United expected to shift more workers to downtown Chicago

The suburbs are about to lose one of their oldest employers.

UAL Corp.'s United Airlines could announce today that it plans to move its operations control center from Elk Grove Township to Willis Tower in downtown Chicago.

The deal, long in the making, offers grants, a TIF arrangement and job training, said officials with the city of Chicago. But, with a loss of tax and other economic revenue and about 2,800 jobs, it also strikes a blow to the suburbs, where United has maintained operations for nearly 50 years.

While United spokeswoman Megan McCarthy declined to discuss any deal, Rolling Meadows Mayor Ken Nelson said at least two sites in his town were among the finalists.

"I'm disappointed, but pleased to know we were in the running," he said. "That speaks well of Rolling Meadows."

The long-struggling United has been looking at various ways to cut expenses, including relocation. It already shifted other corporate functions out of that location in early 2007 and took a long-term lease for a new headquarters on Wacker Drive in downtown Chicago. The new headquarters started with 350 workers, but now has about 650 there, said McCarthy.

United owns the Elk Grove Township campus, which opened in December 1961. It has about 1.7 million square feet of office space, but about 40 percent of it isn't being utilized, McCarthy said.

That campus was a pivotal spot during the terrorism attacks in Sept. 11, 2001, which tracked the hijackings. At that time, the campus had a work force of about 4,300, compared to its current 2,800.

This also may be a good time for the move. With the depressed office rental market in downtown Chicago, United could get quite a deal on rent, said Basili Alukos, an analyst with Chicago-based Morningstar Inc.

"My guess would be the potential incentive savings cancel out any additional costs associated with the move, and the lower rent would be a net positive for United going forward," Alukos said.

Also the recruitment of talent, including younger workers, may be easier if its operations were all in the city, said Ian Savage, associate chair of economics and transportation at Northwestern University in Evanston.

"For younger people, working in the Loop is more attractive than Elk Grove Township," said Savage, "This could be part of their motivation to move. The city offers younger workers more if they want to go out to lunch or go out after work."

To create a new, leaner and more determined corporate culture, such a move could be necessary for its many operations, said Joe Schwieterman, director of the Chaddick Institute for Metropolitan Development at DePaul University.

"A smaller work force with top talent needs a downtown location," Schwieterman said. "Recruiting can be difficult for a 1960s-era corporate campus, like in Elk Grove. It's almost a throwback to a slower-paced aviation era when operations were different."

UAL's local operations Location Facility Employees O'Hare Airport 9,000 Elk Grove Township Operations 2,800 Chicago, Touhy Reservations 1,000 Chicago, Wacker Administration 650

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