State Approves Its Half of Fiserv Subsidy

Fiserv and Kohl’s at HUB640. Rendering submitted to city.

The Wisconsin Economic Development Corporation (WEDC) approved its half of the complicated subsidy agreement Thursday to bring financial technology services company Fiserv’s headquarters to downtown Milwaukee.

The company is eligible for up to $7 million in state income tax credits from WEDC if it creates new 250 new jobs in Milwaukee and 72 other jobs across the state within five years, which would bring its total Wisconsin employment to 980.

In November, Fiserv, city and state officials announced a proposal to relocate the headquarters of the Brookfield-based company to the eight-story HUB640 building in Westown.

The state subsidy would be paired with a $7 million tax incremental financing (TIF) district subsidy the City of Milwaukee would provide from increased property revenue generated by the company’s relocation. The city also plans to use $4.6 million in incremental revenue from the development to make nearby public improvements.

The city approved its share of the subsidy in December, but the state figures were not public until Thursday.

“Their decision to make Milwaukee their global headquarters is not only a win for the city, but one that will drive job growth and prosperity statewide. We are pleased to be able to assist them as they embark on this new chapter in Wisconsin,” said WEDC Secretary Missy Hughes in a statement Thursday after the board approved the agreement.

“WEDC has added an important piece to finalize the Fiserv move to the center of our city.  I remain enthusiastic about the company’s choice to grow in Milwaukee,” said Mayor Cavalier Johnson. “Fiserv is a valued part of Milwaukee’s economic future, and I look forward to welcoming the company’s headquarters and the hundreds of employees who will work here.”

The company’s headquarters currently are in Brookfield, though the vast majority of its 40,000-member workforce is outside of Wisconsin.

“Fiserv is proud to call Wisconsin home, and we look forward to continuing to grow in Milwaukee’s vibrant downtown area,” said Frank Bisignano, the company’s chairman, president and CEO who is based in New York City. “We are energized to create a new dynamic workplace experience where we will bring people together to further inspire innovation and collaboration, and attract the best talent to serve our clients.”

The company’s move has been several years in the making. In 2017 the Fortune 500 company confirmed it was considering multiple sites in Milwaukee, but never moved. In 2019 it acquired First Data Corporation, which Bisignano led, for $22 billion and set about restructuring or closing several dozen of its offices spread across the country.

It maintains major offices in Brookfield, suburban New Jersey, Georgia, Nebraska and Florida and an executive office in New York City. It opened a new $106 million, 428,000-square-foot office in Berkeley Heights, NJ in December that is to be home to 3,000 employees.

The state credits would be awarded across three tranches – retaining the corporate headquarters and jobs, creating new jobs and capital investment. The city agreement calls for at least $37 million to be invested, though the WEDC press release refers to a $40 million estimate.

The city’s agreement is structured as a developer-financed tax incremental financing (TIF) district. The city would effectively rebate increased property tax revenue from the development over a period of no more than 20 years. Fiserv would be eligible to collect up to $7 million plus 4.5% interest. Unlike a traditional TIF district, the agreement places no risk on the city if the development fails to yield the expected increase in property tax revenue. The existing property tax revenue from the property would continue to flow to the city and other property taxing entities under the proposal, with only the increase diverted.

To earn the full city subsidy, Fiserv must eventually employ at least 780 full-time equivalent employees at the site. The agreement sets a four-year ramp-up period that starts at 580 employees in 2024 and grows to the full amount in 2027.

The TIF term sheet says Fiserv is expected to relocate employees working in finance, communications, IT, product development, human resources, benefits and legal functions. And even if Bisignano never works a day in the building, the company must refer to the facility as its “global headquarters” in marketing materials.

Fiserv would lease the southern portion of the first floor as a lobby with the offices and cafeteria on the third, fourth and fifth floors. The company, according to the city report, is to lease 144,000 square feet of space in the building.

The eight-story Boston Store Building was acquired by Chicago-based North Wells Capital in 2017 and fully redeveloped as HUB640 following the department store chain’s 2018 bankruptcy and subsequent liquidation. North Wells planned to strategically redevelop the former Boston Store Building, but that work was expedited when Bon-Ton went from downsizing to liquidation. In 2021, the company gutted and rehabbed each of the former Bon-Ton floors. New common spaces were developed and a portion of the loading dock structure was converted to a rooftop deck.

For more information on the complicated city agreement and proposed public improvements, see our December coverage.