FirstEnergy to move out of downtown Akron, consolidate corporate offices in West Akron

FirstEnergy Corp. is relocating its headquarters from downtown Akron to White Pond Drive as part of an office consolidation plan.

Jennifer Young, FirstEnergy's manager of corporate communications, said Wednesday that FirstEnergy is developing plans to transition from four corporate buildings in Ohio, Pennsylvania and New Jersey.

FirstEnergy layoffs: FirstEnergy cutting 90 employees, 670 eligible for early retirement

According to Young, FirstEnergy's corporate headquarters will remain in Akron, moving to its West Akron campus on White Pond Drive.

For the past year, FirstEnergy has been exploring real estate options and relocation opportunities as the company re-evaluates the post-COVID workplace, Young said.

"As we made our transition to a more flexible way of working, it became clear that having a large, mobile workforce — those that do not need to report to an office to do their jobs and primarily work from home — provided the company an opportunity to reevaluate office space needs," Young said.

The company will continue to explore real estate options and relocation opportunities for its other corporate facilities, Young said.

Young said that of the approximately 925 employees who report to FirstEnergy's Akron downtown office facility, 90% are now designated as mobile.

The news comes as the utility announced Wednesday it's cutting about 90 employees companywide, with another approximately 670 employees eligible for a voluntary retirement.

In 2019, the company signed a 10-year lease extension with McKinley, Inc. for its downtown headquarters that would keep the company in Akron until at least June of 2035.

According to Young, FirstEnergy exercised its option under the lease to purchase the building.

"This step will allow FirstEnergy to end its long-term lease, providing the flexibility to implement the company’s facilities optimization plan and move employees to other reporting locations in the area," Young said.

Akron Mayor Dan Horrigan issued a statement late Wednesday afternoon saying the city "remains committed to working with our partners at FirstEnergy to spur future growth here in our community."

"FirstEnergy has been headquartered in Akron since they were formed and they have long been a vital part of both downtown Akron and the greater Akron region's success," he said. "I am pleased they will continue to have a strong presence in Akron. While downtown Akron will surely be impacted by their absence, I remain optimistic for the future of the building and for our downtown corridor.”

What will happen with the FirstEnergy building in downtown Akron?

Young said FirstEnergy and McKinley are in negotiations over the sale, and it's too early to say what FirstEnergy will do with the building once the company owns it. The sale price has not yet been determined.

Because the downtown complex hosts other tenants, the only portion the utility is buying is the tower housing FirstEnergy.

The move from the downtown building to the White Pond facility might take several years, Young said.

"We don't have an exact timeline for that," she said. "Employees can continue to report there as we work through this process."

Young said it's too early to say where employees might end up from the other three buildings outside of Akron that FirstEnergy is vacating.

"We're working through that process to identify where our real estate options are," Young said. "Knowing many of those areas, we have other nearby facilities that could be an option. We may choose to lease a smaller facility."

Blow to downtown Akron

FirstEnergy’s move is a blow to downtown, said Steve Millard, president and chief executive of the Greater Akron Chamber.

Millard said though he was initially disappointed when he heard about FirstEnergy’s plans, he was encouraged by the fact that the company wants to buy the building instead of just walking away from its lease.

“I'm really glad they will continue to be headquartered here in Akron,” Millard said of the move to West Akron.

Millard said the chamber has been included in talks with FirstEnergy officials about the move.

“The fact that the main tower is something that's not going to be a FirstEnergy tower long-term hurts us downtown a little bit, but they’re now going to be the owner of the building," he said. "So in some ways that gives them the ability to work closely with us and others as we re-envision our downtown and how we adapt.

“How can that space be used differently for our downtown? It's a much better position (than) to be to just surprised that they're gone."

The FirstEnergy building is not the only building on that end of South Main Street that is for sale. The former FirstMerit and now Huntington tower – Akron's tallest building – has been for sale since 2019. Huntington continues to use the building while it seeks a buyer.

More: Huntington Tower for sale

Millard said having FirstEnergy own the building gives it more control over its future.

“By taking control of the building and exercising that option (to buy), I think that economically gives them more of a chance to make the moves they need to make faster,” said Millard. “They can offer things in the building more quickly. In some ways, that's a good thing because they are now invested in the future of the building and what happens with it versus just terminating a lease and walking away.”

Millard said the chamber and city and other organizations are working on re-imagining downtown Akron as many employees are not returning to downtown post-pandemic.

“Not having (FirstEnergy) as an anchor tenant in our downtown, it's not good,” he said. “There could be lots of other things that we think about for that building and for that area. That's a quarter of our downtown that we want to see do better. So we'll work with others to figure that out.”

More: GOJO, Akron-based maker of Purell, is up for sale, Wall Street Journal reports

Recent upheaval for FirstEnergy

FirstEnergy has been going through a tumultuous period tied to the company's involvement in the House Bill 6 bribery scandal. The public corruption case led to the conviction this year of former Ohio House Speaker Larry Householder and ex-Ohio Republican Party Chair Matt Borges.

The scandal involved $61 million in bribe money paid by FirstEnergy via dark money groups to help Householder seize political power and, in turn, pass and defend the $1.3 billion H.B, 6 bailout law.

FirstEnergy Corp. fired Chuck Jones as its chief executive officer and named a replacement shortly after two men pleaded guilty in the $61 million Larry Householder bribery investigation.

In March, FirstEnergy named Brian Tierney as its new CEO, succeeding interim President and CEO John Somerhalder II.

Tierney previously served as senior managing director and global head of infrastructure operations and asset management at asset management firm Blackstone, where he started working in 2021.

Blackstone became one of FirstEnergy's largest shareholders in late 2021, when the investment firm acquired $1 billion worth of the utility company's stock. The deal also gave Blackstone a seat on the FirstEnergy board.

Contact reporter Derek Kreider at DKreider@Gannett.com and Betty Lin-Fisher at blinfisher@thebeaconjournal.com

This article originally appeared on Akron Beacon Journal: FirstEnergy to leave downtown Akron, move headquarters to West Akron