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After the flood: We Energies employees start returning to HQ after $62M in repairs

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The first employees returned this month to We Energies historic downtown Milwaukee offices more than 18 months after flooding in the historic building's steam system caused damage that led to over $60 million in repairs.

Only a handful of employees are on site so far, said spokesman Brendan Conway. However, about 400 will start on a hybrid work schedule Jan. 10, 2022, said Scott Lauber, chief operating officer of We Energies parent company WEC Energy Group (NYSE: WEC).

Crews are in the final stages of setting up furniture and cubicles and connecting computer monitors and docking stations. The project should be completed by Christmas, Lauber said. See the attached slideshow showing extensively repaired building.

The building at 231 W. Michigan St. was hit by a superheated steam release during a storm in May 2020. The disaster could have been worse as most employees already were working remotely because of the pandemic and the event happened on a weekend, Lauber said.

The flooding knocked out steam service to buildings on the entire east side of downtown Milwaukee and some buildings west of the Milwaukee River.

A security guard noticed something was awry in the We Energies basement when making his rounds, exited the area and reported the information to company managers, said Marisa Dempsey, facilities design and construction program manager at WEC Energy Group.

Temperatures in the underground steam-power tunnel reached 400 degrees and flooded the basement with water that was several feet deep, Dempsey said. PVC pipe in the basement that’s normally straight was warped from the intense heat that had to be over 200 degrees to cause such melting, she said.

Steam spread through the building with major concentrations on the fourth-floor executive offices because steam rises, Lauber said.

“Water was dripping from the light fixtures,” he said. “The ceiling tiles were falling down. It was a tremendous destruction throughout the building because steam goes everywhere.”

While 18 months seems like a lengthy duration for a repair project, Lauber said it was a relatively rapid turnaround. The company was able to arrange for contractors and the contractors were able to order materials before the worst of the pandemic supply-chain challenges started, he said.

Also because the building was vacant, contractor crews were able to perform multiple tasks simultaneously. If not for the availability of contractors and supplies, the project could have taken another year, Lauber said.

Ornate plaster work and woodwork didn’t need to be replaced and water damage to flat surfaces typically was easy to repair and repaint, Dempsey said.

The general contractor was J.H. Findorff & Son, and other firms handling major portions of work included Staff Electric and J.M. Brennan Inc., Dempsey said. EUA of Milwaukee was the architect.

“We called on our partners in our time of need and they came through for us,” Dempsey said.

As the Business Journal reported in January, the estimated project cost climbed to $60 million from initial estimates of about $10 million. Ultimately, the Public Service Commission of Wisconsin approved a budget of $62.5 million.

The figure could have been $15 million to $20 million higher if We Energies’ contractors hadn’t beat the supply-chain upheaval and inflated prices. Also, the company saved about $11 million by deciding to replace damaged furniture and cubicles with used furniture from offices other WEC Energy Group companies closed in Green Bay and Chicago, Lauber said.

Lauber said he anticipates the project will be completed for $700,000 to $800,000 less than the $62.5 million budget. Also, the company continues discussions with its insurance company, which We Energies executives expect to cover a substantial portion of the cost.

Customers of WEC Energy utility companies will be required to pay the costs not covered by insurance, Lauber said.

The company took the opportunity to modernize all of its office space including more room for collaborative areas and much less space for storing paper and paper records. The interior was largely redesigned for today's workplace needs, Dempsey and Lauber said.

The project also included taking measures to avoid a repeat occurrence.

Marine-type barrier walls were installed to close an opening between the steam tunnel and the building, Lauber said. The company added pumping capabilities and additional internal alert systems, he said.

We Energies executives decided they would fix the historic building rather than demolish it, Lauber said. The structure opened in 1905 and originally was built for The Milwaukee Electric Railway and Light company, which is now We Energies.

“It’s a historical building for the city,” Lauber said. “So tearing it down just didn’t seem like the right answer. It was a disaster. Insurance can recover a lot, so we just proceeded.”

Restoration and design by EUA. 

Rich Kirchen
Milwaukee Business Journal

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