On Tuesday, Reuters reported that Northwestern Mutual Life Insurance is exploring the sale of Russell Investments, which moved from Tacoma to downtown Seattle during the recession, helping to fill the crater left by the implosion of Washington Mutual.
Northwestern is “discussing selling the Russell subsidiary because it has decided it is not a core part of its business,” according to four sources. The company declined to comment. “If the firm decides to go ahead with a sale, it is unclear if the business would be sold in its entirety or broken up, two of the sources said.”
I’m inclined to take it seriously, and the sale could be bad news for Seattle if a new owner decided to move Russell to a major financial center such as San Francisco or New York.
The move to Seattle has already proved highly profitable for the Milwaukee-based insurer.
Northwestern Mutual sold the 42-story tower to CommonWealth Partners in 2012 for $480 million, in what was said to be the single largest deal for a Western office building since 2006. It acquired the former WaMu headquarters in 2009 from JPMorgan Chase for $115 million. It was renamed the Russell Investments Center.
Russell has $287 billion in assets under management and runs the Russell indices. But, according to the story, the unit was badly mauled by the financial meltdown, including the exposure of its money market funds to the collapse of Lehman Bros.
Northwestern Mutual bought the former Frank Russell Co., a pillar of the Tacoma business community, in 1999. In 2009, Russell moved to Seattle with about 900 employees.
If a sale happens and Russell is in danger of moving, new Mayor Ed Murray has his first economic crisis.
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Today’s Econ Haiku:
Fines are a business expense
No one went to jail