Met subsidiary leases space in Spokane Valley

An insurance subsidiary of bankrupt Metropolitan Mortgage & Securities said Tuesday it has leased new office space in Spokane Valley.

Western United Assurance Co. officials said they’ll move from the high-rise Metropolitan Financial Center downtown into the second floor of a building that’s also occupied by tech company Key Tronic Corp.

The move is part of an effort by Western United to achieve financial separation from Metropolitan, which is facing regulatory investigations over its management of assets.

Metropolitan and a sister company, Summit Securities, filed for bankruptcy protection earlier this year.

Two other Metropolitan insurance subsidiaries, Old West Annuity & Life and Old Standard Life, will also move their operations into the new office.

The moves will occur in August, said Scott Cordell, Western United’s vice president.

All three subsidiaries are under state receivership to protect policyholders and company assets. The move to the new building was approved by Washington state’s Office of the Insurance Commissioner. Western United is required by law to be physically separate and operate independently from its troubled parent, said Cordell.

According to Bankruptcy Court documents, Metropolitan and Summit Securities have about $572 million in assets and $582 million in liabilities. The 17-story Metropolitan Financial Center downtown is for sale.

Western United will occupy about 48,000 square feet in the building at 4424 N. Sullivan Road.

“We are delighted to find a new location that will keep us in the Spokane area for the next five years and beyond,” said Western United President Dale Whitney in a prepared statement. “Western United remains a healthy and financially sound company.”

The three insurance companies will move a total of about 170 people to the new building, Cordell said. Some hiring is expected as the subsidiaries take on administrative and support jobs formerly performed by Metropolitan employees, said Cordell.

Since Metropolitan charged the insurance firms a fee for rent and for those services, the relocation will end up saving the companies money, Cordell said.

Western United will keep its Post Falls, Idaho, processing center, where it has 45 employees.

The company has more than 40,000 policyholders in 16 states.

Key Tronic was the original owner of the Sullivan Road building, which was constructed in the 1980s. It used both floors of the structure until it shifted a large portion of its manufacturing to Juarez, Mexico, said Key Tronic Vice President Ron Klawitter.

Four years ago, Key Tronic sold the building to Royal Hills Associates LLC, a Seattle property manager. The company now leases back the space it uses on the first floor.