Leaders, connections and people with vision were behind Central Iowa’s top deals in 2014.

In the past year, Des Moines industry leaders, once again, demonstrated not just a “can-do” spirit, but a “can-do-it-together” ability. The 14 deals the Business Record staff picked as this year’s top deals illustrate that.

Want to know why Des Moines’ tired Botanical Center is on its way to becoming a 14-acre riverfront garden? 

It starts with philanthropist J.C. “Buz“ Brenton having lunch one day with his old friend Tom Urban, former Des Moines mayor and retired CEO of Pioneer Hi-Bred International Inc. (now DuPont Pioneer), at the Waveland Cafe. Brenton mentioned that he wasn’t getting much traction on a project to improve the Des Moines Botanical Center and asked Urban for his help. The two brought in Janis Ruan, a member of the Des Moines Founders Garden Club, and Fred Weitz, retired from running the The Weitz Co., and the four senior leaders in Des Moines became the team that drove an $11.6 million fundraising campaign to transform a 1970s geodesic dome into an anchor for more exciting outdoor gardens and dynamic horticulture programming.

Or consider DesMoinesArts Inc.’s project to convert the old Qwest building at 900 Keosauqua Way into inexpensive studio space for artists. That idea took shape  when Justin Mandelbaum of Mandelbaum Properties was talking with Zachary Mannheimer, executive director of the Des Moines Social Club. When Mandelbaum recalled converting a textile mill in Lowell, Mass., into an incubator for artists, Mannheimer told him that he needed to do that here. Fast-forward to Justin and his father, John, working on the project and getting financial support from the Community Foundation of Greater Des Moines and individual philanthropists such as Jim and Fred Hubbell, Jeff Fleming, director of the Des Moines Art Center, Bankers Trust Co. President and CEO Suku Radia and Polk County Supervisor Angela Connolly. 

Forward thinking on the part of MidAmerican Energy Co. officials is the reason that Iowans’ monthly power bills are so reasonable and that companies like Facebook Inc. and Microsoft Corp. chose Iowa for their data centers, which generate thousands of tax dollars annually for state and local governments. MidAmerican’s decision to invest in wind power, in the span a just a few years, has driven economic development in multiple ways.

So we tip our hats to the savvy business and community leaders behind these top deals in 2014.

- Anne Carothers-Kay, Business Record Managing Editor 


Top Cultural Deal

Des Moines Social Club opens

Deal details: On May 10, the Des Moines Social Club opened the doors to its new home.  The opening was a culmination of a $3.5 million campaign to convert the historic downtown fire station at 900 Mulberry St. into an arts, culture and social center that gives the Social Club room to stretch its legs. The space is nearly 25,000 square feet larger than any of the homes the Social Club had in the past. Inside, it houses a theater, an art gallery, a coffee and comic book shop, a restaurant and a bar, to name a few of the things it will offer.

Deal-makers: The Social Club’s move to the firehouse was led by the organization’s executive director, Zachary Mannheimer, and its board of directors. Assistant City Manager Matt Anderson and City Councilwoman Christine Hensley were the first to suggest that the Social Club consider the vacant downtown firehouse for its next home, Mannheimer said. Leaders at Principal Financial Group Inc., Wells Fargo & Co., Kum & Go LC and the Community Foundation of Greater Des Moines gave nearly $3.5 million to the project. 

The impact: Mannheimer predicted earlier this year that not only will the new Social Club provide a place for local emerging artists to grow, but that its economic impact will far outweigh what it cost to refurbish the fire station. “(The firehouse) would have made more money as a parking garage, but in the long term, the economic development we will bring to Des Moines is ridiculous,” he said. “With our budget and the number of people that will be coming through here, we will have an economic impact of $7 million 
in Central Iowa just through what we do.”


Top Downtown Development Deal

Kum & Go’s new headquarters

Deal details: Entities created by Kum & Go LC have spent nearly $12 million acquiring properties north of Grand Avenue in the Western Gateway, where it plans to build a 120,000-square-foot headquarters that will be designed by international architectural firm Renzo Piano Workshop. Land buys have included the Sherwin-Williams Paint retail store and warehouse, Jefferson Apartments, Scotty’s Body Shop and a Subway restaurant. 

Deal-makers: CEO Kyle Krause, who hopes to create an open, collaborative and inspiring workspace for the company’s growing workforce, which is currently based in West Des Moines. Brokers with CBRE|Hubbell Commercial also have been involved in many of the land acquisitions. Kum & Go has support from the city of Des Moines and the state of Iowa, which has granted $9.1 million in tax incentives for what the convenience store chain said will be a $92 million relocation, including construction costs and property purchases.

The impact: Kum & Go is expected to have 300 workers downtown, and there is little doubt that Krause wants to make a signature statement with the headquarters, which will be immediately west of  the Wellmark Inc. campus. In addition to the properties along Grand, Kum & Go is acquring more land, some of it to be used for a new convenience store and a training center. There is more: Krause and his wife, Sharon, also are rehabbing buildings along Locust Street south of the John and Mary Pappajohn Sculpture Park. 

Runner-up: Downtown Reinvestment District
The city of Des Moines received initial approval from the Iowa Economic Development Authority to create a special district downtown that could receive up to $36 million in tax rebates for a range of development projects, including a convention center hotel at the Iowa Events Center complex.


Top Economic Development Deal

Cultivation Corridor 

Deal details: The Capital Crossroads Capital Corridor committee moved forward with its efforts to brand Central Iowa as the premier agriculture and biosciences hub in the world by unveiling the Cultivation Corridor brand in April. Since then, Brent Willett, former president and CEO of the North Iowa Corridor Economic Development Corp., was hired as executive director and 22 people have been named to a board of directors  chaired by John May, president of agricultural solutions and chief information officer of Deere & Co. 

Deal-makers: Iowa State University President Steven Leath and Des Moines attorney Steve Zumbach, co-chairs of the Capital Corridor Committee, have led the efforts to get the Cultivation Corridor off the ground. 

The impact: The region’s new brand, the Cultivation Corridor, is meant to provide a recognizable name for Central Iowa in the same way that Silicon Valley does for the region centered on San Jose, Calif.  

Runner-up: New economic development center at ISU Research Park 
Iowa State University broke ground in September on a new Economic Development Core Facility that will be located south of the existing ISU Research Park. The new center, to open in mid-2016, will house about 100 employees plus conference space to serve as a one-stop shop for businesses seeking Iowa State’s expertise and assistance. 


Top Political Deal

Joni Ernst’s election to Congress

Deal details: When Republican Joni Ernst won election to the U.S. Senate, she became the first woman elected to represent Iowa in either chamber of Congress. In a colorful campaign, which included a TV commercial about castrating hogs that garnered national attention, she defeated U.S. Rep. Bruce Braley. It was also one of the most expensive campaigns in Iowa history. Braley was criticized for an ineffective strategy and subpar performance on the stump.

Deal-makers: Ernst’s team included such GOP heavyweights as David Oman, who was finance director. Jon Kohan served as manager of the campaign, which relied on the advice of strategist David Kochel and others. They fashioned a campaign that featured Ernst’s charisma and Washington outsider appeal, an effort that got a huge boost when the “make them squeal” ad referring to pig castration went viral.

Impact: With Ernst’s election, Iowa managed to dodge being the last state in the country to elect a woman to Congress. (Mississippi still hasn’t elected a woman.)

Runner-up: Branstad to become longest-serving governor in nationGov. Terry Branstad remained undefeated in his campaigns for public office, easily dispatching state Sen. Jack Hatch and setting himself up to become the longest-serving governor in U.S. history.


Top Startup Deal

Gravitate replaces StartupCity

Deal details: Entrepreneurial hub space Gravitate opened Sept. 1 in the Midland Building in downtown Des Moines. 

Deal-makers: Geoff Wood, founder of startup backer Welch Avenue, started Gravitate, in part, to fill a void left by the closure 
of StartupCity Des Moines. BrownWinick law firm and the University of Iowa Pappajohn Entrepreneurial Center were among the 
first to offer support.

The impact: Wood sees Gravitate as an entrepreneurial center of gravity. A collection of startups have work space on the third floor of  the century-old Midland Building, 206 Sixth Ave., which is under renovation. Wood said Gravitate focuses more on the benefits of people working in close proximity for different companies, and its synergy, rather than as a traditional incubator. As the year progressed, Gravitate opened additional workspaces. The main area is called the Google Bullpen, a large room with standing desks and tables with chairs that has room for about 40 people. 

Runner-up: Workiva expands, becomes a public company 
Workiva, formerly WebFilings, dedicated its new 120,000-square-foot building in Ames in September and raised more than $100 million in an initial public offering Dec. 12.


Top Philanthropic Deal

DesMoinesArts plans to create workspace for artists

Deal details: DesMoinesArts Inc. paid $2 million for the former Quest Communications International Inc. building at 900 Keosauqua Way and two other properties, with the intention of turning the 4 ½-story structure into studio and exhibition space 
for a range of artists.

Deal-makers: Justin Mandelbaum and his father, John, created DesMoinesArts Inc. as a nonprofit organization, then spent three years gauging the need for artist’s studios and the level of desire among art supporters, local philanthropists and government officials for such a project. The Mandelbaums were persuasive. The Leadership Circle of the Community Foundation of Greater Des Moines contributed $500,000, and supporters included philanthropists Jim Hubbell and Fred Hubbell, Jeff Fleming, director of the Des Moines Art Center, Bankers Trust Co. President and CEO Suku Radia and Polk County Supervisor Angela Connolly, to name a few. 

The impact: With rents that could range from $175  to $350 a month, Justin Mandelbaum said he hopes the collaborative cultural center becomes “the nation’s premier arts incubator.” The goal is to provide permanent, affordable workspace.


Top Recreational Deal

Botanical Garden outdoor gardens 

Deal details: In October, after nearly 18 months of construction, the Greater Des Moines Botanical Garden celebrated the completion of the first phase of its new outdoor gardens. The 7-acre site features a new conifer and gravel garden, water garden and a celebration lawn and garden, tied together by a walkway lined with 20 newly planted maple trees.  The initial Phase I capital campaign raised $12 million, nearly $2 million more than projected. The current Phase II “We Are a Garden Now” campaign has a $6.2 million goal. The proceeds from the capital campaign will be used to create a destination garden on the eastern slope of the grounds and to enable expansion of botanical curation, educational programming and the garden’s endowment. 

Deal-makers: The Greater Des Moines Botanical Garden board of directors, led by Fred Weitz, J.C. “Buz” Brenton, Janis Ruan and Tom Urban, along with Botanical Garden Director Stephanie Jutila, have provided the leadership for the fundraising and revitalization efforts to move forward. 

The impact: The project is transforming a tired and underused geodesic dome in Des Moines to an outdoor garden that elevates visitors’ experiences and educational opportunities. 

Runner-up: Des Moines’ selection for 2016 NCAA Basketball Tournament games — In November, the NCAA announced that Wells Fargo Arena would be the site for  second- and third-round men’s basketball tournament games in March 2016.


Top Legislative Deal

State alters its redevelopment tax credit programs

Deal details: The Iowa Legislature and Gov. Terry Branstad signed off on changes to tax credit programs that have been used to spur redevelopment projects and create affordable housing, primarily in Greater Des Moines, where a majority of the tax credits have flowed in recent years. Three incentive packages were changed: state historical tax credits, brownfield credits and a program that focused in large part on housing. One change is that the Iowa Economic Development Authority will weigh the merits of individual projects and determine whether they will receive funding. In addition, the maximum amount of tax credits that can be awarded for individual projects is $1 million, a $500,000 cut from previous years. The new laws, particularly under a program now called workforce housing, allows developers to sell unused credits to a related entity.

Deal-makers: The legislation was driven in large part by the Iowa Economic Development Authority, with much of the detail work carried out by legal counsel Tim Whipple. The IEDA wanted to find a way to extend development incentives to rural areas and to make certain that developers were using the tax incentives as last-in financing on their projects. The Greater Des Moines Partnership was an early supporter. An organization representing developers across the state ultimately endorsed the changes.

The impact: Some local developers, as well as officials with the city of Des Moines, are concerned that state dollars that have helped redevelop large chunks of blighted land downtown and created housing opportunities throughout the city will be diluted by drawing in additional projects from across the state, especially in rural communities. The legislation could lead to more housing development in rural communities.


Top Education Deal

Drake University’s STEM and building expansions

Deal Details: Drake University in October announced $65 million in new construction and renovations and the addition of specialized degree programs in mathematics, science, education, technology and health science.

Deal-makers: Drake President David Maxwell, Chairman Larry Zimpleman and other members of the Drake board of trustees, and Tom Delahunt, the university’s vice president for admission and student financial planning, were among a large team at Drake that moved to position the private university to compete more forcefully in some technical fields. The new STEM@DRAKE complex will include two new classroom buildings near Olin Hall and the renovation of Olin, Fitch, Cline and Harvey Ingham halls. The board is expected to consider final construction project details, including designs, bids and financing, as early as April. The new buildings should be open for fall 2017 classes. Renovations likely will be done sooner. The new academic programs would include bachelor’s degrees in data analytics and in kinesiology, and a secondary education teaching license endorsement in health, physical education and coaching beginning next fall. In fall 2016, the university would add a master’s degree in athletic training, a bachelor’s degree in pre-occupational therapy and a doctorate in occupational therapy. 

Impact: Drake already has a strong reputation in statistics and some other technical fields. Drake expects its total enrollment of 5,062 to rise by perhaps 50 students over the first few years of the new programs. Enrollment could rise more sharply later, but the university wants to keep its 11-to-1 student-professor ratio.

Runner-up: DMACC partners with businesses
Des Moines Area Community College announced a partnership with area businesses aimed at improving retention of information technology students by offering internships, apprenticeships, a revamped IT curriculum and better marketing. 


Top Transportation Deal

The proposed Des Moines airport expansion

Deal details: In March, the authority board that oversees Des Moines International Airport endorsed a $420 million proposal to build a new airport terminal and to juggle operations to improve efficiency and security.

Deal-makers: Chairman Ed Hansell and the other authority board members, airport Executive Director and General Manager 
Kevin Foley, finance director Brian Mulcahy and others have done early work to make the case that the current terminal, built in 1948 and remodeled repeatedly, needs to be replaced over the next decade. Foley noted that airport operations also need to be shuffled for both security and efficiency reasons. In a key move, the airport authority hired a longtime ally of Gov. Terry Branstad, businessman and consultant David Fisher, to help come up with a plan to raise $200 million to cover an expected shortfall in financing for the project. As the year ended, Fisher began meeting with community leaders and elected officials, many of whom seemed eager to replace the terminal, a project that will be one of the largest construction efforts in the state.

Impact: A new terminal is seen as essential to attracting more air service to Des Moines, which in turn promotes business development. The airport is updating its economic impact data, with a report expected early next year.

Runner-up: Mobilizing Tomorrow plan finished
Mobilizing Tomorrow, a multibillion-dollar plan was released in November, with proposals to improve roads, mass transit, airline travel and bicycle commuting through 2050. The work is seen as critical to economic development, neighborhood stability and quality of life.


Top Retail Deal

Knapp and Hy-Vee team up for downtown grocery store

Deal details: In February, Knapp Properties Inc. and Hy-Vee Inc. responded to the city of Des Moines’ request for proposals to develop a 2.3-acre city-owned parking lot at Fourth Street and Court Avenue with plans for market-rate apartments and an urban-oriented Hy-Vee food store, complete with amenities such as a bakery, dry cleaner, bank branch and sit-down restaurant. The development partners are waiting to finalize financing for what is expected to be a $30 million project, and  have run into some opposition from Court Avenue entertainment and dining venues.

Deal-makers: Gerry Neugent and Randy Edeker’s Knapp/Hy-Vee proposal was among five submitted to the city after Minneapolis-based The Opus Group unveiled its plans for a mixed residential and commercial development at the site. Prompted largely by Hubbell Realty Co. President and CEO Rick Tollakson, the city decided to seek proposals from any developer interested in the site. Although Hy-Vee and Knapp had scouted locations for a downtown grocery store, they were caught a little off guard when the city asked for development proposals for the site, which the city purchased beginning in 2000 for about $3 million from a variety of property owners. Before the financial crisis, other developers, including Hubbell, tried but failed to piece together a development scenario for Fourth and Court. Knapp and Hy-Vee, Hubbell, Opus, Sherman Associates Inc. of Minneapolis and Mandelbaum Properties all submitted proposals. Based in large part on the desire of downtown residents to have a nearby grocery store, city staff members carried the Knapp/Hy-Vee proposals to the City Council, which approved the plan on a 6-1 vote, with Councilman Skip Moore the lone dissenter.

The impact: Late this year, organized opposition emerged among Court Avenue business owners who feared that the development would eliminate parking for patrons. The Court District Association also said a Hy-Vee would not be a good fit for the entertainment district, and some business owners said they were concerned that Hy-Vee would draw away customers, especially over the lunch hour. The Downtown Neighborhood Association supports the Hy-Vee grocery store. 

Runner-up: Proposed Altoona outlet mall
In April, developer Mike Whalen, president and CEO of Heart of America Group, announced plans for a 325,000-square-foot upscale outlet mall adjacent to Bass Pro Shops at the junction of Interstate 80 and U.S. Highway 65 in Altoona. 


Top Expansion Deal

Wells Fargo’s $100 million expansion of its West Des Moines campus

Deal details: An additional 265,000 square feet of office space and an additional parking garage are nearing completion at the West Des Moines campus of Wells Fargo & Co. The $100 million project, which broke ground in April 2013, is expected to be completed this spring.  

Deal-makers: Mike Heid, president of Wells Fargo Home Mortgage, and Scott Johnson, Wells Fargo regional president for Iowa and Illinois at the time the expansion was announced, were among key leaders who worked with West Des Moines Mayor Steve Gaer and other city officials to make the expansion possible.

The impact: The expansion of the home lending headquarters for the largest U.S. mortgage originator was taken as a positive sign for future growth, despite a temporary dip in mortgage lending. The project will provide space for an additional 1,800 workers for Wells Fargo, which is West Des Moines’ largest employer, with approximately 13,500 employees. In November, Wells Fargo sought approval from the city to modify its expansion plan to include a 1,600-square-foot garden on the grounds, which Wells Fargo workers will use to grow vegetables for local food pantries, as well as a nesting pole for ospreys. 


Top Tech Deal

Microsoft carves a $1 billion data center out of golf course 

Deal details: Microsoft Corp. paid nearly $10 million for nine holes of Willow Creek Golf Course and adjoining properties in 
West Des Moines, where it is building a $1 billion data center that will serve the company’s cloud computing services.

Deal-makers: West Des Moines Community and Economic Development Director Clyde Evans said this deal was years in the making. In fact, it might be traced back to 2007, when Microsoft announced plans for its first West Des Moines data center on a 
40-acre site near 88th Street and Booneville Road. At that time, the company said there was more to come. The Clark family, owners of Willow Creek, helped make the current deal happen, tidying various parcels of land that were under the control of various entities representing family members and acquiring others in an attempt to deliver a bundled package to the buyers. And you can’t fault city leaders for pushing the deal forward, all in anticipation of its first major commercial development in the southeast section of the city, one that could generate $8 million a year in property tax revenue.

The impact: Microsoft received $20.3 million in state sales tax rebates and $18 million in incentives from the city of West 
Des Moines, primarily in the form of improvements to streets and other infrastructure. In terms of jobs, the data center will 
employ about 80 people. More important, the property tax revenues generated by a minimum agreed assessment of $255 million will allow the city to extend utilities and build out roads to encourage additional development in the area.

Runner-up: The use of drones in commerce
Looking like oversized spiders, drones have been taking pictures of Greater Des Moines real estate and development projects. NAI Optimum in West Des Moines and Peoples Co. in Clive have used them to track projects and give clients a top-down view of properties.


Top Energy Deal

Proposed Dakota Access Pipeline 

Deal details: In June, Dallas-based Energy Transfer Partners LP, one of the largest pipeline operators in the United States, announced plans for a 1,100-mile pipeline to carry crude oil from the shale oil fields in North Dakota to its hub in Patoka, Ill. If approved by state regulators, the 30-inch-diameter pipeline would bisect 17 counties from the northwest to the southeast part of the state and would move as much as 320,000 barrels of oil daily. From Illinois, the pipeline would connect with the company’s existing Trunkline Pipeline to a terminal in Nederland, Texas. The company also plans to build a rail terminal in Illinois to access East Coast refineries. The Dakota Access Pipeline would be the first major pipeline construction project of any kind in Iowa since 2000. 

Deal-makers: The three-person Iowa Utilities Board, chaired by Libby Jacobs and with members Sheila Tipton and Nick Wagner, has the final say on whether to approve the pipeline project through the state, after reviewing comments from organizations and individuals in support of and in opposition to the project. 

The impact: In Iowa, the project would generate more than $1 billion in production and sales and $390 million in additional labor income during its construction phase and generate about $27 million in additional property tax revenues in the state, according to an economic analysis conducted for the pipeline company. The four-state region of North Dakota, South Dakota, Iowa and Illinois would see an increase of 33,000 temporary full-time jobs during the two-year construction phase of the 1,100-mile underground pipeline. During the construction stage of the project in 2015-2016, Iowa landowners would receive about $60 million in “easement and damages” payments for the restoration and use of their rights of way, the study estimated.

Runner-up: MidAmerican Energy makes additional wind investment 
In October, MidAmerican Energy Co. announced plans to increase its wind energy investments in Iowa by up to $280 million, specifically by adding up to 64 turbines in Adams County and three in O’Brien County. The new project adds to the $1.9 billion in spending on wind generation the company announced in May 2013, meaning a combined $2.2 billion in development over the next two years. The projects are expected to save MidAmerican customers $93 million over 10 years by reducing fuel costs and helping to stabilize rates.