E R DA M M ARCO BLOEMENDA AL Senior vice president of sales, VISIT Milwaukee
Marco Bloemendaal oversees VISIT Milwaukee’s sales division. He travels regularly for business and leisure. Sometimes, those trips bring him back to his homeland, the Netherlands, and its capital, Amsterdam.
T R A N S P O R TAT I O N : “Arriving at Amsterdam Airport Schiphol, you might be a little overwhelmed. The airport is the third busiest in Europe and fifth busiest in the world for international traffic, as Amsterdam is the ‘gateway to Europe.’ But in all the hectic, you will find the airport to feel compact and easy to navigate. The same goes for navigating in the city. Similar to Milwaukee, the airport is close to the heart of the city – only 11 miles. And once you are in the city, you can tackle it by foot, tram, train, boat and bicycle.”
E XC U R S I O N S: ACCO M M O DAT I O N S AND FOOD:
DENNIS VAN DE WATER / SHUTTERSTOCK.COM
M UNAL OZMEN / SHUTTERSTOCK.COM
“Amsterdam has many famous museums, like the Anne Frank House and Van Gogh Museum. Definite to-dos are a canal tour, flower market, sightseeing the historical buildings and, yes, even the Red Light District. Often, Amsterdam is one of several cities during a trip to Europe but you should go outside the city, as the landscape is completely different. During the spring, visit the ‘Keukenhof’ garden, where 7 million tulips bloom every year.”
T R AV E L T I P : “Biking is not a form of transportation in the Netherlands – it is a way of life. Everywhere you go, you will find bicycle paths. When walking or driving through the city, always look left and right as these bicycles can show up out of nowhere.”
8 / BizTimes Milwaukee AUGUST 21, 2017
“Similar to Milwaukee, everyone knows Amsterdam’s cheese and beer—Heineken, of course— but there is so much more. Explore all the local cafés and when the weather is good, they open the terraces and put the seats in ‘theater style’ so everyone is looking at the street, people watching. If you’re looking for a typical local (lodging) option, try a houseboat—former vessels now converted into homes. Amsterdam is known as the ‘Venice of the north’ with its many canals, so you will find a lot of them.”
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Should the Legislature approve a $3 billion incentive package for Foxconn to build a plant in Wisconsin?
MELISSA K ARIS Audit manager | Vrakas CPAs + Advisors
“All the Light We Cannot See”
CONNECT WITH INTERNS
By Anthony Doerr MELISSA KARIS loves reading, and usually gets wrapped up in murder mysteries. But she recently read a historical fiction novel that made her grateful for her bucolic childhood. Karis, an audit manager at Vrakas CPAs + Advisors in Brookfield, just finished “All the Light We Cannot See” by Anthony Doerr. The Pulitzer Prize-winning New York Times bestseller follows the lives of two European children during World War II. “It starts out centering around this younger girl named (Marie-Laure) and she just recently became
blind and she’s coping with that,” Karis said. “The other part of the story revolves around this younger boy named Werner who lives in Germany. Marie, she has to flee Paris because Germany occupies it.” “It makes you thankful for what you’ve got, but then also … it shows you how even if you’re going through a tough situation, no matter what the situation may be … it teaches you how to handle those situations and how to use what you have and develop personal skills to just adapt and to survive,” she said. n
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You’re the new Milwaukee Urban League Young Professionals president. Why run?
“I’ve been involved with Urban League on and off for a number of years. But I didn’t really get involved officially until the end of last year and it’s something I’m really passionate about, so I decided if I’m going to be involved in an organization, I want to be a leader.”
Why move from nonprofit to for-profit?
Call for Nominations BizTimes Media presents the fourth annual awards program to salute southeastern Wisconsin’s best corporate citizens and most effective nonprofit organizations. The awards will shine a light on excellence in philanthropy and nonprofit leadership. The recipients of the awards will be saluted at a breakfast program on November 2nd, 2017. Nominate the people and for-profit organizations who are making a positive difference in the community by donating their time, talent and treasure. Nominate the nonprofit organizations that are making the region a better place to live, work and play. Self-nominations also are encouraged!
2017 Awards Categories Corporate Citizenship Awards • Corporate Citizen of the Year • Next Generation Leadership • In-Kind Supporter • Corporate Volunteer of the Year • Lifetime Achievement
Save the Date: November 2, 2017
Nonprofit Organizations, Leadership & Support Team Awards • Nonprofit organization of the year (Small & Large Categories) • Nonprofit Collaboration of the year award • Nonprofit Executive of the Year • Social Enterprise
Nominate Today! www.biztimes.com/npawards Nomination Deadline: August 31, 2017 SPONSORS:
“There were budget cuts around that time, so I was a part of the budget cut in the nonprofit world. Just trying to expand my career, I didn’t want to stay in nonprofits. This was an opportunity where I could come in as a manager.”
What draws you to leadership? “My whole focus in my career and where I’m going is I want to be in a leadership position. I’ve always had leadership skills, even through high school and college, playing on sports teams. I feel like people have always looked up to me, making decisions on the run, doing those sorts of things.”
Why return to Milwaukee? “I love the city; I love the community. We get a bad rap from people who have gone to school, gotten degrees, gotten good jobs, they leave the community. And my family’s here. I don’t want to leave my family. I don’t feel as a man of color, a black man in Milwaukee, that we have enough role models who have had the success that I’ve had at this young age.”
In your free time? “I like to sleep. I like going out to the new restaurants in Milwaukee, hanging out with friends. I have a very large family and friend structure. I have four brothers. I have an identical twin – we are the two oldest. I play drums in a couple bands. I’m a huge Packer fan.”
Watching right now? “Power” and “Game of Thrones.”
JORDAN ROMAN AGE: 33 HOMETOWN: Milwaukee EDUCATION: Bachelor’s in sociology and Spanish language studies, University of Minnesota-Morris; Master’s in urban studies and public administration (expected 2017), University of Wisconsin-Milwaukee PREVIOUS POSITION: Financial support services supervisor, Wisconsin Community Services Inc. CURRENT POSITION: Manager, Trustmark Insurance Co.
10 / BizTimes Milwaukee AUGUST 21, 2017
MASON STREET GRILL A D D R E S S: 425 E. Mason St., Milwaukee CUISINE: American grill C H E F: Kenneth Hardiman M O O D: Classic and elegant
While it’s a classic standby in a historic hotel, Mason Street Grill remains fresh. The restaurant updates its menu each season – the summer lunch menu includes margherita flatbread and gazpacho – and has also developed a regular following by retaining favorites like the Signature Chopped Salad and Market Fish. “We do a good job of changing things when they need to be changed,” said Kenneth Hardiman, executive chef, who started in the role May 2. The restaurant, located in The Pfister Hotel in the heart of downtown, can accommodate 150 in the dining room, up to 40 in the bar area, and has two private dining rooms. For dinner, steaks are a top pick, from the 7-ounce petit filet mignon to the 18-oz, 35-day dry aged bone-in rib eye. “I would say we specialize in having something for everybody,” Hardiman said.
PRICING: Lunch entrees, $11-19; Dinner entrees, $14-58; Wine, $28-3,500
2 3 About half of lunch diners order the chopped salad, which includes five lettuces, bacon, hard-boiled egg, onion, tomato, cucumber and avocado dressed with a house mustard horseradish dressing, and can be modified with the addition of tuna, chicken, steak, salmon or shrimp. The dish has been on the menu since day one. “With business professionals, with the chopped salad, it’s easy, accessible to eat,” Hardiman said. “It’s very refreshing as you eat it, with the chopped lettuce and diced vegetables.” The summer menu includes a margherita pizza. Hardiman takes into consideration the season, what’s available and what guests like to set the seasonal menus. The restaurant was remodeled in January for its 10th anniversary, with refurbished booths, new artwork and the addition of a chef’s counter for a front row seat to the kitchen, often with a special themed menu. biztimes.com / 11
BIZTIMES MEDIA – Like us
HOFFMAN YORK OW N E R / DE V E LOPE R : Joseph Property Development LLC A RC H I T E C T S : Rinka Chung Architecture C O N T R AC T O R : Joseph Property Development LLC C O S T S : Undisclosed Y E A R C O M P L E T E D : September 2016
12 / BizTimes Milwaukee AUGUST 21, 2017
AFTER SPENDING NEARLY TWO DECADES on the 16th floor of the 1000 N. Water Street office tower in downtown Milwaukee, advertising and marketing firm Hoffman York Inc. switched gears and moved to a renovated Historic Third Ward warehouse. “The way we work is different,” said Sharon Boeldt , partner and director of earned media. Hoffman York no longer needed rooms for files, but rather convertible space, which it was able to find at 200 N. Water St. The space housed the William F. Eisner Museum of Advertising & Design before it closed in 2010. Hoffman York hired Milwaukee architectural firm Rinka Chung to
design the loft-style office space, creating collaborative work areas for the company’s 75 to 80 employees. A once oversized mailroom at 1000 N. Water St. is now a quarter of the size in the Third Ward location. Employees who have offices are on the interior of the building and the office spaces are smaller, seethrough and don’t have ceilings. Staff members often find a couch to work, or space in the large lunch room area, Boeldt said. “We really got employees involved and engaged before deciding where to move,” Boeldt said. “There are also six other agencies in the Third Ward and we wanted to be part of this thriving area.” n – Corrinne Hess
IN FALL 2014, the YMCA of Greater Waukesha County acquired three branches from
the YMCA of Metropolitan Milwaukee in its bankruptcy reorganization. Earlier this year, the nonprofit began construction on a $2.5 million expansion to its five-year-old Mukwonago facility, along with a $200,000 remodeling project at its Menomonee Falls location. In 2016, it invested nearly $2.3 million in upgrades and new equipment aimed at attracting and retaining members amid the proliferation of for-profit boutique fitness clubs. BizTimes reporter Lauren Anderson recently spoke with Chris Becker, chief executive officer of YMCA of Greater Waukesha County, about what it’s doing to stay competitive. How has your organization been weathering the trend of boutique fitness options popping up everywhere over the past few years? “We’ve found ourselves needing to look at how to be competitive in the marketplace, but still not lose the values of what the YMCA really is – our mission, our commitment to community, to kids, to families. The Y has been around for well over 100 years, but what makes us relevant for young families today? We have to change with the times and adapt to those needs. I’m really proud of what we have accomplished to date and we are very quickly gaining a reputation of being a progressive Y.”
What sets the YMCA apart? “We talk about being a full-facility YMCA. What that means is we cover the gamut for fitness activities, as well as youth and family activities. Every one of our Ys has swimming pools, gyms, fitness centers, child watch areas, multi-purpose rooms. So, with the popularity of these smaller boutique fitness centers – Cyclebar, Orangetheory, 9 Round, yoga and pilates studios – we’re changing some of our square footage to be able to offer many of those types of activities under one roof. “This fall, each one of our five facilities will be outfitted with group cycling bikes, a state-of-the-art technology package with those bikes, and we’ll be changing our group cycling class schedules and class content to become very modern day, cutting edge.”
When you talk about the modern fitness user, are you talking about millennials? “First, we’ve heard from millennials that they want an ease of access, quick-in and quick-out experience. We’re hearing that they want more late evening classes and more weekend classes. I think the conventional 8-to-5 work day is long gone. So it’s maybe not as popular to offer the 6 a.m. class, the lunch hour class, the 5 p.m. class. Work habits are changing, so the Y needs to be more flexible to meet those needs. “Personal training is still popular with maybe a hardcore enthusiast, but small group training resonates with millennials. We’re seeing four-toone training – very small groups in an intense, competitive environment.”
Financially, how has your organization been able to keep rates relatively flat?
Chief executive officer
Have you seen a change in membership?
YMCA of Greater Waukesha County
“Membership now is stable, with the trend of upward growth. We’re starting to gain traction with our marketing efforts, with our repositioning efforts, changes to our schedules and the reinvestment that we’re making.”
LILA ARYAN PHOTOGRAPHY
“That is a testament to our board of directors, our donors and our staff leadership. We went through a real challenging time in southeastern Wisconsin with the challenges from the Milwaukee Y. We had a demonstrated knowhow as to how to effectively run a full-facility family suburban Y, so we had some donors stand behind us and say, ‘We want to keep these facilities as YMCAs, but also we have the answer as to how to thrive – not just hang on, but become new, modern and relevant and connected to the communities again.’”
Employees: About 1,100 www.gwcymca.org
biztimes.com / 13
2212 E. Moreland Blvd., Waukesha
MY TA K E
Should Wisconsin provide a $3 billion incentive to Foxconn?
Taiwan-based Foxconn Technology Group plans to build a $10 billion, 20 million-squarefoot LCD panel manufacturing complex in southeastern Wisconsin. The state is offering a $3 billion incentive package to the company. Gov. Scott Walker’s administration negotiated the deal, which is opposed by some Democrats in the Legislature, including state Rep. Jonathan Brostoff (D-Milwaukee). n
Real Estate Management
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Serving Diverse Tenant Needs OFFICE SPACE WAREHOUSE SERVICE CENTER INDUSTRIAL RETAIL SPACE
365 Cottonwood Avenue, Hartland
Locations in Brookfield, Pewaukee, Hartland, Oconomowoc, Menomonee Falls, Mukwonago, Waukesha, Wauwatosa, and New Berlin
GOV. SCOTT WALKER REP. JONATHAN BROSTOFF
YES NO THE PROPOSAL “It will be the largest economic development project in state history and one of the biggest in the history of our country. Foxconn will have a transformational effect for generations to come in much the same way Silicon Valley transformed the San Francisco Bay Area and the Research Triangle transformed North Carolina. We’re calling it ‘Wisconn Valley.’”
“Look at who we are dealing with: Scott Walker, Foxconn and Donald Trump. First we have Walker, a politician whose credibility on jobs is seriously lacking. Then we have Foxconn, the same company that lied about the factory they were going to set up in Harrisburg, Pennsylvania. Finally we have Trump, who is personally taking credit for single-handedly making this happen. I can think of no politician in American history who has lied more about everything and anything.”
THE INCENTIVE PACK AGE
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“Foxconn invests $10 billion and creates 13,000 jobs paying an average $53,875 per year, plus benefits. In turn, the state provides up to $3 billion worth of incentives. We believe that Foxconn will exceed its goals, but if it does not, it won’t get the full incentive package. There are plenty of safeguards for the taxpayers.”
“For the $3 billion demanded by Foxconn, we can fix every pothole in the state with Wisconsin workers, reduce our public school classroom sizes by hiring hundreds of new teachers, reinvest in our university system (a $15 billion annual economic activity generator), and still have money left over.”
THE FUTURE “The fact that this global corporation chose Wisconsin over every other state in America and every other place in the world should make us feel proud. Our future has never been brighter.”
“A better use of our resources for economic development would be to invest in small businesses already invested in our state and here for the long haul. Not some company that wants to suck as much of our resources as possible, then leave us as quickly as they came.”
Teamwork keeps Sussex IM focused on customers’ problems WALK THROUGH THE AISLES of Sussex IM’s manufacturing facility and it’s easy to lose track of the variety of products being made. One machine might be making water bottles or mouth guards for Nike, while another could be making fan covers or parts for Broan-Nutone. Cosmetic compact cases could come off a line near Briggs & Stratton engine covers. Sussex IM’s own Mr. Lid containers come from the same facility as Purell hand sanitizer dispensers. The custom injection molding company was founded in 1977 as Sussex Plastics Inc. and for years was known for its work in cosmetics packaging. That reputation helped make the company attractive to the British firm Rexam, which bought it in the late 1990s. It wasn’t until the Great Recession hit and Rexam considered closing the Sussex plant that a management group led by Keith Everson, Sussex IM president and chief executive officer, bought the company back and expanded into new markets. “Our hands were a bit tied when we were part of a $6 billion company,” Everson said. “It took forever to get capital approved; nobody wanted to make decisions. When we bought the business, we didn’t have those constraints; we could make fast decisions. We knew the areas that we wanted to grow so we were able to react and our customers really loved that.” Cosmetics once made up 50 percent of the company’s business, but today it accounts for around 8 percent, Everson said. Sussex IM instead spreads its business across a variety of markets, including industrial and
durable goods; health care, hygiene and institutional; consumer goods; and home and garden. The company even has its own line of food storage containers called Mr. Lid, with the top of the container attached to avoid difficulties finding it. “We know what’s in our wheelhouse,” Everson said. “We will venture outside of that, but not too far.” The company recently completed a new 158,000-square-foot advanced manufacturing facility. Everson said the building is being set up with more of a clean room focus, allowing Sussex IM to push into more pharmaceutical packaging and medical device molding. He said across industries, there are companies looking for good suppliers in the United States that can deliver orders on time and in full nearly 100 percent of the time. Sussex IM is looking to do that while also adding value for the customer. In some cases, that means making a part and shipping it to the customer; in others, it means making the product, decorating it, putting it in the final packaging and even shipping it directly to the retailer. Whatever it is, the goal is to solve problems for customers. “If we do a post-mortem on a project and we have not solved a problem, it has not been successful,” Everson said. It takes a lot of coordination and teamwork to keep operations productive and profitable with 500 employees while running 24/7. Everson said it requires a good business system with good metrics and good people. “There’s a tremendous amount of teamwork going on out there to make everything happen,” he said.
Caps for Nike water bottles are produced at Sussex IM.
SUSSEX IM INC.
N65 W24770 Main St., Sussex INDUSTRY: Injection and blow molding EMPLOYEES: 500 www.sussexim.com
One way to help foster collaboration is an area Everson refers to as “the pit.” It is a generally open office space occupied by staff from customer service, inside sales, warehouse management, scheduling and purchasing that makes it easy for people to communicate in-person. “Nobody can hide behind an email or a text message,” Everson said. The teams also hold a meeting around 2 p.m. each day to discuss orders that came in within the last 24 hours to continue their planning. “To me, it’s all about employees and customers,” Everson said. “When we were bought by Rexam, they bought a company, but then they tried to turn us into a plant. There’s a difference between a plant and a company. A company you invite over for dinner; you don’t invite a plant over for dinner at your house. When we bought the plant, we turned it back into a company.” It is a company that has been growing. Everson declined to provide financials, but said Sussex IM has doubled in size since the man-
agement team bought it. But with growth comes challenges. The speed of technological innovation means employees have to adapt to change. Growing the staff also requires reinforcing the team culture that allows Sussex IM to take on a wide range of work for customers. “It’s just constantly communicating, making sure everybody understands the direction the company is going,” Everson said. n
ARTHUR THOMAS Reporter
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@BIZTIMESMEDIA – Real-time news
A rendering of the Fairfield Inn planned in Brookfield. It is one of three hotels being developed in the city.
JON ELLIOTT OF MKE DRONES LLC
Area hotel markets show signs of oversaturation
16 / BizTimes Milwaukee AUGUST 21, 2017
SEVERAL HOTELS have been built in the metro Milwaukee area in recent years, especially downtown. Now, the market is starting to show some signs of oversaturation, just as more hotels are under construction and being planned downtown and in the western suburbs. During an earnings call in late July, Greg Marcus, president and chief executive officer of The Marcus Corp., which operates 17 hotels across the country including three in downtown Milwaukee, said the U.S. Open held at Erin Hills in June saved the quarter for the Milwaukee-based company’s hotel division.
The U.S. Open was a major bright spot for the area’s hotel market, which has seen key data points decline this year. In fact, in the first six months of the year, the downtown Milwaukee hotel market had four months of year-over-year decline in occupancy rates and demand, according to Hendersonville, Tennessee-based hotel market data firm STR Inc. June downtown hotel data showed year-over-year improvement, as did March – when Milwaukee was a host site for the NCAA Men’s Basketball Tournament. For the first six months of the year, hotel occupancy in downtown Milwaukee was 62.6 percent, down 4.9 percent from the same period in 2016. Since January 2012, 1,350 hotel rooms have been added to downtown Milwaukee. That includes the 381-room hotel at Potawatomi Hotel & Casino that opened in 2014 in the nearby Menomonee Valley. Potawatomi is now planning to add a second hotel tower with 119 additional rooms, and several additional hotels are planned or under construction downtown. Those hotels include a 150room, six-story Hyatt Place hotel under construction at The Brewery complex, a 94-room Homewood Suites under construction at 500 N. Water St. and a 200-room Drury
BIRD’S EYE VIEW: B U C K S A R E N A CONSTRUCTION OF THE MILWAUKEE BUCKS arena in downtown Milwaukee continues to progress, with the outer bowl nearly finished and roof enclosure underway. The $524 million arena is halfway complete and will open in time for the Bucks’ 2018-’19 season. Milwaukee Bucks President Peter Feigin said his favorite part is the main entrance off the atrium, which will open onto a public plaza on North Fourth Street. “This will be home to three large buildings all based on food and entertainment,” Feigin said. “We’ll have concerts, festivals and shows.” In early August, the Bucks unveiled the Froedtert & the Medical College of Wisconsin Sports Science Center. The 77,500-square-foot training center includes two full-sized basketball courts, a workout facility and a full-service, chef-staffed kitchen.
Hotel at the First Financial Centre, 700 N. Water St. Plus, Ascendant Holdings plans to convert the Humphrey Scottish Rite Masonic Center building into a 220-room hotel. Across town in the western suburbs, the hotel market data is trending similar to the downtown market this year, with March and June being the only months to see year-over-year gains in occupancy rates and demand, according to STR. For the first six months of the year, occupancy in the western suburbs was 59.9 percent, down 2.8 percent from the same period in 2016. And like downtown, the western suburban area, including Brookfield, is poised to get several new hotels. Coralville, Iowa-based Hawkeye Hotels is planning to build a Holiday Inn Express & Suites and a Fairfield Inn & Suites by Marriott at The Corridor development along I-94 in Brookfield, which will add 132 and 137 rooms, respectively. The City of Brookfield is also working on a conference center with an adjacent 175-room hotel development in the Brookfield Square parking lot. In addition, Milwaukee-based HKS Holdings LLC is developing a 120-room SpringHill Suites by Marriott hotel at Milwaukee County Research Park in Wauwatosa. Greg Hanis, a hotel industry analyst and president of New Berlin-based Hospitality Marketers International Inc., said the sudden urge to build hotels, particularly in Brookfield, is puzzling. “The reality is the lodging demand really isn’t growing at all. I think this is a game of chicken of who is going to build all of these hotels first,” Hanis said. One thing that has not yet taken a hit is the average daily room rate. In downtown Milwaukee, room rates averaged $138.31 per night for the first six months of the year, up 4.9 percent over the first six months of 2016, according to STR. In the western suburbs, the average daily rate was $102.96 for the first six months of the year, up 7.5 percent over the same period
last year. But Hanis worries with new hotels coming online, older hotels will have to start discounting their rates to keep occupancy rates from falling further. “There needs to be a moratorium (on new hotels) for the next three to five years so the existing rooms can be absorbed,” Hanis said. “The pressure is going to be on to fill these rooms.” Brookfield currently has 14 hotels. Adding 444 more rooms and three more hotels has been a concern for the existing hoteliers, said Carol White, president of the Greater Brookfield Chamber of Commerce. Brookfield officials want to get a hotel and conference center built in the city. They originally considered having the conference center and hotel built at Irgens Partners LLC’s site for The Corridor development, which hotel operators were OK with, White said. But the site was dropped when it became clear there was not enough space for parking, and it was understood by hotel operators that Irgens might still build a hotel at the Corridor, she said. But when plans were announced to build two hotels at The Corridor site, Brookfield’s existing hotel operators were very surprised, White said. “I am a believer in the free market and encourage business, but we have had low occupancy across the board,” White said. “I don’t believe we have enough demand to bring three more hotels into the market.” n
HERITAGE HOUSE Gorman & Co. Inc. is moving forward with plans to renovate the 102-year-old Heritage House Inn building in Kenosha into an 80-room boutique hotel. The dilapidated, 35,000-square-foot Heritage House building will undergo a complete makeover, which will also include a new addition. Features will include a pub-style restaurant, a rooftop bar, and a 4,000-square-foot banquet hall and ballroom. Construction is expected to be complete in early 2019. The hotel is expected to employ up to 75 people. DEVELOPER: Gorman & Co. Inc. LOCATION: 5706 Eighth Ave. in downtown Kenosha COST: $25 million
CORRINNE HESS Reporter
P / 414-336-7116 E / email@example.com T / @CorriHess
biztimes.com / 17
RY TO S R
By Arthur Thomas, staff writer t was almost as if Gov. Scott Walker couldn’t believe it himself. Speaking at the White House announcement of Foxconn Technology Group’s planned investment in Wisconsin, he described it as a $10 million project. House Speaker Paul Ryan quickly leaned in and corrected the governor. “Excuse me, 10 billion,” Walker said. “I’m glad Paul Ryan is keeping track of millions and billions.” It’s easy to see how Walker may have slipped for a second. Wisconsin economic development projects aren’t normally announced at the White House and they don’t reach into the billions of dollars. The projects in the state’s largest tax credit program have averaged $80 million during Walker’s time in office. 18 / BizTimes Milwaukee AUGUST 21, 2017
Foxconn chairman Terry Gou and Gov. Scott Walker hold up a memorandum of understanding spelling out terms of the companyâ€™s Wisconsin investment. biztimes.com / 19
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Foxconn chairman Terry Gou at the Milwaukee Art Museum
FOXCONN TECHNOLOGY GROUP Taiwan Contract manufacturing NOTABLE PRODUCTS: iPhone, iPad, Nintendo 3DS, PlayStation, Wii U, Xbox FOUNDER: Terry Gou (chairman) FOUNDED: 1974 EMPLOYEES: More than 1 million 2016 NET PROFIT: $4.9 billion 2016 REVENUE: $144.6 billion HEADQUARTERS: INDUSTRY:
PURCHASED SHARP IN 2016
FOR $3.5 BILLION
The deal is remarkable for its size, but also for its speed. It was just 90 days from Walker’s first meeting with Foxconn chairman Terry Gou to the White House announcement. During those three months, the governor and the chairman developed a relationship those involved describe as a key reason the technology giant chose Wisconsin. They also put together a deal they believe will transform the state’s economy for decades to come. The Taiwanese multinational electronics contract manufacturer, which makes products including the iPad, iPhone and Xbox, is to create 13,000 jobs and invest $10 billion in a liquid-crystal display 20 / BizTimes Milwaukee AUGUST 21, 2017
(LCD) panel manufacturing campus over a six-year period in exchange for $3 billion in tax incentives from the state. Gou and Walker say the complex will initially have at least 3,000 jobs and grow from there. The incentive package is contingent on hiring and capital investment. That level of incentive is unheard of in Wisconsin. For perspective, the Wisconsin Economic Development Corp. has awarded a total of $1.73 billion in tax credits, grants and loans since it was formed in 2011. The size of the incentive for Foxconn has raised some concerns. It will take 25 years for the state to recoup its investment in Foxconn, according to the Legislative Fiscal Bureau. “The $3 billion subsidy is one of the highest given to any company by any state,” said Marquette University economics professor Abdur Chowdhury. “Foxconn was successful in playing one state against another and squeezing as much subsidy as possible. Any future company coming to Wisconsin will use this precedent to get as much tax and other benefits from the state as possible. “Foxconn is no doubt a big investment and could be a game changer. (But) despite the hype,
Foxconn’s investment in Wisconsin does carry some downside risks.” If Foxconn lives up to the hype, it could put Wisconsin on the map globally with the first LCD flat panel display factory in the United States. The project is expected to generate another 11,500 jobs at Foxconn suppliers and almost 10,800 jobs at businesses selling to employees, according to an EY report commissioned by the company. Foxconn could spark the creation of an ecosystem of companies and economic growth that draw people from around the country and around the world, Walker says. The state would evolve from a heritage of bending metal and brewing beer to a focus on the leading edge of electronics technology. Walker is calling the ecosystem that will develop from the presence of Foxconn’s complex “Wisconn Valley,” predicting an impact on the state akin to Silicon Valley in California. Tech workers flock to Silicon Valley for the abundance of job opportunities there. Supporters of the state’s deal with Foxconn say the same thing could happen in Wisconsin. “This is an international play to get workforce here,” said Mark Hogan, secretary and chief executive officer of the WEDC. If Foxconn becomes an economic magnet that draws people to Wisconsin, reversing decades of trends toward net outmigration, businesses in the
TERRY GOU AGE:
1974 with $7,500 NET WORTH: $7.5 billion (ranks #182 on Forbes magazine’s world billionaires list) FOUNDED FOXCONN:
state, which has an unemployment rate of 3.1 percent, could have an answer to their workforce challenges.
Living up to expectations But several pieces need to fall into place for the deal. Foxconn has to hit its own capital investment and job creation targets to receive its tax incentives. Those credits are expected to be paid out at around $200 million to $250 million per year over a 15year period. Wisconsin’s manufacturing and agriculture tax credit would already eliminate much of the company’s tax liability and the incentives are refundable, meaning the state would be cutting Foxconn a check each year for the incentive. The Foxconn complex will support a significant supply chain, which would benefit Wisconsin companies and attract dozens of companies to the state. That possibility will be one of the most important keys to making the massive state investment in Foxconn worthwhile. “There needs to be substantial follow along investment from the supply chain,” said Scott Andes, a fellow at the Anne T. and Robert M. Bass Initiative on Innovation and Placemaking, a collaboration between the Brookings Institution and the Project for Public Spaces. “This is a significant gamble. For these things to pay off, you need to build not just one company … you need to build a number of smaller and medium-sized companies.” Hogan and Scott Neitzel, secretary of the Wisconsin Department of Administration, stress their goal during negotiations with Foxconn was to get a good deal for the state. “It had to make sense for the taxpayers of Wisconsin,” Neitzel said. Asked about the potential refund payments to Foxconn, WEDC spokesman Mark Maley pointed to the expected $116 million in annual state tax revenue paid by Foxconn employees, along with the indirect and induced jobs, and described the deal as “a once-in-a-lifetime economic development opportunity.” “The return on that investment will continue well beyond that 15-year period and will pay dividends to the state for generations to come,” Maley said.
But will Foxconn follow through with its Wisconsin plans? Andes said it “is increasingly the norm for Foxconn” to announce big investments that don’t live up to the hype. That’s included projects in India, Vietnam and Brazil. A planned $1 billion plant in Indonesia didn’t become a reality and neither did a much-heralded $30 million investment in Pennsylvania. “There is no reason to believe that they will follow through with their promises in Wisconsin,” Chowdhury said. However, unlike the company’s plans in Wisconsin, the Pennsylvania project didn’t involve any state incentives, Andes said. Hogan said state officials spent enough time with Foxconn leaders to have confidence in the project and are also encouraged by the amount of time the company spent in the state. “We addressed those situations with them directly and were extremely satisfied with the answers we got,” Neitzel said. Mike Knapek, CEO of Waukegan, Illinois-based Yaskawa America Inc., said the planned Foxconn project is more geared toward the company’s Sharp business, not its traditional contract manufacturing focused on smartphones. The combination of the project size and the fact that Foxconn is functioning as an OEM after acquiring Sharp last year for $3.5 billion give him confidence the Wisconsin project will become reality. “This one is significant enough that I would be very surprised if it doesn’t materialize,” he said. Japan-based Yaskawa makes industrial robots, motion control systems and drives used in a variety of industries, including Foxconn plants in China and Japan. Knapek said the flat panel display business isn’t quite as cost sensitive or competitive as smartphones, improving the likelihood of success for the Wisconsin campus. In addition to tax
incentives, Neitzel and Hogan pointed to the relationship between Walker and Gou as a reason for the deal coming together. “It was evident that both the governor and Terry respected each other and found each other to be engaging and interesting and they just hit it off,” Neitzel said. Gou said as much during the recent event welcoming Foxconn at the Milwaukee Art Museum. He recounted stories from the dinners the two shared with their teams during their negotiations and the governor’s willingness to work through the weekend during his trip to Japan. “I’ve never seen this kind of governor or leader yet in this globe, in this world,” Gou said. Beyond leaders, Gou said he chose Wisconsin for its people. “We like the people here … we like your traditional industry foundation,” he said, noting he made visits to Rockwell Automation Inc. and GE Healthcare during trips to the state.
Finding Foxconn’s workforce Wisconsin’s people and its workforce may have been enough for the state to land Foxconn, but filling the 35,000 projected jobs associated with the project will take an even bigger collective effort. Many business leaders have referenced raising the bar or companies having to raise their game in response to the workforce challenges. Earl Buford, CEO of Employ Milwaukee, said the increased demands on the workforce system will push wages up and create an
The scene at the Milwaukee Art Museum during the Wiconsin Foxconn announcement. biztimes.com / 21
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Foxconn is expected to pay in wages and benefits annually when fully staffed.
Foxconn employees and the indirect and induced jobs created by the campus are projected to generate
in state tax revenue annually.
Through March, the Wisconsin Economic Development Corp. has awarded $1.73 billion in tax incentives, grants and loans since its creation. Foxconn could receive
3 billion in incentives.
Staffing the estimated
connected to Foxconn only from Wisconsin’s current unemployment pool would drop the unemployment rate to 1.95 percent. The Foxconn campus is projected to contribute
to state GDP when fully staffed, a 1.6 percent increase. Source: Foxconn commissioned economic impact study by E.Y.
expanded economic base, but it will also require a more systematic approach. “It’s going to raise the bar on how we recruit people,” said Buford, the head of the Milwaukee County public workforce organization. The region’s workforce systems have done a pretty good job of getting people into a first job and are working to improve on getting people into better jobs, Buford said. The arrival of Foxconn will force businesses and organizations to address the movement of workers from $12 an hour jobs to those that pay $15, or from the latter to even higher paying jobs. “It just becomes real cyclical,” Buford said, noting the shifts can cause concerns for businesses. “We have to really solve their fears of that.” The first step to addressing Foxconn-related workforce needs will be understanding the company’s needs, including what kind of low-, medium- and high-skill positions will be needed. “To me, that’s the first thing any workforce project needs to do,” Buford said. “If you don’t do that, you’re just kind of working in a vacuum.” The company plans to hire more than 9,800 hourly technicians and operators, 1,600 process equipment engineers, 820 business support employees, 463 integration engineers and 300 computer-integrated manufacturing engineers. The largest percentage of indirect and induced jobs will be in trade and transportation, at about 23 percent. Another 18 percent will be in business services, with a similar percentage in hospitality. Professional and financial services will account for roughly 17 percent of the jobs, while health care and education will be nearly 13 percent of the roles, and construction and utilities will account for 5 percent, according to the EY economic impact report. Manufacturing is projected to account for just 6 percent of the jobs created beyond Foxconn. Buford said the structure is in place to fill the workforce needs. Employ Milwaukee, the Southeast Wisconsin Workforce Development Board and the Waukesha-Ozaukee-Washington Workforce Development Board established an alliance a couple years ago. The needs of companies like Amazon, which itself is hiring for 1,500 positions
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in Kenosha, and others in the region prompted the partnership. Collaboration among nonprofits, government leaders and businesses will be key to meeting the Foxconn complex’s workforce demands, Buford said. “We have to now, otherwise it’s going to be pretty tough to achieve this,” he said, adding he would be “thoroughly disappointed” if those involved in workforce development don’t start with Foxconn-oriented meetings in the near future. Metropolitan Milwaukee Association of Commerce president Tim Sheehy acknowledged Foxconn will stress the region’s workforce. “There’s two responses: we either pedal faster or quit pedaling,” he said. “It’s also going to draw talent to Wisconsin that’s not here because of this technology.”
Findorff creates innovative spaces .
Creating the ‘Wisconn Valley’ ecosystem The Foxconn campus will have about 15 buildings, including a generation 10.5 LCD fabrication facility, along with liquid crystal module assembly and final TV assembly operations. “TV was invented in America, yet America does not have a single LCD factory to produce a complete 8K system. We are going to change that,” Gou said during his remarks at the White House. Gou and other Foxconn leaders say 8K technology, however, goes beyond making the next generation of big screen televisions, especially when combined with 5G cellular networks. During the Milwaukee Art Museum event, the company showed off videos of how 8K technology can help with surgeries, allowing for safer, faster and cheaper procedures. The company also has screens for automotive applications and Gou discussed applications of 8K and 5G to drive productivity improvements in industry. “8K is not display; 8K is not TV; it’s technology,” Gou said. Hogan said the company was considering the U.S. for two different projects and the one Wisconsin won is focused on the production of larger screens. “They had an increasing level of confidence that Wisconsin could make two phases into one, basically,” he said, adding it was about two weeks before the announcement that negotiations arrived at the job and capital expenditure figures to which Foxconn committed. Beyond the potential influx of workers, proponents of the Foxconn deal have touted the creation of an ecosystem surrounding the company as suppliers potentially make investments to be close to the facility. “Wisconsin now stands at the epicenter of a high-tech industry that simply does not exist in the United States today,” said Gale Klappa, chairman of WEC Energy Group and a co-chair of Milwaukee 7. Sheehy and Milwaukee County Executive Chris Abele said the company’s supply chain could have 150 to 170 companies who might make in-
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vestments in “Wisconn Valley.” S “To me, anywhere in the WI state this happens, everybody’s going to benefit,” Abele said. “The whole supply chain stuff is epic.” Foxconn already signed a memorandum of understanding with Rockwell Automation Inc., pledging to use the company’s Industrial Internet of Things technology in its campus. Foxconn also will participate in a veteran training partnership Rockwell has with ManpowerGroup. When the Foxconn deal was announced, Rockwell CEO Blake Moret said it would put the state “at the center of next generation manufacturing for the foreseeable future.” “That’s good news for business, for customers and for talent,” he said. A Rockwell spokesman declined to comment further on Foxconn’s arrival, saying the company was limiting its comments to the announcement of the partnership. Steve Williams, chair of the electrical engineering and computer science department at Milwaukee School of Engineering, said the Foxconn plant will likely be highly automated and Wisconsin has the knowledge base to help the company. “Wisconsin is very well-known for its automation industry. There’s some leverage there for Foxconn,” he said, although he added the project could
take things to a new level. “This is probably one of the most advanced manufacturing processes that Wisconsin would have.”
Driving others to advanced manufacturing The arrival of more advanced manufacturing by Foxconn could spread to other manufacturers in the state. Tim Wiora, executive director and CEO of Wisconsin Manufacturing Extension Partnership, said when an international OEM locates in a new place, everyone in the area is forced to improve their productivity and that would likely be the case in Wisconsin, especially given the projected workforce demands. “They’re probably going to have to pay their workforce more to retain them,” Wiora said of small and medium manufacturers. “They’re going to have to get the money from someplace else.” He said there is an opportunity for WMEP, which has been working with the state on a tool for evaluating manufacturer productivity, to help companies figure out the right places to invest. Foxconn could also serve as a catalyst for some businesses. “There’s a hesitation in some small and midsize manufacturers to really look at robotics; this might prompt that to some degree,” Wiora said. Knapek said Foxconn’s normal cost structure is
more Asia-based, meaning the U.S. cost structure will likely be higher than it has dealt with elsewhere. “They’re not going to come in here throwing money around,” he said, adding efforts to attract talent will be focused on creating the right culture and productivity. Knapek, who was part of some meetings with the company, said at one point Foxconn officials discussed potentially needing to hire 5,000 engineers, and that the company’s presence would drive attention to science and technology fields. “I think Wisconsin has a lot of traditional skillset in this area,” he said. “It’s really going to drive the universities to add students.” Foxconn also presents plenty of opportunity for Wisconsin manufacturers and other businesses. Foxconn is expected to make about one-third of its $4.26 billion in supplier purchases within the state of Wisconsin, a $1.42 billion opportunity, according to the WEDC. Mark Muro, metropolitan policy program senior fellow and policy director at the Brookings Institution, said the Foxconn project might force the development of some supply chain capabilities that don’t currently exist. “There may be growing pains in rebuilding or building anew the kind of supplier relationships that may be required,” he said. Andes pointed out the $3 billion in tax incentives will be going to Foxconn, not toward building
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Foxconn’s campus is expected to result in 22,000 indirect and induced jobs. Here’s a breakdown of the industries in which those are expected: Trade & Transportation 24% 23.
Construction & Utilities
Healthcare & Education
the supply chain – at least not directly. “We’ve seen this all over the country where this doesn’t always pan out,” he said. Muro and Andes pointed to Google’s effort to make Moto X smartphones in Fort Worth, Texas. Harvard Business School professor Willy Shih detailed some of the challenges the facility faced in a 2014 MIT Sloan Management Review article. Google had to use six employment agencies to recruit applicants and hire 6,500 workers over 10 weeks to eventually fill 2,500 jobs. Shih noted the shift of the electronics supply chain to China and Asia over the past several decades meant Google faced “a hollowed-out supply base” and most components had to come from Asia. “Rebuilding a supplier ecosystem takes commitment,” Shih wrote. “It means adopting a strategic view of supply relationships, rather than a transactional view. The long-term development of capabilities becomes far more important than short-term haggling over price.” The Fort Worth plant closed a little more than a year after production started amid tough competition, higher costs and Google’s sale of the company to Lenovo. “Foxconn is not a dumb company,” said Doug Fisher, director of Marquette University’s Center for Supply Chain Management, noting the company has been able to operate with Apple over a long period with large-scale production. “My guess
Hospitality & Other Service
Professional & Financial Services
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is Foxconn has this reasonably well figS ured out.” WI Fisher said the company would look to co-locate its suppliers in the area of the facility. The area would attract entrepreneurs, investment and intellectual capital, as well. Abele said the company’s presence would benefit the region’s startup community as firms form to try to meet Foxconn’s needs. “There already has been coastal money moving into the Midwest, but this is going to put gasoline on the fire,” he said, adding there would also be the potential for spinoffs, as has been the case with Epic Systems in Verona. “It’s that on steroids.” Fisher said Foxconn would likely bring many suppliers with it in an effort to keep short supply chains, but he added that for existing Wisconsin manufacturers “if you relate at all to Foxconn, you will be trying to do business with them.” Knapek said the company would likely rely on its current suppliers initially and transition to U.S.-based suppliers as industries become more established. “Most companies … they like to stay with what they know works,” he said. Wisconsin, and for that matter the U.S., does not have much recent history with production related to LCD panels, and the Foxconn plant has
been presented as the first flat panel display factory in the U.S. The semiconductor and electrical component manufacturing industry, under which LCD panels fall, accounts for just 3 percent of the nation’s manufacturing employment and just 1.4 percent in Wisconsin. The broader industry group of computer and electrical product manufacturing makes up just 5 percent of state employment. The state’s manufacturing sector employment is dominated by three main industries – metal fab-
Williams said in addition to electronics and automation, the Foxconn project will need glass and plastics. Corning Inc. plans to build a $1 billion, 400job glass manufacturing facility near the Foxconn complex in Wisconsin, according to Metropolitan Milwaukee Association of Commerce president Tim Sheehy. Plastics manufacturing is an established industry in the state that could benefit from Foxconn’s presence. Wiora said he expects state businesses to
“We have a good work ethic,” he said. “When pressed, we will innovate our way out of it.” rication, food manufacturing and machinery manufacturing – which account for nearly 45 percent of employment. Even without a heavy focus on electronics, Wiora said Wisconsin manufacturers will adapt to find ways to supply Foxconn. “I don’t think you can ignore the fact that this major OEM is coming into the state,” he said, suggesting the sooner companies can begin understanding what they need to do to become a supplier, the better.
rise to the occasion. “We have a good work ethic,” he said. “When pressed, we will innovate our way out of it.” Hogan and Neitzel said the opportunity for the state continued to grow as negotiations with Foxconn continued. They said Wisconsin companies are set up to handle the potential disruption and have already been working to improve their productivity. “This is a natural extension to who we say we are right now because the manufacturing is in our blood,” Hogan said. n
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Working with experts integral to building a new facility by Jerry Schlitz Once Michael Floyd and James Caragher, the owners of Glenn Rieder, broke ground in April for their new 120,000-squarefoot facility in West Allis, work kicked into high gear to keep the expansion as efficient as possible. Although Glenn Rieder is in the construction industry as an architectural millwork manufacturer and custom interior contractor, Floyd and Caragher had never built their own manufacturing facility, nor had they designed a modern and efficient office environment. They found, however, that being surrounded by the right experts and putting together a solid plan are integral to any business planning to construct a new facility.
Jerry Schlitz Senior Vice President, Commercial Banking Park Bank Web: ParkBankOnline.com Social: facebook.com/ ParkBankOnline twitter.com/ parkbankonline linkedin.com/in/jschlitz Contact: JerryS@ParkBankOnline. com (414) 616.4367
One of their first moves after deciding to build a new facility was to hire John Mann, a local construction manager, to serve as the company’s eyes and ears on the project. “From our experience with customer projects, we saw that the most successful ones had construction managers who worked for the project owners,” Floyd said. “They looked out for the owner and their interests.” The construction manager also allows Floyd and Caragher to stay focused on running the company, rather than constantly worrying about the ins and outs of the building project, including managing the architect and general contractor. They remain involved to a degree, but the construction manager handles the details. Floyd and Caragher knew that efficiency has suffered in the company’s current confined manufacturing facility. To remedy that, they enlisted the help of a process engineer who is looking at machinery and equipment Work is underway at the Glenn Rieder site in West Allis. placement, fabrication processes and how Glenn Rieder’s employees currently work to develop the most effective layout for the new factory floor. The process engineer will also coordinate and plan the company’s physical move in February of 2018. To help with the overall office design, including workstations, they enlisted Zimmerman Architectural Studios, another Park Bank customer. They also asked some of their department heads what they imagine their employees’ workspace needs might be in five or 10 years. “Our industry has changed. We are moving toward a paperless world and no longer need large tables to roll out architectural plans,” Floyd said. “Instead, we need desks and work areas large enough to accommodate multiple computer screens. We are also designing work areas and a common space to promote collaboration and strengthen communication among employees. Zimmerman is helping us design what is best for our employees and visiting job partners.” For business owners building a new facility, Floyd sums up what he’s learned from this experience: “Surround yourself with the professionals who have the expertise to make your project a success.” Glenn Rieder designs, manufactures and installs custom architectural millwork and interiors for resorts, luxury retailers, restaurants and commercial offices across the United States
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Special Report OFFICE SPACE
The office building at 1433 N. Water St. has energy-efficient features including geothermal HVAC, a solar array on the roof and energy-efficient windows.
Smarter buildings on the rise By Lauren Anderson, staff writer IF TEMPERATURES get a little too toasty in the offices at 1433 N. Water St. in downtown Milwaukee and they need to come down ASAP, there’s an app for that. “Our maintenance engineers and property managers are able to access real-time building information and the viability of each piece of equipment in the building through an app on a phone or through a dedicated secure laptop – one in the building and one they carry with them,” said Anne White, development executive assistant with Wangard Partners Inc., the developer and owner of the building. “So at any moment, if something goes wrong, they’re alerted immediately.” The recently redeveloped 115,673-squarefoot office building – formerly the site of Brookfield-based Laacke & Joys Co. LLC’s industrial sewing division – is among a growing number of buildings joining the ranks of “smart” or “intelligent” buildings. Such buildings rely on internet-connected devices to collect and communicate data that owners and managers use to optimize their building operations. “Smart buildings are about data driving building technology and transformation and the power 28 / BizTimes Milwaukee AUGUST 21, 2017
of that data to create value for building owners, their managers and their occupants,” said Dave Eidson, vice president of global advanced development and technology platforms for Johnson Controls Inc. When Wangard set out to redevelop 1433 N. Water St., energy efficiency was a top priority, White said. So the firm chose a geothermal HVAC system, a solar array on the roof, and installed energy-efficient windows – features that are expected to save $1 per square foot annually. And to help manage, monitor and remotely control the building, managers and engineers
operating as it’s intended so that can be corrected,” White said, “(compared to) a year down the road, when a faulty piece of equipment has used eight times the amount of energy that it should have.” The immediacy of the alerts allows engineers and building managers to rectify a problem before tenants even realize something is amiss. And that translates to happier customers, said Burton Metz, vice president at Wangard. “The goal of a lot of these sustainability features is for tenant satisfaction, as well as employer retention,” Metz said. “In order to have happy
“Smart buildings are about data driving building technology and transformation and the power of that data to create value for building owners, their managers and their occupants.” — Dave Eidson, Johnson Controls Inc.
have access to data using a mobile app or computer, which provides real-time information related to room temperatures, water usage and the status of equipment. “We can pinpoint equipment that may not be
employees here, you’re going to want to have comfortable HVAC and consistent HVAC as part of the building.” Wangard is in good company as building managers increasingly turn to Internet of Things
solutions to enhance their energy management and operational efficiency. A study from Navigant Research projects the global IoT for intelligent buildings market to grow from $6.3 billion in 2017 to $22.2 billion in 2026, with North America representing the second-largest share of the market. The trend also has introduced some challenges, particularly related to cybersecurity. Smart buildings connect internal systems with external networks to monitor and manage building operations – compared to an older model, in which those systems were installed in silos. “The smart building is about free-flowing, pervasive connectivity of systems and the networks that those systems ride on,” Eidson said. “And that pervasive connectivity between these systems and their networks is what increases the cyber risk attack surface. It’s a pretty significant increase.” And while not every connected product is valuable itself, the access to it could create entry points for more sensitive information to be exploited. “Smart buildings have to think about pro-
tecting against denial of service or data theft, ransomware, hijacking of command, and control of equipment. How is a vendor of IoT products compromised if their product is compromised?” Eidson asked. He contends it’s no longer enough for buildings to be smart; they need to also be “cybersmart.” “Cybersecurity has to become a core tenet of building designs, operations and lifecycle management,” Eidson said. He said implementing cybersmart practices requires a building operator to look at his or her specific challenges, change company culture to understand the importance of cybersecurity, and be prepared for the continually evolving risk of cyber breaches. “This is a huge culture change,” Eidson said. “They’re used to buying once, getting through the warranty period and then in 15 to 20 years, potentially upgrading the building through a major renovation. Cyber security doesn’t allow us that luxury any longer. We have to keep the software in our systems current to the ever-changing landscape of threats.” n
The office building at 1433 N. Water St. has a solar panel installed on its roof to promote energy efficiency.
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Special Report OFFICE SPACE
Zizzo Group’s glass-enclosed offices are on an interior wall instead of the perimeter.
Adding privacy to the open concept Adaptability key in modern office By Molly Dill, staff writer FLEXIBILITY is the name of the game in office design these days. With the mobile nature of today’s workplace technology, employees can work anywhere from a traditional private desk setting, to a table in the company café, to a comfy couch in a living room-like setting. While the trend toward open concept design has not gone away entirely, the pendulum has swung back in the direction of providing heads-down spaces for individual concentration, as well, said Dean Stier, vice president of marketing at West Allis-based National Business Furniture LLC. “I think the shift is really coming more into a balance,” he said. “Moving away from cubicles is really about creating collaboration between people. A lot of companies went too extreme. I don’t think the open concept is really going away so much as being refined.” Employers are interested in creating spaces that can serve many purposes. This is accom30 / BizTimes Milwaukee AUGUST 21, 2017
plished through the use of rolling desks and nesting and flip-top tables that can be stored easily when not in use. “What we’re starting to see people do is just create little areas of privacy where you might have maybe a chair that almost looks like a phone booth,” said Rick Wachowiak, general manager at NBF. “We’re just seeing people adjust and add in some spots for privacy now, since everything else is so open.” Matt Rinka, principal at Milwaukee-based Rinka Chung Architecture Inc., has also noted a desire for adaptable office design. “The ability to have spaces that are much more varied is definitely something we’re seeing in the industry,” he said. “I wouldn’t say the open office concept is going away. It’s still part of many of the office spaces we design.” Standing and adjustable-height desks have continued to gain in popularity. NBF saw a 10 percent increase in customer orders for the category from 2015 to 2016. “We’re seeing more and more customers introduce standing height solutions,” Wachowiak said. “We’re also seeing people move to a standing-height desk for a conference room.” Treadmill desks, on the other hand, have not taken off as much. But employees seeking other active options have been drawn to balltype seating and stools. “We’re learning more about a new area,
which is active sitting,” Stier said. “You’re basically perched in a neutral standing position, but you’re not putting all your weight on your feet, on your spine.” Comfort is a priority, with more soft seating, mixed materials and homey décor in office spaces. “We’re introducing more and more lines that you could almost call them more residential,” Wachowiak said. “Whether it be someone working at home or whether they just want to feel at home in their office, those lines are taking off.” Working in a more casual area can encourage creativity and collaboration, Rinka said. “The ability to move around is not only something we’re seeing, it’s really being pushed by especially the younger generation that want to work in that manner,” he said. “The idea that the traditional work environment has to include this hardwired phone, hardwired computer – people are just working differently and the environment has to adapt to that.” Newer office designs eschew the concept of the corner office, instead placing the offices in the middle and surrounding them with glass. In this way, natural lighting can filter into the whole office. “What’s happening to the workplace is that instead of these rigid offices where you have executives on the perimeter and employees
in the middle in these cubicle farms, you have this more free open space,” Stier said. “The idea is really getting people together and really colliding in a space and getting comfortable in sharing ideas.” Rinka Chung has recently designed several office spaces that shift the offices to the middle of the room. One example is Zizzo Group’s offices, which were completed in February 2014. “The offices themselves and all of the meeting spaces are all oriented to be able to expose the windows and the views to the east and the south,” said Anne Zizzo, chief executive officer. “The offices, (Rinka) and the group designed to be on an interior wall so they could be sitting at their desks and looking out to the windows.” Each of Zizzo’s 35 employees has a cubicle or an office, and the 15,000-square-foot open concept, two-story workspace also has open collaboration zones, heads-down spaces and a café. “We really wanted a creative space, a space that would stimulate creativity not just for our own staff, but for our clients as well,” Zizzo said. n
Active seating is becoming a popular companion to standing desks.
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A vision that sparked downtown development By Corrinne Hess, staff writer IN DECEMBER 2012, Northwestern Mutual Life Insurance Co. announced it would build a new office tower at its corporate headquarters campus in downtown Milwaukee. The news was one of the most significant announcements in the company’s history, and one that also caused a ripple effect throughout downtown that has lasted for nearly five years. Northwestern Mutual’s decision to build the $450 million, 32-story tower in Milwaukee let the public know the company believes in the city. It also sent a signal to the development community that after one of the worst recessions in history, it was OK to begin to invest and build again. There have been several key developments over the past few years in Milwaukee, but Northwestern Mutual’ s new tower is probably what has spurred a great deal of the construction now taking place downtown, said Rocky Marcoux, commissioner for the Milwaukee Department of City Development. “Northwestern Mutual is one our great corporate citizens,” Marcoux said. “They have been great corporate citizens to the City of Milwaukee for the many decades they’ve been here.” Eric Christophersen, Northwestern Mutual’s vice president of facilities, said the company’s decision to build what is now one of the state’s largest buildings, coming in at 1.1 million square feet, was not based solely on Milwaukee, but rather on its business needs. That said, the company is happy to be a new addition to the city’s expanding skyline. “The fact that we have been credited for spurring more development is very flattering, but what we did was for business purposes,” Christophersen said. “Still, we cannot wait for The Couture project to begin and are thrilled about the new Bucks arena and the new Westin hotel opening. It is a great time to be in Milwaukee.” The decision to build a new office building downtown versus in Franklin, where Northwestern Mutual has its other corporate campus and more than 2,000 employees, was a confluence of events that began with its aging and deteriorating East Building, constructed in 1978, at the downtown campus. The new tower is located at the southeast corner of biztimes.com / 33
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North Cass and East Mason streets where the former 500,000-square-foot East Building once stood. Northwestern Mutual was founded in Janesville in 1857 and moved to Milwaukee in 1859. The company built its iconic East Wisconsin Avenue office building more than 100 years ago. “We had an opportunity to take a step back and think about what we wanted to do: fix our aging building or, perhaps, consider something different,” Christophersen said. The executive team wanted to build a headquarters tower that would make a statement. They also wanted it to be structured and designed for a workforce of the future. Attracting and retaining millennials and being able to offer employees state-of-the art technology were top of mind when designing the building. “It’s not just about building office space to conduct business in, but strategic thinking about how we do business and how do we build out a space in a way that we maybe haven’t thought about in the past,” Christophersen said. The decision to build a new tower in downtown Milwaukee came after years of strategic planning, Christophersen said. The construction of the new building preserved 1,100 Northwestern Mutual jobs in downtown Milwaukee and also created space for approximately 1,900 new ones, according to the company. Since construction began three years ago the project has also created more than 2,600 construction-related jobs. Because the city committed $54 million in tax incremental financing for the project, a quarter of the contracts have had to be awarded to local companies eligible under the city’s Small Business Enterprise Program and at least 40 percent of the labor hours have to be worked by city residents who are eligible under the Residents Preference Program. Northwestern Mutual has consistently met or exceeded those goals. Before entering the building from Wisconsin Avenue, employees and the public are greeted by the Northwestern Mutual Gardens, a 4.6acre landscaped space filled with gardens and trees, tables, benches and walkways. One of the first things people will notice when they enter the building itself is the tremendous amount of light that shines through, Christophersen said. The Commons, which is a three-story, two34 / BizTimes Milwaukee AUGUST 21, 2017
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block long common area, will be open to the public. It includes a Starbucks coffee shop, as well as a visitor’s center and museum with interactive digital displays where people can learn about the company’s 160-year history. On July 23, Northwestern Mutual employees got their first look at the new office space and their reaction was remarkable, Christophersen said. Employees will begin moving into the building this week. There are no private offices located along the exterior walls, to allow the maximum amount of light into the building. And there are very few walls in general, Christophersen said. “I’ve been in the workforce a lot of years, and this is a place where when we are looking to hire people they will say, ‘I would love to work here,’” Christophersen said. “We have a beautiful open air café, public spaces, a fitness area and a very welcoming environment. It is like nothing I have ever seen before, certainly in this state.” In addition to building its new office tower, Northwestern Mutual is also in the process of constructing a 34-story mixed-use residential tower at 777 N. Van Buren St., adjacent to its downtown campus. The building also has a significant amount of structured parking for the company’s employees. Northwestern Mutual originally wanted to purchase O’Donnell Park for its parking needs, but the Milwaukee County Board voted against the sale in 2015. The new residential tower, to be named 7Seventy7, features 25 stories of one-, two- and three-bedroom luxury apartments on top of an eight-story parking garage, which will help address the company’s workforce parking needs when it opens in summer 2018. But Christophersen said the timing of the residential tower in conjunction with the company’s new downtown headquarters was coincidental. The development is more of an investment opportunity for Northwestern Mutual Real Estate, the company’s real estate arm. It’s one of the largest real estate investors in the country, with investments in commercial mortgages and equity investments across all major property types, including apartments, office, retail and industrial, he said. “That (building) could have been built in Milwaukee, San Francisco, New York or anywhere,” Christophersen said. “The timing was just right and ironically, it is so close to our other project it has been tied into what we are doing. But it is totally unrelated.” n 36 / BizTimes Milwaukee AUGUST 21, 2017
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These photos show the interior office space and fitness area of the new Northwestern Mutual Tower.
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OJB Landscape Architecture designed the gardens at the Northwestern Mutual Tower & Commons.
Symphony of designers, architects collaborated on Northwestern Mutual By MaryBeth Matzek, for BizTimes DESIGNING NORTHWESTERN MUTUAL Life Insurance Co.’s new $450 million, 32-story office tower was truly a team effort. As the architect of record for the Northwestern Mutual Tower and Commons project, Kendall/Heaton Associates Inc. was tasked with keeping the 37 design businesses working on the project moving forward. “We had a large team of consultants and it was challenging at times, but everyone pulled together and did their part to create this magnificent building,” said Pat Ankney, a principal with Houston-based Kendall-Heaton. New Haven, Connecticut-based Pickard Chilton was the building’s design architect, 38 / BizTimes Milwaukee AUGUST 21, 2017
while Chicago-based Valerio Dewalt Train Associates served as interior architect. Project developer Hines brought Kendall-Heaton on board to spearhead the design and architect coordination. Communication was key in bringing the project to fruition, Ankney said. “We would have meetings every two weeks with members of the design team and work on the plan and keep it moving forward,” he said. “We are proud of how it turned out.” Jon Pickard, a principal at Pickard Chilton, said his company worked with Northwestern Mutual and others involved in the project to develop a design that met the Milwaukee company’s needs. “I viewed our role as a symphony conductor, bringing everyone together in a collaborative partnership,” he said. “We wanted to do our best to utilize the campus space and the great view of the lake while developing a look that fit with the city’s skyline. We wanted the architecture to reflect the elegance, quality and authenticity that Northwestern Mutual represents.” Incorporating local businesses into the de-
sign work was vital, Ankney said. More than two dozen Milwaukee- and Wisconsin-based businesses were used in the project to meet the city’s requirement (part of the tax incremental financing subsidy) that Northwestern Mutual use small business enterprises for 25 percent of the project’s costs. Rinka Chung Architecture Inc. was one of those locally-owned businesses, providing its design skills in the commons area, including the Northwestern Mutual Credit Union. The firm used its financial institution design expertise to create what principal Matt Rinka said is an example of leading edge design for credit unions and banks. As part of the design, bankers work from teller pods that open to the lobby, allowing for easy interaction with members. There is also a technology kiosk that displays current promotions, with demonstration areas for online member resources. “The location within the commons area, with its full glass walls and connection to the tower lobby, provides a spectacular space for both members and bankers,” Rinka said.
Chad Griswold, principal at Rinka Chung, said interacting with world-class design firms, including Valerio Dewalt, was an amazing experience. “We have always placed high importance on doing great design work in our hometown, so we’re proud to have been involved in this landmark project for the city,” he said. “The scale and significance of the project is unprecedented.” When architect Pickard steps back and looks at the project as a whole, the design of the commons area stands out. “It’s three stories tall and really brings the staff of Northwestern Mutual and the community together,” he said. “There are places to eat and meet, or people can walk out to the garden. It is a feeling that you may find on a university campus.” The project’s innovative design and architecture doesn’t end when leaving the building. Outside, OJB Landscape Architecture worked on the Northwestern Mutual Gardens, which covers three acres and provides both employees and community members with plenty of green space, flowers and walkways to enjoy. Jim Burnett, president of OJB, said a vital part of the project was making the incline from the street level to the building “not too overwhelming.” Nathan Elliott, a principal at OJB, said the team worked hard to link the exterior spaces to the tower’s interior. That included the atrium, which connects the historic office building to the new building. “It is an interior space for events that is simple and elegant, with a water feature and palms,” he said. Elliott said landscapers worked with construction crews to preserve as many large trees on site as possible. “We had to carefully choose what (plants) to include since you want it to look nice 12 months of the year, not just in summer,” he said. “We were lucky that the southern side of the building has great sun exposure.” Northwestern Mutual was also “interested in the story behind the story,” Burnett said. That meant they wanted a garden that did not use a lot of water or fertilizer. “The garden can also be a guide to help visitors figure out what to plant during the different seasons,” he said. Pickard said the project’s main players – Kendall-Heaton, Valerio Dewalt and his own firm – have worked together on other buildings, which helped in making the Northwestern Mutual building a success. “There is a level of trust between us that helped us share more openly our ideas as we moved forward,” he said. n
Architectural renderings for the Northwestern Mutual Tower & Commons. New Haven, Connecticut-based Pickard Chilton was the design architect for the project. biztimes.com / 39
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Experience gained on Northwestern Mutual tower builds construction careers By Lauren Sieben, for BizTimes WHEN THE MILWAUKEE Common Council approved $54 million in tax incremental financing for the Northwestern Mutual Life Insurance Co. office tower project in 2013, the announcement didn’t just mean big changes to the Milwaukee skyline. For local construction workers, along with unemployed and underemployed city residents, the project ushered in an opportunity for steady work–and, in some cases, a path to a new career. The Northwestern Mutual tower was Andrew LaVigne’s first union construction job. LaVigne, 36, had been working as a landscaper for eight years when he and his wife began talking about starting a family. He was drawn to the trades by the stability afforded by union 40 / BizTimes Milwaukee AUGUST 21, 2017
insurance and a pension. LaVigne got his start working on the Northwestern Mutual Tower and Commons project as an employee of Milwaukee-based JCP Construction in 2016. He spent the year building metal and steel framing for fire-rated walls throughout the building. The Northwestern Mutual tower’s tax incremental financing came with a few hiring stipulations from the city. The company was required to employ a minimum number of local small business enterprises and unemployed or underemployed residents from Milwaukee’s poorest neighborhoods. Northwestern Mutual has thus far met those goals, and then some. According to the latest Northwestern Mutual Tower and Commons SBE and RPP participation report, which includes data through the end of 2016, SBEs in Milwaukee have been awarded $121.5 million in contracts or commitments—that’s 32.1 percent of the total amount spent on applicable construction and professional services. Milwaukee residents eligible under the Residents Preference Program, which requires contractors to hire a certain number of unem-
ployed or underemployed city residents, had performed 45.1 percent of the construction hours on the project through the end of 2016. Those numbers exceed the TIF requirements, which obligated Northwestern Mutual to award at least 25 percent of applicable contracts to Milwaukee SBEs and 40 percent of labor hours to RPP-eligible Milwaukeeans. Ken Kraemer, executive director of Building Advantage, the Construction Labor Management Council of Southeast Wisconsin, credits the project with propelling forward not just development in the city, but also the careers of Milwaukee tradespeople. “It’s all about careers,” Kraemer said. “We want to change people’s lives and give them the opportunity to get this training and see that when they finish the apprenticeship training, nothing can hold them back. The sky’s the limit.” Apprentices in trades across the construction industry earn while they learn, working alongside experienced journeymen on jobsites while completing educational requirements outside the work day. LaVigne is now in his second year as a carpenter apprentice. Once he fulfills his apprenticeship require-
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ments – which include four years of on-the-job experience – he’ll be eligible to become a journeyman carpenter. “I worked with three journeymen (at Northwestern Mutual) and those three guys that trained me were some of the best that I worked with so far in my career,” LaVigne said. “A lot of apprentices don’t get to work with a guy who takes the time to actually teach them. That’ll be a lasting impression from the job.” Brandi Archambeau-Fisher also considers herself fortunate that the Northwestern Mutual tower was her first job site as an aspiring electrical apprentice. After working for We Energies in the collections department, Archambeau-Fisher, 30, decided she’d rather be working in the field than in the office. She started working on the Northwestern Mutual tower in 2016 as a material handler delivering parts to electricians, then moved up to wiring fire alarms and setting up Internet and phone lines. The day-to-day work on the tower was grueling at times, particularly in the dead of Wisconsin winter. “It’s real cold when you’re up on the 20th floor,” LaVigne said. But braving the elements was worth it, and LaVigne says he feels a sense of pride when he drives by Milwaukee’s second-tallest tower today with his wife and 16-month-old son. Many of the Milwaukeeans who worked on the Northwestern Mutual jobsite have found sustained work in the construction industry. Both LaVigne and Archambeau-Fisher are at work now on the new Milwaukee Bucks arena. LaVigne works for Wall-tech Inc. and continues to frame and build fire-rated walls. Archambeau-Fisher works in material handling for Staff Electric Co. Inc. and on the distribution crew in the arena’s switchgear room. She is also studying for the entrance exam to become an electrical apprentice. As a single mother, Archambeau-Fisher says she values her new career path. The financial stability the career offers is important, she says, but so is the opportunity to be a role model to her two young children. “I’d drive past the building and say, ‘That’s where mom works,’ and my 9-year-old would talk about it at school with her friends,” Archambeau-Fisher said. “She’d be all proud, and she’d tell her teachers. When I went to parent-teacher conferences, they were all talking to me about it, saying, ‘That’s so cool.’” n 42 / BizTimes Milwaukee AUGUST 21, 2017
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The Northwestern Mutual Tower and Commons project created 2,600 construction-related jobs.
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Many had a part in tower construction effort By Maredithe Meyer, staff writer
JON ELLIOTT OF MKE DRONES LLC
Milwaukee’s largest construction project in 44 years is complete. Standing at 550 feet and 32 stories tall, occupying the length of two city blocks, the Northwestern Mutual Tower & Commons collectively holds 1.1 million square feet of space – the state’s largest volume of office space in one structure. Milwaukee-based Northwestern Mutual Life Insurance Co. invested a total of $450 million in the project and created 2,600 construction-related jobs – many falling into the hands of Milwaukee residents. “The company embraced the idea of growing the Milwaukee community through growing its workforce,” Department of City Development Commissioner Rocky Marcoux said. “The Tower & Commons is a showplace not only for Northwestern Mutual as a company, but it is a showplace because it is an architectural jewel and it was built by men and women from our city.”
Building a team Hines, a Houston-based global real estate investment and development firm, was the project’s development manager from beginning to end – from analyzing the site and determining the structure’s size, to hiring and managing the design and construction teams, to eventually, handing over the keys to Northwestern Mutual. “This is a signature project and something that the city should be proud of for a long, long time,” said Brad Soderwall, a managing director at Hines. “It’s humbling to be part of such a significant effort.” When it was time to build, Northwestern Mutual hired Providence, Rhode Island-based Gilbane Building Co. and Milwaukee-based C.G. Schmidt Inc. to lead construction as the general contracting team, managing more than 100 direct subcontractors throughout the process. Adam Jelen, a senior vice president at Gilbane, said development partnerships for large construction projects are often dependent on the firm’s culture but at Gilbane, partnerships are highly valued. Prism Technical Inc., a Milwaukee-based consulting firm, was responsible for connect44 / BizTimes Milwaukee AUGUST 21, 2017
It took about three years to complete the $450 million construction project for the 32-story Northwestern Mutual Tower & Commons.
ing the project’s team with small business enterprises and Residents Preference Program workers interested in construction opportunities. Northwestern Mutual was required to hire those firms as a condition of the $54 million in tax incremental financing provided by the city. “I look at the Tower and Commons project as a tipping point as it relates to inclusion on projects,” said Lafayette Crump, chief operating officer at Prism. “It really showed what could happen when you have a committed team and you treat diversity and inclusion as just as significant a part of the project as anything else.”
Out with the old Northwestern Mutual’s need for a new downtown office structure arose when maintenance costs of the former East Building grew too high. The company announced the structure would be demolished and soon after, plans were made for a new building in its place – the
Tower & Commons. Prior to demolition, the East Building, which housed a cooling plant that air conditioned the historic South Building, was decoupled from the neighboring structure and a temporary cooling plant and emergency generator were installed on the South Building’s east side. Rogers, Minnesota-based specialty contracting and waste management firm Veit & Co. Inc. lad the demolition of the 16-story East Building, deconstructing it floor-by-floor, starting from the top – a method that was chosen instead of implosion, which could have caused flying debris and dust clouds, or possible harm to surrounding buildings. More than 90 percent of the materials deconstructed from the East Building were reused and recycled.
In with the new After the yearlong demolition process, the
crews wrapped around the building, four floors at a time, working from east to west. Covering the exterior allowed workers to construct interior walls and floors and install air circulation systems. By December 2016, the curtain wall was complete and a sign reading “Northwestern Mutual” was installed at the top of the building. Construction crews then focused heavily on interior projects and began landscaping the surrounding areas, including the Northwestern Mutual Gardens, a 4.6-acre green space that is open to the public. As the summer comes to a close, Northwestern Mutual employees are beginning to move into the new building. “Right now, the project has reached its substantial and final completion and we are just wrapping up some odds and ends,” Jelen said. “But we will continue our partnership with Northwestern Mutual and will continue the longstanding relationships with our trade partners here in the metro area. It’s not about building a one-time project, it’s about longstanding relationships.” n
JON ELLIOTT OF MKE DRONES LLC
construction team broke ground in August 2014 and prepared the site for Wisconsin’s largest-ever concrete pour – 10,000 cubic yards over a 27-hour period – that created a concrete mat foundation. At the building’s completion, 35 levels of concrete hold its core. By mid-2015, crews began to erect the steel frame for both the Tower and the Commons and cranes were installed to reach the tower’s growth. The construction site buzzed with almost 500 workers daily. Meanwhile, Portland, Oregon-based Benson Industries Inc. leased an 83,000-squarefoot space in the Century City Business Park on Milwaukee’s northwest side to serve as a manufacturing site for 70 Residents Preference Program workers hired to make the tower’s exterior glass curtain walls. “This project took that work and it put it right in the neighborhood where those RPP workers live,” Marcoux said. “It is a very tangible way of saying that the city is everybody and it has an opportunity for everybody.” About 100,000 hours of work produced the 386,000 square feet of glass construction
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Need a friend? Get a dog “If you want a friend, get a dog. But if you want advice, get a board of directors.”
a dog. But if you want advice, get a board of directors.” As a TEC/Vistage chair, people often ask me if a TEC group is the same experience or if it can substitute for a board. My tongue-in-cheek answer to this is, “Oh no, they are the complete opposite. In a TEC/Vistage group (in effect, a peer group), you need to be open, honest and vulnerable. God help you if you are ever vulnerable in front of your board!” Yet I do believe peer groups and boards are equally valuable; But they serve very different purposes.
TEC GROUPS/PEER GROUPS:
About 20 years ago, I was in the midst of a business crisis. It tended to be a monthly occurrence. But this time, the situation was truly dire. I visited with Mike Dunham, founder of Effective Management Systems, a developer of ERP and CRM systems, today known as WorkWise/OnContact. I described my problem to Mike. He asked some great questions and helped me gain insight into what to do. Near the end of lunch, I asked, “How much do you tell your wife about problems at work?” “Nothing,” he said. “Really?” “In the beginning,” he said, “I used to tell her everything. But I realized what I was sharing was mostly problems and bad news. And without her being deeply involved in the business, she could never have the context of the real issue, and it just served to stress us both out and make her worry.” “So – then who do you talk to about problems at work?” I asked. “Well,” Mike said, “if you want a friend, get 46 / BizTimes Milwaukee AUGUST 21, 2017
Although I am a TEC/Vistage chair and I really believe in our unique process, there are other good options for peer groups. YPO (Young Presidents’ Organization) has forums. Most chambers of commerce have roundtable programs. And there are plenty of role-specific peer groups such as our Allied CFO or HR Roundtable programs. If you are the CEO, members of your team need a peer group, too. To be a successful member and to receive and give peer group value, you need three things: 1. Most importantly, a commitment to confidentiality. 2. The understanding that you are not the smartest person in the room. In other words, the willingness to listen. 3. The desire to know members of your peer group at a deeper level, not just on meeting days.
ADVISORY BOARDS I asked a local expert, Rand McNally, for his best advice on forming boards for private companies. He offered these thoughts: 1. Select your board members carefully. Don’t necessarily choose friends. Find people who are willing to give you unfiltered
advice and counsel. Create a skills matrix to fill in gaps that may exist in your organization. And remember, board members are like aged beef – you get what you pay for. 2. Advisory boards are appropriate for private companies. But hold the board to a fiduciary standard, including being fully prepared for board meetings. Board members should be willing to put in extra time and effort as needed for committees, crisis situations or if the leader becomes incapacitated. 3. Businesses with independent and experienced board members grow faster and are more profitable. These types of well-composed boards help minimize risk. We all know it’s lonely at the top (note: It’s even lonelier at the bottom). No CEO can do it alone and shouldn’t try. So, my advice: JOIN a peer group, FORM a board, and GET a dog. We all need friends, too! n
JOHN HOWMAN John Howman has led a variety of businesses, from technology to consumer products companies, and leads two groups for TEC/Vistage, a professional development group for CEOs, presidents and business owners. He can be reached at JHowman@ AlliedCG.com.
Positive negotiations with customers How to make deals that solve problems and maintain good relationships As a business owner or manager, your daily activities include negotiations with customers to solve problems and secure orders while maintaining a mutually beneficial relationship. Here are some approaches that I have found successful in maintaining positive relationships with your customers while dealing with these challenges. Your first step is to acknowledge there is a problem. Denying or ignoring that fact only makes it worse and usually, the solution selected will be more expensive and possibly damage the relationship between the parties. The next step is to ask the customer to clearly define the problem and identify potential solutions. Don’t offer a solution until you totally understand the details of the problem. The best solution may not be the first one that comes to your mind or theirs. Once you have clearly defined the problem and developed your proposed solutions, evaluate the customer’s suggested solutions and compare them to the solutions you have developed. Whatever solution you select, it should be a “win-win.” In some cases, you may have to give up something in the short-term to get the order or retain the customer. If the problem was caused by the customer, link your solution to a change in their business behavior. Linking is tying a change in behavior
or a concession the customer makes to a concession you offer. You should never make a concession unless the customer also gives up something of value. This is the basis of a collaborative approach to problem solving. Many times, when you are negotiating a deal, the buyer may state, “The price is too high,” or “I need the delivery by a certain date.” When you hear the price is “too high” you have options available to you. You can reduce your price by a set percentage, ask what part of the price is too high or suggest the customer moves to the next price break. The option that has the best possibility of resolving the price problem is determining exactly what component of the price is too high. It may be the freight, the size of the discount or the unit cost. All it may take is a small adjustment to the quantity or the unit cost to seal the deal. In many cases, when you offer a percentage off, e.g. 10 percent, you may give away too much of your margin and set a precedent for future negotiations. The request of “delivery by a certain date” is another opportunity to negotiate out of a potential problem. In many cases, I have run into this problem and found that asking, “Do you need the entire quantity on that date?” revealed the answer was no. That provides the opportunity to ask a follow-up question. “How much do you need by that delivery date?” You may find out you can fulfill the entire order over time, avoid additional costs and keep the customer satisfied. Should the parties to any of these business negotiation scenarios reach an impasse, a point when the negotiation has come to a dead end, there are options. Many purchase orders and contracts contain a clause that permits the parties, if they reach an impasse, to introduce a third party into the negotiation. Some contracts stipulate Alternative Dispute Resolution, which involves mediation and, in some cases, arbitration if the parties cannot reach an agreement
within a reasonable time. Mediation usually results in a “win-win” agreement, while arbitration awards tend to be a “zero sum” result. Such a result would make one party whole at the expense of the other party. This result would not aid you in maintaining a positive long-term relationship with the customer. These costly and time-consuming options can be avoided by applying the approaches summarized above. These types of situations offer you the opportunity to identify options with your customer by maintaining an ongoing dialogue. This dialogue will strengthen the relationship between the parties and create a “win-win” situation. Your vendors and customers will become your business partners and enjoy a positive relationship because together, you are solving problems in a manner in which both parties benefit. n
CARY SILVERSTEIN Cary Silverstein, MBA, is a writer, speaker and community volunteer who splits his time between Scottsdale, Arizona and Fox Point. He is the co-author of the book “Overcoming Your NegotiaPhobia,” and can be reached at (414) 403-2942. biztimes.com / 47
Tip Sheet Keys for talent planning By Joe Galvin, chief research officer at Vistage Research
study from Vistage Research and the National Center for the Middle Market reveals that talent planning plays a critical role in the growth and performance of companies in the middle market. The Vistage-NCMM study, conducted in October 2016, surveyed more than 400 C-level
executives from middle-market companies who are actively engaged in attracting and retaining talent for their organizations. Key takeaways from the survey: 1. Talent planning is a powerful business driver. The fastest-growing, best-performing middle-market companies place more importance on talent planning than their slower growing peers. 2. The size and structure of an organization has a significant impact on how talent planning is conducted. As firms grow, they tend to put greater emphasis on talent planning and to adopt more formal talent planning processes. 3. There is room for improvement in the talent planning process. Many middle-market leaders gave their companies less-than-optimal ratings on their current talent planning programs. The most common weaknesses reported were succession planning, identifying skills gaps and having processes in
place for identifying/developing high-potential employees. 4. The single most important thing companies lack is a systematic framework for talent planning. The study found a clear correlation between process formalization and how well companies perform at talent planning. The survey also found that the fastest-growing, best-performing middle-market firms are more likely to have a defined process and to coordinate multiple talent planning activities. 5. Successful talent planning involves four core elements. • Aligning talent strategy with corporate strategy • Building sufficient processes to ensure systematic talent planning efforts • Involving leadership in the process, as opposed to handing off to human resources • Engaging employees in talent planning and ensuring they recognize the value of the process n
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BizConnections PAY IT FORWARD
Serving with vision F.R. Dengel III Managing director Emory & Co.
LILA ARYAN PHOTOGRAPHY
Nonprofit served: Prevent Blindness Wisconsin Service: board member, 12 years
50 / BizTimes Milwaukee AUGUST 21, 2017
SOMETIMES SERVING involves taking care of the little things, filling in wherever the gaps may be. Sometimes it’s as simple as retrieving the mail when there’s no one else to do it. F.R. Dengel III has served on the board of Prevent Blindness Wisconsin, a Milwaukee nonprofit that provides free vision screening services, for 12 years. During that time, the organization has undergone a few executive director changes, which has left some gaps in its day-to-day operations. Dengel, managing director at Milwaukee-based investment banking firm Emory & Co., is credited with filling them. “Through our various leadership transitions, F.R. has always been the one to help us keep the work moving forward,” said Tami Radwill, executive director of Prevent Blindness Wisconsin. “He hired an accounting firm to pay our bills after our controller left, he came to the office and opened the mail for us when our CEO left; he helped me write grants during that time. He reads all of our contracts, our 990s, you name it, and always offers good changes and suggestions.” Dengel’s involvement with Prevent Blindness Wisconsin was inspired by his parents. His father, F.R. Dengel II, served on the board in the 1970s, while his mother, Mary Dengel, worked as its office manager for 17 years around the same time. Today, the organization has 12 staff members and relies on thousands of volunteers who conduct free vision screening programs in schools – an important service many schools couldn’t otherwise
afford to offer, Dengel said. Prevent Blindness serves children in every county in Wisconsin, but most live in Milwaukee. In the 2016-’17 school year, 219,745 children were screened and 22,431 were referred for complete eye examinations. Among them, 372 reported diagnoses of Amblyopia, which can lead to blindness in one eye if not treated early. While Dengel’s involvement on the board often involves attending meetings and reviewing financial information, it was in reading the organization’s mail that he was reminded of its wider impact. “When I was opening the mail, every so often you would get a letter from someone who says, ‘Thank you so much – my son or daughter was screened and the screeners found something and I never knew it’ … The stories that you get in the mail are really heartwarming, the grateful people you hear from.” Dengel said he was touched to see an occasional donation of $5 or less come through the mail. “They would say ‘Please use this to do good,’” Dengel said. “And I think one of the things I feel good about is that Prevent Blindness does do good with those donations from people who can only give $5. It’s well-spent to help people.” n
LAUREN ANDERSON Reporter
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PERSONNEL FILE ACCOUNTING
BUILDING & CONSTRUCTION
Vrakas CPAs + Advisors, Brookfield
MSI General Corp., Oconomowoc
Vrakas CPAs + Advisors has promoted Scott Syrjala and James Broughton to tax principal and Holly Breien to audit principal.
MSI General Corp. has added Adam Reek to its team as a project executive associate within the select projects department. Reek is responsible for managing the smooth operation of building construction projects, from design through occupancy.
Groth Design Group, Milwaukee
Kahler Slater, Milwaukee,
Kahler Slater has promoted Mike Franz, Skip Holschbach, Mary LaFrombois and Amber MacCracken to associate principals in the firm.
BANKING & FINANCE
First Bank Financial Centre, Oconomowoc First Bank Financial Centre promoted Joe Broadfoot to business development officer, SBA specialist. He will continue to focus on his customers and provide SBA lending to prospective business owners.
Infinity Benefit Solutions, Milwaukee Chris Ament has joined Infinity Benefit Solutions as an employee benefits consultant.
working in restaurants and private clubs throughout the world.
Groth Design Group has hired James Davenport as a project designer and David Boyd as a senior project manager.
Robertson Ryan & Associates, Milwaukee Robertson Ryan & Associates has named Christopher Illman chief executive officer. He has a proven record of translating vision and strategy into world-class execution, bringing together teams and systems to drive results.
Meissner Tierney Fisher & Nichols S.C., Milwaukee
Judy Gavigan, formerly of Wheaton Franciscan Healthcare | Ascension, will be taking on a new role as director of sales and marketing at Healics. She will oversee growth within the sales force, establish and utilize connections, as well as market the products and services Healics offers.
Graham Garland has joined Meissner Tierney Fisher & Nichols as an associate attorney.
Vision Forward, Milwaukee Leona KnoblochNelson joins Vision Forward as the director of development and sustainability. Her work at Vision Forward will focus on stewarding relationships with supporters and community partners, allowing Vision Forward to continue carrying out its mission of empowering individuals of all ages with vision loss through all of lifeâ€™s transitions.
Milwaukee Urban League Young Professionals, Milwaukee
Mueller Communications, Milwaukee
The University Club, Milwaukee The University Club has named David Magnasco culinary director. In his new role, Magnasco will oversee all culinary operations at both the city and country clubs. Magnasco joins the University Club with more than 27 years of professional culinary experience
Mueller Communications has hired Mayra Alaniz, James Price and Soorina Beecher as associates.
The Milwaukee Urban League Young Professionals has named Sean Lowe central region vice president; Michelle Helm parliamentarian; Fiesha Lynn Bell secretary; Jordan Roman president; Jackie Oraedu treasurer; and Tiffany Henry vice president.
Submit new hire and promotion announcements to: www.biztimes.com/personnel
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BizConnections VOLUME 23, NUMBER 11 | AUGUST 21, 2017
GLANCE AT YESTERYEAR
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— This photo is from the Milwaukee Public Museum’s Photo Archives collection.
Taxpayers will pay steep price for Foxconn THE $3 BILLION INCENTIVE offered by Gov. Scott Walker to convince Taiwan-based Foxconn Technology Group to build a massive plant in southeastern Wisconsin is an enormous commitment from taxpayers. We recently found out just how significant that obligation is going to be. According to a Legislative Fiscal Bureau report, Wisconsin taxpayers won’t get a return on their investment in Foxconn for 25 years, or until 2042, from the state taxes paid by Foxconn employees, employees in the company’s supply chain and employees of induced jobs created by the economic impact of the Foxconn plant. When I heard that news, I immediately asked myself how old I will be in 2042. Answer: 67. Wow. Walker says the Foxconn deal is a “once-ina-lifetime” economic opportunity for the state. It is going to take a huge portion of our lifetime 52 / BizTimes Milwaukee AUGUST 21, 2017
to pay for it. The question then is…will it be worth it? Walker says “absolutely.” He points to Foxconn’s commitment to spend $10 billion to build a 20 million-square-foot plant and $10 billion in salaries that will be paid by Foxconn ($700 million a year starting in 2021, according to the Fiscal Bureau) over the 15 years the state subsidy will be paid to the company. In the governor’s “pay as you grow” plan for Foxconn, the company only gets the tax incentive if it makes its capital investment and for hiring up to 13,000 employees. What makes this deal such a big fiscal challenge for the state is the fact that Walker and Republicans in the Legislature have already reduced state corporate income taxes for manufacturers to nearly zero. So the incentive that will be paid to Foxconn is not a tax break; it’s cash payments the state must come up with. But the Foxconn deal is “bigger than future tax revenues,” Walker said. It’s an opportunity to transform the state’s economy into a hightech electronics manufacturing hub, he says. For the state, there is significant risk in this deal. Who knows what will happen to Foxconn’s business in 25 years? “Technological advances and changes
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This photo, taken circa 1925, shows some kind of festival at the lower end of East Wisconsin Avenue from Lincoln Memorial Drive, looking west. The U.S. Courthouse and Federal Building, as well as the now-former Northwestern Mutual Life Insurance Co. headquarters, can be seen in the background. The gathering is near the present day Henry Maier Festival Park.
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in Foxconn’s market share, operating procedures or product mix could significantly affect employment and wages at the proposed facility over time,” the Fiscal Bureau report states. But the Fiscal Bureau acknowledges its analysis focuses only on the impact of Foxconn on the state treasury and “does not account for other benefits to the state’s economy and residents.” The state tax credit for the company’s capital expenditures, and the sales tax exemption included in the deal, have a value of $1.5 billion to induce the company’s $10 billion investment. That results in a “leverage ratio” of $6.70 of private investment for each $1 of public outlay. The payroll credit results in a 5.9 to 1 leverage ratio just for Foxconn’s payroll, and is even higher if you include the indirect and induced jobs created. “Most state expenditures do not result in private investments of this nature,” the report says. n
ANDREW WEILAND EDITOR
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AROUND TOWN 2017 Family & Closely Held Business Summit
BizTimes Media’s annual event featured keynote speaker Tom Deans, author of “Willing Wisdom: 7 Questions Successful Families Ask,” and attendees participated in roundtable discussions on wealth transitioning and preservation, family business culture, leadership development and more.
HEATHER KRUGLER of Kowal Investment Group LLC and NANCY JO DIETZEN of the Wisconsin Family Business Forum.
LAUREN ANDERSON of BizTimes Media with NANCY MEHLBERG, BONNIE BAILEY and BARB ECKLOND, all of SVA Certified Public Accountants.
SUSAN BALL of Schenck SC and ANDREW STROMWALL of Wells Fargo Advisors LLC.
AL MCILWRAITH of Johnson Bank, keynote speaker and author TOM DEANS , and GINA NATOLI of Beauchamp Maleki Group.
AARON SPITZNER of Kowal Investment Group and ANDREI JUNGE of Prudential.
BILL WEST of von Briesen & Roper s.c. and JACK RIESCH of R&R Insurance.
MARY MCGRATH and TOM DILLETT, both of Dillett Mechanical Services, and TOM BEINE of Sikich LLP.
ALEXANDRA GOLDMAN and TONY REVOLINSKI , both of Sattell, Johnson, Appel & Co. S.C. Photos by Paul Gaertner
Zoological Society of Milwaukee’s Zoo Ball
The annual event’s theme was Black Tie & Tails and included dueling pianos, gourmet dining, live music, dancing and both silent and voice auctions that featured four tickets to Donald Driver’s induction into the Green Bay Packers Hall of Fame. 9.
Presenting sponsors and Zoo Ball chairs DR. WILLIAM STATHAS and JUDY HOLZ STATHAS .
10. Zoological Society president and chief executive officer JODI GIBSON and Milwaukee County Zoo director CHUCK WIKENHAUSER .
11. Society board member GINA PETER of Wells Fargo, GIBSON and Society board chairwoman CAROLINE KRIDER of U.S. Bank. 12. Husch Blackwell employees. 13. Society board treasurer NANCY CARTER and MIKE CARTER of Northwestern Mutual Life Insurance Co.
14. SARAH GROOMS of Wintrust Financial and SAM GROOMS . Photos by Rich Taylor and Stacy Kaat biztimes.com / 53
BizConnections MY BEST ADVICE
Character is like a tree and reputation like a shadow ” LILA ARYAN PHOTOGRAPHY
TAMI SCULLY GARRISON Community affairs manager MillerCoors LLC Milwaukee Industry: Brewing millercoors.com Employees: 1,300 in Milwaukee; 7,900 total
54 / BizTimes Milwaukee AUGUST 21, 2017
“OUR CHIEF PUBLIC AFFAIRS and communications officer (five years ago, Nehl Horton) was talking to us about our company and our corporate reputation and he used a quote that has stuck with me. It’s an Abraham Lincoln quote: “‘Character is like a tree and reputation like a shadow. The shadow is what we think of it; the tree is the real thing.’ “What’s our culture like, but more importantly, what’s our character? It helped guide me in terms of my work in what I was doing and how we were doing. And then I realized I could take that and apply it to my personal life, which is where I think it’s probably helped me the most. For me, I thought about, ‘Who am I? What am I rooted in through my personal beliefs?’ and try to use that as my guiding principles day-to-day, versus ‘What are other people going to think of my choice?’ “The only way you can really control that shadow is by controlling that tree, making sure that it’s got really strong roots.”
AGE: 43 PROFESSIONAL EXPERIENCE: Garrison holds a bachelor’s in business administration and management from Tulane University and completed the Future Milwaukee Leadership Program at Marquette University. She worked at Hyatt Hotels Corp. for 11 years, advancing to director of catering and convention services for Hyatt Regency Milwaukee, before joining Miller Brewing Co. as guest services manager in 2005. Garrison also served as employee social investment manager at Miller Brewing until the company was absorbed into the MillerCoors joint venture in 2008. Since then, she has led MillerCoors’ community affairs, which entails guiding its philanthropic strategy and
community investments and partnerships. IN THE NEWS: In May, Garrison was appointed board chair of TEMPO Milwaukee, a women’s leadership organization in which she has been involved since 2010. She will serve a two-year term. Garrison also sits on the boards of the American Red Cross in Southeastern Wisconsin and the Zoological Society of Milwaukee. n
SHAPING THE FUTURE Manufacturing Matters! 2017 will take place at the Hyatt Regency in Milwaukee on February 23rd, 2017. The theme of this year’s conference is Shaping the Future, and the conference features 18 breakout session in six tracks including: Growth • Operational Excellence • Human Capital Management C-Suite Essentials • Technology & innovation Wisconsin Manufacturing P L AT I N U M S P O N S O R P L A T I N U MAsSworkforce P O N S O R challenges and trends are
on the minds of most manufacturers, we are pleased to announce this year’s presenter is Kip Wright, Senior Wednesday, keynote October 4, 2017 • 7:00 - 11:00 AM Vice President of Manpower, North Manufacturing & Technology Show Wisconsin Exposition Center at State Fair Park America.at Kip will discuss G O key L D workforce SPONSORS trends and what manufacturers can do Kip Wright to secure and develop their current and Senior Vice President of future workforces. Manpower, North America Are you letting the disruptors control you, or are you building a “Proactively Adaptable Organization”
Preparing For What’s Next
Join us for the annual Next Generation Manufacturing Summit, featuring a lively interactive discussion with chief executive ofwww.manufacturingmatters.org ficers and leaders of southeastern Wisconsin manufacturing companies. These CEOs will share their company’s ideas and best practices for competing in a global marketplace and how they strive to be “proactively adaptable” world-class manufacturers in the 21st century.
SHAPING THE FUTURE
Proactively adaptable organizations look beyond their own four walls and next purchase order and are preparing for the inevitable disruptors in today’s business environment. Hear from industry leaders who are creating processes and a culture of innovation, as well as methods of talent attraction, that will drive innovation in their business.
Manufacturing 2017 take place at the Hyatt The programMatters! continues withwill roundtable discussions. TheRegency CEO panel and roundtables will address a variety of topics including: in Milwaukee on February 23rd, 2017. The theme of this year’s • Building an organization’s “adaptability muscles” for the future • Succession planning conference is Shaping thedevelopment Future, andand theretention conference features 18 • Talent attraction, • Exporting, global engagement breakout session in&six tracks including: • Additive manufacturing/3D printing • Leadership engagement data, Internet of Things, •Artificial Growth••Big Operational Excellence HumanIntelligence Capital • Creating a process and culture to be more innovative Management C-Suite Essentials • Technology & innovation • Automation and process improvement Wisconsin Manufacturing • Logistics & supply chain management
As workforce challenges and trends are on the minds of most manufacturers, we are pleased to announce this year’s keynote presenter is Kip Wright, Senior Vice President of Manpower, North GOLD SPONSORS America. Kip will discuss key workforce trends and what manufacturers can do to secure and develop their current and future workforces.
• Process improvement • Customer focused innovation • And More
REGISTER TODAY! • biztimes.com/mfg Kip Wright
FEATURED MAIN STAGE EVENT AT
Senior Vice President of Manpower, North America
REGISTER TODAY! www.manufacturingmatters.org
OCTOBER 3-5, 2017 SHOW REGISTRATION: WIMTS.COM
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The hype and hope of Wisconn Valley | Smarter buildings on the rise | Adding privacy to the open concept office | Northwestern Mutual Tower...
Published on Aug 18, 2017
The hype and hope of Wisconn Valley | Smarter buildings on the rise | Adding privacy to the open concept office | Northwestern Mutual Tower...