Sub-Zero announced a $196.3 million expansion of its Cedar Rapids facility Tuesday, April 28, including the projected addition of 312 new jobs.
The project will serve as an expansion of the existing $140 million, 600,000-square-foot plant, which is set for a formal ribbon-cutting in late May.
A project timeline wasn’t released by Sub-Zero officials, but when completed, the facility, at 10015 Sixth St. SW, is expected to employ more than 500 workers.
According to a release, the project is expected to “enhance production capacity while further integrating advanced manufacturing technologies into the facility.”
$70 million of the expansion investment will pay for property development, while the other $120.3 million will pay for machinery and equipment.
Cedar Rapids economic development project coordinator Scott Mather told the Cedar Rapids City Council Tuesday that the expansion project should take about 24 months to construct, with work beginning in August and wrapping up by August 2028.
Mr. Mather also said that the expansion discussions began in February, when a confidential request for information was submitted to the city. A proposed financial incentive package was presented to the company in March, and earlier this month, the city learned it had been selected for the project, he said.
The council also voted to authorize sponsorship of a business financial assistance application for state incentives to support the expansion. The Iowa Economic Development Board will consider the application at its meeting May 15.
A formal development agreement will be presented to the council in June or July for consideration, Mr. Mather said.
Approximately 115 of the new employees will be hired at a wage above the Iowa Business Incentives for Growth (BIG) program’s rate of $30.41 per hour.
The city incentives for the expansion will provide a 10-year 100% tax exemption, which is available through the BIG program. The project is estimated to generate $13 million in new taxes over the 10-year period, with $7 million being exempted. The abatement is subject to maintaining employment thresholds.
As expected, city council members reacted enthusiastically to the project at Tuesday’s meeting.
“This is really an attestation to how great the city team has been to work with,” council member Ashley Vanorny said. “What’s happening in this area, there are so many family-owned companies, one has talked to another, has talked to another, and they’ve affirmed this is the place you want to do business with. These are great people. They are shovel ready. They know what they’re talking about … It’s not just getting this expansion, it’s attracting a generally family-owned business [Sub-Zero] that took a chance on Iowa.”
She also noted that the project is important for Eastern Iowa, which has lost several manufacturing jobs recently, including several hundred workers at Whirlpool’s Amana plant.
“This helps to retain those Iowans and that talent, those manufacturing jobs that we’ve lost,” she said.
Mayor Tiffany O’Donnell said the announcement is a “tribute” to city leaders’ efforts to draw new businesses and industries.
“When Sub-Zero first came here, they said they felt like they were at home,” she said, noting that the Wisconsin-based company has expanded to only one other state, Arizona, in addition to Iowa.
“They align very well with our advanced manufacturing identity here,” she said. “And Cedar Rapids, you’re a really easy city to sell … We’re doubling a facility and employment before it’s even officially opened its doors. That’s a win.”
Other Cedar Rapids leaders also hailed the planned expansion in a news release.
“Sub-Zero’s decision to expand here speaks volumes about the partnerships we’ve built and our ability to support long-term industrial growth,” city manager Jeff Pomeranz said. “This kind of investment not only creates jobs but also strengthens our broader economic ecosystem – from suppliers to workforce development.”
“This is exactly the type of project we work to attract and retain,” added Cedar Rapids Metro Economic Alliance CEO Juliet Abdel. “Sub-Zero is a world-class manufacturer, and their expansion signals that Cedar Rapids can compete for advanced manufacturing investment. The job creation and capital investment will have a lasting impact on our region.”
“Projects like this highlight the importance of having shovel-ready sites and infrastructure in place,” added Cedar Rapids economic development director Mike Lukan. “We’re seeing sustained demand for industrial space, and Sub-Zero’s expansion reinforces that Cedar Rapids is well-positioned to support large-scale manufacturing operations.”
Headquartered in Madison, Sub-Zero manufactures premium kitchen appliances under the Sub-Zero, Wolf and Cove brands.
At a groundbreaking ceremony for the company’s Cedar Rapids facility in September 2023, leaders from both the Cedar Rapids area and Sub-Zero celebrate the company’s choosing to locate in Cedar Rapids, citing strong economic incentives and a favorable support system from local businesses for swaying Sub-Zero officials’ decision to choose Cedar Rapids from an initial field of 900 potential sites.
“One of the (tenets) we kept coming back to is, if we were doing this job, if we were running this plant and we were working in a factory, where would we want to live?” Scott Wareing, senior vice president of operations and design for Sub-Zero, said about the company’s original decision. “Cedar Rapids was easily the first choice. We’re here because of the manufacturing base and capability and talent. We’re here because it’s a great place to be and live and work. And we’re here because of the partnerships that you all put together to talk to us and help us make this decision.”
