Allstate Insurance planning 2,500 new jobs in Chandler

Allstate Insurance Company plans to bring 2,500 new jobs to Chandler and could open a new corporate campus in the area.

Allstate would become part of a growing number of large insurers operating in metro Phoenix, including State Farm in neighboring Tempe and USAA in north Phoenix.

Allstate already leases 217,000 square feet of office space at Park Place in the Price Road Corridor, an employment center near the loops 101 and 202, and at One Chandler Corporate Center, near McClintock Drive and Chandler Boulevard, according to city documents.

The city has been in discussions to have the Illinois-based insurance company build an insurance operations center in Chandler since 2017.

The Chandler City Council will discuss a development agreement with Allstate at a study session Monday in which the city would reimburse Allstate roughly $5.4 million for job creation and development fees if it agrees to build a corporate campus in the East Valley city.

The payments would be made to Allstate over a nine-year period if the company complies with the terms of the agreement, according to city documents.

The council will vote on the agree-

ment Thursday.

As part of the development agreement, Allstate has agreed to establish an insurance operations center at a location with at least 225,000 square feet of office space and hire 2,500 new employees within five years, according to city documents.

Chandler would reimburse Allstate nearly $1.5 million for hiring, training and relocating employees to Chandler.

The city would pay Allstate $600 for each position with a salary of at least $65,000 and $400 for each job paying below $65,000, according to the deal.

The first 2,500 jobs must be filled within five years of signing the agreement to qualify for reimbursement.

After the initial 2,500 jobs, the city would reimburse Allstate $600 for any position paid $65,000 or more and $200 for jobs below that salary up to 4,000 jobs.

Positions relocated from another Arizona facility would not qualify.

The company has already created 500 new jobs in Chandler that will qualify for reimbursement, according to city documents.

The first 2,500 positions would result in a payroll benefit of more than $102 million annually, according to city documents.

Allstate has also discussed the possibility of developing a 250,000-squarefoot corporate campus in Chandler. The campus would result in a capital investment of at least $35 million, according to city documents.

Under the proposed development agreement, the city would reimburse Allstate $3.9 million in development-related costs if Allstate builds a corporate campus in Chandler.

A city-commissioned fiscal impact analysis found that whether Allstate leases space in Chandler or builds its own facility, the company would generate more than $5.29 million in benefits to the city over an eight-year period, exceeding the proposed incentives, according to city documents.

Allstate is required to reimburse the city for all payments if it chooses to relocate from the currently leased space, or if it locates its corporate campus outside of Chandler.

Allstate considered several other cities, including two Valley cities and Boise, Idaho, but ultimately settled on Chandler because the city offered the company various incentives, according to city documents.

Chandler Mayor Jay Tibshraeny said the insurance industry is one of the city’s “target industries,” and the city is eager to welcome Allstate to the East Valley.

“We seem poised to grow our insurance and financial services employment base, with a world-renowned Fortune 100 company in one of our target industries,” he said. “Chandler’s strong workforce and available office space continue to make the city a desirable location for these highly sought after companies.”

Allstate joins other large insurers operating in metro Phoenix. State Farm, with a campus overlooking Tempe Town Lake, is the 26th largest non-government employer in Arizona with 6,700 workers, according to the Republic 100 report published in April. Another large insurer, USAA, employs about 4,000 people, primarily in north Phoenix.

Allstate, based in Northbrook, Illinois,ranks as the fourth largest property and casualty company in the U.S., with roughly a 5-percent market share of premium income, according to a 2017 report by the National Association of Insurance Commissioners. State Farm is first, followed by Berkshire Hathaway and Liberty Mutual.

Allstate generates most of its business from auto, homeowners, business and other types of insurance, though it also provides investment, retirement and other financial services.

Allstate has enjoyed strong growth this year, boosting its number of policies to 96.2 million at the end of the third quarter from 77.6 million one year earlier. That helped the company earn $2.4 billion on revenue of $30.3 billion over the first nine months of 2018, up from $1.7 billion in profits on $29.3 billion in revenue over the same span one year earlier.