MidwestOne Financial (MOFG) in Iowa City is finally ready to make much needed improvements to its century-old headquarters.
The six-story building at the corner of Clinton and Washington streets lacks central air, and, until recently, heating came from an ancient steam boiler and radiators. The top floors have had "almost no mechanical renovations" over the years, says Dan Black, MidWestOne's facilities director.
Given all that, one would think that moving to a new building would have been a serious option for the $1.7 billion-asset company. Its board briefly considered relocating, but nostalgia won out. Last month, MidWestOne said it would stay put and spend nearly $14 million to overhaul its shopworn office.
To get an idea of how big this investment is for MidWestOne, consider that the much larger Associated Banc-Corp (ASBC) in Green Bay, Wis. with $23.6 billion in assets committed about $20 million to renovate its headquarters. Associated moved into its new digs last week.
As counterintuitive as it seems, embarking on such a big-ticket renovation, rather than pulling up stakes, was a logical choice for MidWestOne. After all, the company has always operated from the building, dating back to its inception as Iowa State Bank in October 1934.
"We're a community bank and we believe our headquarters ought to be in the heart of the community," says Kevin Monson, MidWestOne's chairman. "It was a very easy decision to say, our heart is here. This is the right thing to do."
MidWestOne was ready to begin the project about six years ago, but plans were shelved when the 2008 recession hit. Management believed that costly restoration "was probably not the right message to send" in the teeth of a severe downturn, says Charles Funk, the company's president and chief executive.
With the recovery in its fourth year, MidWestOne finally feels comfortable enough to give the project the green light.
"It is not a cheap project, but it's a statement that we believe strongly in the future of our company and strongly in Iowa City," Funk says. "We can't forget our roots."
Wherever possible, the renovation aims to return the building to its 1913 appearance, Black says. Interior renovation aims to restore the hardwood floors, wood paneling in the hallways and the sturdy wooden office doors topped by transoms. MidWestOne even wants to restore the original patina, Black says.
External work includes plans to install a new cornice identical to the terra cotta one that originally adorned the sixth story facade.
MidWestOne expects to finish the project by early 2016, Monson says. At that time, the building will be added to the National Register of Historic Places, which makes sense, given its pedigree.
The building was designed by Proudfoot, Bird and Rawson, a renowned Iowa architectural firm. Across the state, the firm is "revered as one of the best firms Iowa has ever grown," says Monson, who is also a practicing architect and president of Neumann Monson, an Iowa City architectural services firm.
Proudfoot, Bird and Rawson received about 660 commissions in Iowa from 1885 to 1940, including 29 for banks, according to the National Park Service. The firm was at the peak of its popularity in Iowa when it designed the building at 102 South Clinton.
The original tenant was Johnson County Savings Bank, which failed during the Great Depression. Iowa State Bank moved in soon after Johnson County Savings Bank collapsed, so the building's primary tenant has always been a bank.
The building still bears a vestige of Johnson County Savings; the architects had a "JSC" monograph carved into the exterior under an ornate lion's head.
The architects "always incorporated sculpture into their buildings," says Steve Stimmel, a Des Moines, Iowa, architect. "This building typifies their work. ... It had a very strong first-floor base and a strong capital with a historic cornice. It is definitely an upscale kind of building."
Stimmel, who was raised in Iowa City and opened his first savings account at 102 South Clinton, is a partner at Brooks Borg Skiles, the successor to Proudfoot, Bird and Rawson. The building may look a little careworn, but it "has held up quite well," he says.
MidWestOne can finance the project largely because it dodged the worst of the recession and financial crisis. The company earned $42 million from 2009 to 2012, and another $9.3 million in the first half of this year.
The most visible aspect of the renovation will be the bank's ground-floor branch. MidWestOne plans to restore the branch to its 1913 appearance, right down to the original color scheme. The effort is noble at a time when many banks are looking to push the envelope with branch design or looking to use less space.
"There will be a very significant historical look," Black says. "The teller line will be appropriate to its surroundings, but in the old days it had cages. We won't go that far."