GE Considers Westchester, But Winds Up Moving HQ to Boston

John Jordan | January 14, 2016

GE CEO Jeff Immelt


BOSTON—Although most likely a long shot, Westchester County officials were still disappointed when they learned that General Electric would not move its headquarters from Fairfield County across the New York State border to Westchester.

GE officials reported on Jan. 13 that it would relocate its corporate headquarters from Fairfield, CT to Boston, MA. Perhaps hoping for payback for the Starwood Hotel and Resorts Worldwide’s relocation from White Plains to Stamford in 2009, Westchester County was reportedly in the running for the sought after General Electric corporate headquarters.

General Electric, as well as Boston Mayor Martin Walsh and Massachusetts Gov. Charlie Baker, confirmed the headquarters relocation to Boston’s Seaport District. The package of incentives to land General Electric totals more than $151 million, including $120 million in grants and incentives from the Commonwealth of Massachusetts and $25 million in property tax relief from the City of Boston.

Westchester County Executive Robert Astorino released a statement in response to GE’s decision. He said, “We are disappointed because we think Westchester can compete with anywhere in terms of talent, location and quality of life. But the move to Massachusetts does bring up questions about New York State’s competitiveness. There are reasons why New York constantly ranks at the bottom or dead last in terms of business climate. Those reasons matter to businesses, as General Electric’s CEO Jeffrey Immelt made clear, and this decision reflects that.

To finance the move to that as yet unspecified address in the Seaport, GE stated that it will sell its offices in Fairfield, CT and its offices at the iconic 30 Rockefeller Plaza in New York City. The office holdings at 30 Rock involve two floors the company maintains for executives. The company sold additional floors it owned to Comcast in 2013 when it sold NBC Universal to the firm.

Employees will move to a temporary location in Boston starting in the summer of 2016, with a full move completed in several phases by 2018.

GE’s new Seaport headquarters will have approximately 800 people; 200 from corporate staff and 600 digital industrial product managers, designers and developers split between GE Digital, Current, robotics and Life Sciences at the Seaport District offices. A GE Digital Foundry will be created for co-creation, incubation and product development with customers, startups and partners.

“GE aspires to be the most competitive company in the world,” said GE Chairman and CEO Immelt. “Today, GE is a $130-billion high-tech global industrial company, one that is leading the digital transformation of industry. We want to be at the center of an ecosystem that shares our aspirations. Greater Boston is home to 55 colleges and universities. Massachusetts spends more on research and development than any other region in the world, and Boston attracts a diverse, technologically fluent workforce focused on solving challenges for the world. We are excited to bring our headquarters to this dynamic and creative city.”

GE began its headquarters search in June 2015 with a list of 40 potential locations. Boston was selected after a careful evaluation of the business ecosystem, talent, long-term costs, quality of life for employees, connections with the world and proximity to other important company assets, the company states. The headquarters study was in response to the passage of in excess of $1 billion in tax increases imposed by the State of Connecticut last year to close a budget gap.

The company employs approximately 5,000 workers in Massachusetts. In 2014, GE moved its Life Sciences headquarters to Marlborough, and in 2015 GE announced its energy services start-up, Current, would also be headquartered in Boston.

The decision by GE to relocate its headquarters to Boston is a significant victory for both Mayor Walsh and Gov. Baker who lobbied hard to secure the deal and bested proposals by a host of other states including New York, Rhode Island, Texas and Georgia who reportedly vied for the GE headquarters deal.

Connecticut Governor Dannel Malloy
Connecticut Governor Dannel Malloy

Licking his wounds, Connecticut Gov. Dannel Malloy released a statement that notes that GE’s decision to leave the Nutmeg State should serve as a sign that the state should adapt to a changing business climate.

Malloy says that one of businesses concerns is “how states budget, and now is the time to continue our bipartisan efforts to reform our budget, find new ways to pay our pensions, and create a more sustainable and predictable state budget.”

He adds, “Taken as a whole, there is no denying that Connecticut has had more good days than days like today. Of course we are disappointed, and we know that many in Connecticut share that frustration. While GE’s headquarters may be leaving, I have been assured that the company will continue to have many employees working here in Connecticut. Equally important, GE will continue to work with and support many smaller businesses throughout our state.”

Photo Caption:
GE CEO Jeff Immelt began the headquarters search in response to escalating taxes in Connecticut.

John Jordan
Editor, Real Estate In-Depth