800 jobs are coming to city
VF Corporation, the parent company of popular outdoor brands like The North Face, JanSport and Smartwool, announced Monday it will move its global headquarters to Denver, bringing 800 high-paying jobs with it.
Just how soon all those big earners could be on the ground in the Mile High City is up in the air, VF officials say. If all of those positions are squared away by 2026 there is more than $27 million in tax incentives in it for the company.
In a new release issued Monday, VF chairman, president and CEO Steve Rendle called Denver “a great strategic fit for our business.”
“We believe that the creation of our new headquarters in the area will help us to unlock collaboration across our outdoor brands, attract and retain talent, and accelerate innovation,” Rendle said.
About 85 VF executives are expected to move to Denver next spring. They are the first wave of a relocation and consolidation plan that will see The North Face, JanSport, Eagle Creek and Altra move their headquarters into Colorado from elsewhere and see Steamboat Springsbased Smartwool move its leadership to Denver.
To put the company’s size in perspective, VF had a market value of $36.8 billion at the close of trading Monday. Colorado’s largest public company, Newmont Mining, is valued by investors at $19 billion, while the second largest, Dish Network, is valued at $16.4 billion.
The relocation announcement came after the Colorado Economic
Development Commission on Wednesday provided the company, going by the codename Project Cardinal, with $27 million in job growth incentive tax credits, the second largest award ever. Of those credits, $13 million are transferable, meaning they can be sold to other companies.
“We are thrilled to welcome a new partner that embodies the values that define Colorado,” said Gov. John Hickenlooper in the release. “VF’s move underscores the critical driver that the outdoor recreation industry plays in our economy where business meets lifestyle.”
VF is currently based in Greensboro, N.C. Following the arrival of its top executives next spring, the company expects the leaders of its five subsidiaries to arrive in Denver over the rest of 2019 and into 2020, though it could take longer to hit the projected 800 positions.
The jobs come with an average annual wage of $185,721. That is nearly tri- ple the average wage offered in Denver today and is the highest figure a company that has applied for state economic development incentives has brought to the table. VF officials declined to provide a salary range for the incoming jobs. Rendel reported $13.7 million in compensation last year.
The only incentive arrangement larger than VF’s was Charter Communications’ $34.4 million package approved last year. That payment hinges on Charter creating 1,200 new high-paying jobs in the state by 2025.
The job growth incentive tax credits program has existed in Colorado since 2009, but the five largest packages have all be approved in the last three years. The fifth largest, $18.7 million, was approved earlier this year for a stillunnamed firm expected to bring 850 new jobs to the state.
The credits are “Colorado’s most effective state economic development tool,” Michelle Hadwiger, the office of economic development’s deputy director, said via email Monday.
“We offer performancebased tax credits when we are in a competitive multistate process and compete against states with direct incentives and aggressive tax credits,” she said. “Nothing is paid up front and credits are only calculated and issued after net new jobs have been created in Colorado and new employees have started paying Colorado income and sales taxes.”
In 2014, the state agreed to offer $15.5 million in credits to Lockheed Martin in return for 500 net new jobs. As of Dec. 31, 2016, the company had hired 1,145 new workers in Colorado, but only 500 counted toward the credits, resulting in $2.24 million flowing to the company as of the middle of last year, state economic development officials say.
VF has made it clear the incentives were not the only factor that drew the company west. Rendle on Monday vowed to match every tax credit dollar received with a donation to the VF Foundation, which will then be put to use supporting local charitable causes.
“VF’s Purpose Statement declares that we will power movements of sustainable and active lifestyles for the betterment of people and our planet. We will demonstrate that commitment to the Colorado community,” he said.
It appears to be the first time a company receiving state tax credits has committed to make a comparable match in charitable donations in the state.
“VF is redefining corporate social responsibility and we are so gratified that they have decided to choose Colorado,” Colorado Office of Economic Development and International Trade executive director Stephanie Copeland said in the release.
Hickenlooper’s administration has made recruiting outdoor recreation companies a priority. Last summer, metro Denver snagged the Outdoor Retailer show from Salt Lake City, where it had been for more than two decades. But the outdoor apparel industry is struggling with declining sales as millennials shift their spending habits.
VF is a Fortune 250 company with $11.8 billion in revenues and nearly 70,000 employees and operations across more than 170 countries. Some of its other popular brands, which aren’t relocating to Denver, include Vans, Timberland and workwear brand Dickies.
Monday was a busy day at VF headquarters. Not only did the company announced its HQ move, it also made public plans to spin off its denim brands, headlined by Wrangler and Lee jeans, into a standalone $2.5 billion-per-year company. The spinoff, so far being called “NewCo,” will remain in Greensboro. In the most recent financial quarter, VF’s activewear revenue shot up 25 percent to $1.1 billion. Revenue from denim rose 3 percent to $603.7 million.