Dave Reid

Kohl’s, The Moral of the Story

By - Feb 21st, 2012 06:04 pm
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Park East Redevelopment Area

Park East Redevelopment Area

For over a year the City of Milwaukee, Milwaukee County, and various regional entities worked together in attempt to bring Kohl’s corporate headquarters to downtown Milwaukee.  Unfortunately, they were unsuccessful.  Some have been quick to judge saying the moral of the story is, the city is a failure, and Mayor Tom Barrett can’t get the job done.  Now, it is true the city didn’t win, this time, but is the moral of the story, failure?

For some, the standard being put forward would rate Ryan Braun, Brandon Jennings, and Aaron Rodgers as failures, because they don’t win or succeed 100% of the time.  The sports fan knows that in baseball All Stars fail nearly 70% of the time, in basketball All-Stars don’t even shoot 60% from the field and nobody hits 100% of their free-throws, and in football even Aaron Rodgers only connects with his receivers 68% of the time.

What’s worth noting here isn’t failure, it is that Milwaukee is no longer sitting on the sidelines.

Not in recent memory has a deal been so aggressively pushed by the City of Milwaukee and Milwaukee County.  Mayor Barrett, said it well,  “we worked more closely with the county and County Executive in the past nine months, than we have in the past nine years.”  It is this working together between the City of Milwaukee, and Milwaukee County that is to be remembered, because it puts Milwaukee in the game.

The game plan followed throughout this effort involved huge financial incentives, tax breaks, and other accommodations for Kohl’s.  The city was prepared to create a $100 million TIF district to develop two large parking garages for Kohl’s.  And if $100 million worth of parking wasn’t enough to satisfy Kohl’s mobility requirements,  Milwaukee County was going to offer thousands of free bus passes.  The City of Milwaukee working with partner entities had also put together $170 million in tax credits, and Milwaukee County was going to give Kohl’s the land for free to reduce the cost of development.  Finally, to sweeten the deal Milwaukee County was to provide numerous advertising opportunities for Kohl’s to cement their brand throughout Milwaukee.  It clearly wasn’t for the lack of effort, or value, that Kohl’s choose to pass.

Kohl’s, the City, and the County discussed the deal for months, going through over 20 iterations of the design, with the City and County exhausting nearly every financial incentive they had available to make the deal work. Well Kohl’s has yet to commit to a new location, it’s clear that a lack of effort didn’t prevent Milwaukee from landing Kohl’s.

The moral of the story isn’t that this was a failure.  The moral of the story is that for the first time in a long time, if you want to bring big business to the city, the City of Milwaukee and Milwaukee County together will leave it all out on the floor.

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10 thoughts on “Kohl’s, The Moral of the Story”

  1. CJ says:

    I don’t see it as a failure at all, just the fact that they even considered downtown is a huge step, and anyone that’s seen their current location would know how huge of a move that would have been.

  2. Rob says:

    I think Milwaukee didn’t get Kohl’s because of mistakes municipal leaders have made in the past. The main theme I’m thinking of is transit.

    1: I am unaware of any bussing system in metro Milwaukee that crosses county lines, and from what I’ve read, a significant number of employees at Kohl’s headquarters live in Waukesha and Washington counties.

    2: I think the plan was hamstrung because the Fond du Lac Freeway was never connected to Interstate 43 and the Park Freeway. Sure, we still have Fond du Lac Avenue as a conduit, but the reputation that comes with that part of Milwaukee gives me pause. I’d drive the Fond du Lac Freeway to downtown Milwaukee, but I would not want to drive on Fond du Lac Avenue, where I’d have to do stop-and-go driving through one of the more notorious segments of Milwaukee.

    I apologize if my thoughts sound racist or elitist, but that is the way I’m thinking. If Milwaukee realized in the 1960s, 70s and 80s that it had to work with the suburbs and surrounding counties, Milwaukee might have been able to snare Kohl’s because the infrastructure and good relations would already be in place.

  3. RZ says:

    Why not shop that same package to bring in a Company the size of Kohl’s
    from Chicago ,New York or the West Coast.

    Kohl’s had an opportunity, and for what ever reason, turned down an incentive package
    that most Companies would have jumped on.

    They could have split there Campus, just like Northwestern has done between Milwaukee and Oak Creek,

    The young and creative talent that work in that industry , want to be in the Center of the City and not in a suburban wasteland (Nothing against MF).I’m wondering if NYC gave any concessions to Kohl’s to bring them to the City Center.

  4. Dave Reid says:

    @RZ Oh yes. That is what I believe this partnership between the City an County can now, finally, lead to.

  5. Dave Shires says:

    The failure here is that our economy still depends on a suburban sprawl/strip mall fabric and Kohl’s didn’t have the balls to rock the boat for fear of confusing some of their employees. Not that one should ignore their employees… but they would have gotten over it. Kohls just doesn’t really want to be a standout company, apparently. What can you do? Move on and hope for the best….

  6. John says:

    Kohl’s certainly knows its employees, customers, and suppliers best and apparently made their best decision. They deserve a salute for considering Milwaukee.

    However, I think this marks Kohl’s as an “old line” retailer much as Sears–fading off into the suburbs in terms of product, marketing, and innovation. It apparently has little interest in the creative, energetic individuals who thrive on urbanism and who might have created new products and approaches for them. To contemplate the new shades of khaki for their cargo pants perhaps doesn’t require much creativity anyway and could easily be done sitting out in a cornfield. However, as a contrast, there is a big, new headquarters complex for Amazon.com right in Seattle, in the South Lake Union district. (See also http://online.wsj.com/article/BT-CO-20120217-710752.html). And a good bet for innovation and creativity in retailing is away from companies like Kohl’s and more toward Amazon.com.

  7. Nate says:

    I appreciate this discussion. It’s refreshing to see the county and city working in tandem, only good will come of that. If Milwaukee’s miss on Kohl’s came down to the inability of a nine figure bribe being enough to overcome the idea of suburbanites speeding through the portion of metro Milwaukee that contain minorities on their way to work, then we don’t stand much of a chance. I’m assuming that’s not what it was. Hopefully the city and county will continue to work together to deal with the sorts of challenges that prevent a company like Kohl’s from jumping at the chance to move downtown.

  8. Dave Reid says:

    @Nate Yeah I agree it was very unlike transportation and access was an issue. Right off the freeway, near transit and so on….

    I truly believe it was more of too big of a cultural change for the company… change was too big a decision.

  9. Joel says:

    Kohl’s workforce will plummet with $4.50 gas coming and staying soon. Living/working close to downtown will again become more and more practical.

  10. Hyrax Suzuki says:

    I’m pretty depressed about it. I give Kohl’s ten years before they’re out of business. This decision proves they’re a dinosaur on the way out.

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