Boston makes GE’s short list for new headquarters
General Electric Co. is looking at sites in the Seaport District for a new global headquarters that could bring hundreds of high-paying jobs and give a civic boost to a city that has seen many of its corporate stalwarts swallowed up by out-of-town buyers.
The Boston area is on a short list of potential locations for the conglomerate — known for making everything from train engines to MRI machines — along with candidates including New York and Providence, according to people familiar with GE's search.
Governor Charlie Baker and Mayor Martin J. Walsh have been involved in the talks, the people said.
GE, based in Fairfield, Conn., would initially move roughly 500 jobs to the new location; it is unclear how many of those jobs would be filled by current employees who move with the company.
GE has been looking at a number of local sites, particularly in the waterfront section of South Boston. The company, is considering buying, leasing, or building a new facility, according to the sources, and could decide by year's end.
"We're very much in the game," a person close to the process said of Boston's prospects to be GE's new home.
Various states have been jockeying for GE's affections since chief executive Jeffrey Immelt announced in June that the company was going to look at options for headquarters outside of Connecticut. The company, which reported nearly $150 billion in revenue last year, has not ruled out staying in Fairfield, and a GE spokesman declined to comment on specifics about the search.
Massachusetts and Boston are not offering special tax breaks to lure GE beyond the incentives they normally offer companies, such as property tax relief and tax credits, people close to the process said.
Representatives of Baker and Walsh declined to comment.
Boston-area officials and their representatives have been aggressively pitching the idea that the city's strength in innovation fits into Immelt's new vision for GE — a company whose roots can be traced to Thomas Edison and his invention of the incandescent light bulb more than a century ago.
Immelt wants people to think of GE as a high-tech firm, not just an old-school industrial manufacturer.
That would play to Greater Boston's reputation as a research and development hub for health care and technology, as well as a place where GE could easily recruit talent from the area's numerous colleges and universities.
"We are well positioned to win this one," said David Begelfer, chief executive of NAIOP Massachusetts, a commercial real estate trade group.
GE began looking to move out of Connecticut, where its headquarters office has been since the mid-1970s, after state legislators threatened to raise corporate taxes.
Immelt, in a widely cited letter to employees in June, said he had assembled a team to look into the company's options "to relocate corporate HQ to another state with a more pro-business environment."
Representatives for the company have kept tight-lipped about the finalists in the search. But Immelt has been frank about the reasons for looking outside of Connecticut.
"We're a company that . . . doesn't look for special deals, but we need an ecosystem that's forward-looking, that's future-looking," he told the Business Council of Fairfield County last month, as reported by the Stamford Advocate.
New York has reportedly dangled a generous offer to entice the company. A spokesman for the city could not be reached for comment. Less clear is what Rhode Island could provide; an official there declined to comment.
In Massachusetts, municipalities can offer property tax breaks on construction worth millions of dollars in return for the promise of new jobs. And there are several tax-credit programs and grants for infrastructure work at the state level. Recent beneficiaries include IBM's Watson Health division, awarded $2.5 million by the state to open a headquarters in Cambridge, and Amazon.com, which received a $3.25 million package for a new warehouse in Fall River.
Landing GE's headquarters would be a coup for the region, where many marquee companies, Gillette to John Hancock, have been acquired by out-of-state competitors, while the acquisition of EMC Corp. is pending.
Connecticut in June put in place tax changes that would raise costs for companies like GE, prompting Immelt to look for a new home.
But Governor Dannel Malloy, a Democrat, and the Legislature approved a budget bill during a special session this week that rolled back some of the changes that had alarmed companies in the state.
Yet a Connecticut state representative, John Frey, said GE executives are worried that Connecticut's budget is structurally out of balance and that taxes could rise in the future.
And because the company would be moving only its corporate offices and not any manufacturing facilities, it would not be a complicated move, Frey said.
"We would hate to see them go, [but] it's completely explainable why they would be going," said state Senator Scott Frantz, another Fairfield County legislator, who added that he puts the odds at "better than 50-50" that GE will move.
GE already has a large presence in Massachusetts, with thousands of employees here.
The company's most notable local ties include its manufacturing operations in Lynn, where it makes jet engines. GE has pared back its blue-collar workforce here over the years, most recently with the decision to close a valve factory in Avon next year, a move that will eliminate some 300 jobs.
But it has also been expanding certain business lines. Over the summer, GE Healthcare Life Sciences started relocating its US headquarters from New Jersey to Marlborough. And the company said in October that it would base a new division, focused on lighting and energy, in a to-be-announced location in the Boston area.
"GE is not a stranger here in Massachusetts," said Susan Houston, executive director of MassEcon, a Watertown-based organization that helps recruit businesses into the state. "That is to our advantage."