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As VF Corp. moves its HQ to downtown Denver, CEO vows to repay $27 million in tax incentives with donations

Outdoor juggernaut will set up homebase for 800 execs and brands including Smartwool and The North Face at 1551 Wewatta St., the former headquarters of Gates Corp. and DaVita.

Steve Rendle near a climbing structure
VF Corp. CEO Steve Rendle speaking near a climbing structure The North Face helped fund at the Montbello Open Space Park in north Denver. The North Face, a brand owned by VF, will move to Denver from Alameda, California, when VF's corporate headquarters moves to Denver from North Carolina.
John Frank, The Colorado Sun
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The 70,000-employee VF Corp. on Tuesday said it would take over a 10-story LoDo building to anchor its North Face, Smartwool, JanSport, Altra and Eagle Creek brands in Denver.

The company, which last month revealed it was relocating from Greensboro, North Carolina, has inked a 12-year deal for the entire building at 1551 Wewatta St., a 285,000-square-foot, LEED Gold Certified building that will serve as the company’s 800-executive command post. The building — the former headquarters for both DaVita and Gates Corp. — has room for 1,200 workers, giving VF space to grow. Renovations on the building, a quick walk from Denver Union Station, will take a year and are expected to begin in early 2019.

The departure from North Carolina, as well as moving The North Face from the San Francisco Bay Area and Smartwool from Steamboat Springs, is part of a reshuffling that will spin off VF Corp.’s slower-growing denim bands — including Wrangler and Lee — into a separate and yet-unnamed company.

It’s yet another “point of transformation” for the 119-year-old company, CEO Steve Rendle said. In a conversation with a handful of Denver reporters in late August, Rendle explained why Colorado won out as the new headquarters.

Q: You said your company’s values aligned well with Colorado’s values, citing the state’s embrace of public lands as well as its championing of environmental protections and access. The state also offered you quite a carrot: $27 million in tax incentives. Riff a bit on how you weighed both those when you considered Denver as a new home.

Steve Rendle: “Our purpose statement is to create movements and sustainable and active lifestyles for the betterment of the planet. Colorado aligns extremely well with what we intend to stand for and the change that we intend to drive. We have purposely chosen the word ‘movement,’ with 70,000 employees driving against a common vision to really create change in a positive way in the communities we that we live and work in.

As we looked at the different cities, we spent a lot of time understanding what those communities stood for and we spent a lot of time explaining to them what we stood for, and was there alignment and could we see ourselves coming in and becoming a positive aspect of driving the change or building on the change that was taking place.

As we got to know Denver and Colorado — the more and more we interacted with different individuals — the more and more clear it became that this was a good choice. The incentives were an important aspect. We are a publicly traded company … and this will cost about $70 million over the course of the coming years to execute this move and set ourselves up in a working location here in Colorado. The incentives help us offset that cost. They allow us to continue to deliver to our shareholders that we have committed to and at the same time they allow us to continue to contribute to our our foundation and further our philanthropic giving. We wanted to signal to Colorado that, as we enter, the incentives are important and over time we will match that dollar for dollar and give back at the same level to programs and philanthropies that align with our purpose.”

Q: Change you hope to stand for, driving the change and building on the change here in Colorado. Can we interpret anything in that as a political statement or position?

A: “No. Not at all. All of this aligns with your governor. I’ve gotten to know him over the last couple weeks and I’ve got to say his vision to articulate that and how he has really, from a nonpartisan position, tried to be inclusive around building a business environment tied to the outdoors. That is everything that the brands moving here stand for, being in a state that is about building positive relationships with businesses in a manner that allows us to thrive and, in our case,

deliver to our shareholders while also lining up with those things that are important we stay connected to. The change I’ve mentioned is the change he has put in motion over his tenure and I assume Coloradans believe in that and that will continue on as the next government comes in.”

Q: Of the 800 jobs. How many will be relocated jobs versus new-hires?

A: Hard to say. Over the coming three, four, five months there will be a tremendous number of employee visits to Colorado. We have offered relocation to every one of those employees. These are people who have committed themselves to our brand and we would like to get them to come on this journey. We will see how many actually commit. We do believe there will be a substantial hiring of local talent.”

Q: You said Colorado ticked a lot of boxes in your nearly year-long search for a new home. What boxes didn’t get ticked? We hear a lot about the increasing cost of housing here, as well as traffic, the lack of warehouse space and all the other pains of a growing city.

A: Yes, the cost of living for some will be different. Housing in Denver is more expensive than it is in North Carolina, but it is cheaper than in California. So that was a box that everyone has to look at as individuals. Our ability to attract and retain top talent in a work environment, where you have to look at people’s cost of living, but also access to the things they love to do, and Colorado is very positive on that side. Cost of living and traffic for some people will be at the top of their list. But I don’t know, I drive around here and I lived in California for 14 years and this is not so bad.”

Q: You are adding jobs here, but in relocating Smartwool from its home, you are taking away as many as 80 jobs in Steamboat Springs and Routt County. Have you guys started thinking about how you might offset that economic blow, which local economists there estimate will reduce local spending by nearly $3 million a year?

A: “We have a long history in Steamboat and a lot of passion around what that community means to our Smartwool employees. We have a lot of empathy. These decisions are not taken lightly and we love the environment there as much as our employees do. This was a business decision to really bring together a stronger pool of talent to drive against a collective vision. As we think about that community, we do a lot to support it today and we will continue to do that. Can we offset everything that Steamboat is worried about? I’m not sure. But working together with the state and ourselves, Steamboat will probably be able to mitigate the impact they are looking at right now.”

Q: Did you ever consider leaving Smartwool in Steamboat Springs, like you are leaving Vans in Southern California and Timberland in New Hampshire?

A: “If we leave one while having a look at the other four (lifestyle brands: The North Face, Altra, JanSport and Eagle Creek) and telling them they had to come, that’s not how we work. As we look to acquire in the future, our intention will be to probably bring those companies here. We are that committed to what we believe we can create here with this co-location.”