Downtown Minneapolis loses first large employer in years

Portico Benefit Services is leaving downtown Minneapolis and relocating to Edina.

Why it matters: Downtown Minneapolis and its restaurants and retailers need all the workers they can keep as companies move to hybrid work models that will reduce the daily headcount in the city.

The details: Sources tell Axios that Portico, a benefits provider for employees of the Evangelical Lutheran Church of America, is leaving 60,000 square feet in RSM Plaza on Nicollet Mall.

• Portico is leasing 25,000 square feet in the 7700 France building, which recently underwent a major renovation. The size difference in the two leases is further proof that companies need less space in a post-pandemic world.
• "We found an alternative location that will allow for additional flexibility as we move to a more agile, hybrid work environment for the future," Portico CFO/COO Stacy Kruse said in an emailed statement.

Context: Portico is the first sizable company to leave downtown for the suburbs since TCF Financial departed in 2015 for Plymouth.

• It's not clear exactly how many employees Portico has downtown, but the number is likely in the hundreds based on the space.

What we don't know: Exactly why Portico made the decision, other than that its lease was up.

The intrigue: The Minneapolis Downtown Council last summer warned that downtown could lose as many as 10,000 jobs due to public safety concerns and the City Council's talk of defunding police.

• "I think we will hear of more," Downtown Council President Steve Cramer told Axios. "But it will be a lot less than we were fearful of."

This story first appeared in the Axios Twin Cities newsletter, designed to help readers get smarter, faster on the most consequential news unfolding in their own backyard.

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