The bromance between Governor Charlie Baker and Boston Mayor Martin J. Walsh was on full display that evening in September when General Electric’s headquarters search committee made its first visit to Boston.
With the group’s plane delayed, the politicians enjoyed rare downtime on a balmy evening, shaking hands and taking selfies before a VIP dinner at the Tresca restaurant on Hanover Street in the North End.
When the GE executives arrived, the governor and mayor were relaxed and ready as the warm-up act. Walsh spoke, then Baker, each for about 10 minutes. Turning up the charm, the two demonstrated an uncommon rapport between a Democrat and Republican.
“There wasn’t an inch between them in both wanting GE to come,” recalled Dan O’Connell, president of the business group Massachusetts Competitive Partnership, and one of the dinner guests.
But where exactly did they want GE to find a home? State Economic Development Secretary Jay Ash, who organized the dinner, was eager to showcase cities around Massachusetts, from Weymouth to Worcester. But the mayor was there because he wanted the industrial conglomerate to fall in love with his city.
How Boston wooed and won one of the world’s most famous companies is a case study in two young administrations knocking heads and then coming together when it counted the most. Ultimately, the strong relationship between Baker and Walsh played a critical role in the seven-month courtship of GE.
Senior staffers worked closely, though not without frustrating moments, to persuade the company to relocate its headquarters and 800 employees to the Seaport District. Along the way, other leaders and local CEOs got involved, from former governor Bill Weld to New England Patriots owner Bob Kraft.
The world learned Wednesday that Boston beat out some 40 competitors. Chief executive Jeff Immelt trumpeted the region’s concentration of innovative companies, elite universities, and educated workforce as a place for his century-old firm to transform itself in a digital age.
But that wasn’t all that mattered. The state’s financial stability, quality of life, and ease of travel factored into where GE would relocate hundreds of its most senior employees from suburban Fairfield, Conn.
“It was the total package,” said Ann Klee, head of GE’s site selection committee. “When we looked at our subjective and objective criteria, Boston was a great fit.”
Connecticut tax increase
If there was a last straw, this was it: Connecticut lawmakers in June proposed to raise taxes by $1.9 billion, more than a third from businesses.
GE’s home office had been in Fairfield for more than four decades, but Immelt wanted out. It’s something the company has been considering for more than three years as budget woes dogged Connecticut. This time, Immelt formed a committee to explore options, telling employees in a memo he wanted to relocate GE headquarters to a state with a “more probusiness environment.”
Immelt’s decision was all over TV that day, catching the eye of Mayor Walsh sitting in his fifth-floor office in City Hall. He picked up the phone to call John Barros, the city’s economic czar.
“Are you hearing this?” the mayor asked.
‘It took us a while for us to come together. We were never at odds, but we weren’t playing off of our best strengths.’Jay Ash, state economic development secretary
Walsh saw opportunity and dispatched Barros to start cold-calling not only GE, but also another half dozen Connecticut companies that might be unhappy with paying more taxes.
But the mayor also knew someone inside GE: Jim McGaugh.
McGaugh had been an aide to Tom Finneran back when Finneran was speaker of the House two decades ago. The mayor, himself a former state representative from Dorchester, called McGaugh to tell him Boston wanted to be a contender.
Turns out McGaugh, who is a government affairs manager for GE, had started to get the word out that his company was serious about moving. He had even pressed Finneran to talk to city and state officials.
“Tommy, we are not window shopping,” McGaugh told him, according to Finneran.
Differences on location
Barros and Walsh wanted GE to come to Boston, while Ash seemed more interested in spreading the wealth around the state, according to people involved in the process. High on the Baker administration’s economic agenda was lifting gateway cities like Lawrence and Lynn, something the governor had campaigned on.
In late July, Ash took a team of Massachusetts officials to GE’s headquarters to make a pitch. No one from the city of Boston went along.
The rivalry among communities didn’t matter. The eight-member GE search committee liked Massachusetts enough to make it one of a handful of regions it would visit. The area’s research universities, flourishing tech and life sciences sectors, and an ecosystem to support business made Boston a must-see.
The two-day visit in September started with the two-hour dinner at Tresca, attended by a couple dozen local business leaders and economic officials. Ash acted as emcee, and other speakers that night included University of Massachusetts president Marty Meehan; Rick Lord, the president of the Associated Industries of Massachusetts; and Scott Bailey, the managing director of the startup accelerator MassChallenge Boston.
The next day, Ash organized a full-day bus tour of potential headquarters sites, visiting several neighborhoods in Boston, as well as Cambridge, Somerville, Waltham, and Weymouth, among others.
Barros, who oversaw the Boston portion of the trip, got good vibes.
“By the time we were done with the tour, it was clear GE was interested in Boston,” he recalled.
It would be the first of several visits by committee members. One thing did come into focus quickly: If GE relocated to Massachusetts, it wanted to be in the city of Boston. The group had looked at properties across the city, including in the Fenway, Dudley Square, and the Financial District, but by October, it set its sights on the Seaport District.
What caught their eye? On one visit, committee members went up some 30 stories to the top of the Federal Reserve Bank building, where they were able to peer down and see the bustle of cranes, brick warehouse buildings, and gleaming towers, all set along the waterfront.
When they got on the ground and walked over the Summer Street bridge, they sensed the vibrancy of an emerging district with people flowing from South Station into the Fort Point Channel neighborhood.
“It felt like exactly the place we wanted to be,” recalled Klee, the search committee head.
Barros, along with Walsh’s chief of staff Dan Koh, pulled together a 16-member team from various city departments ranging from the Boston Redevelopment Authority to the assessor’s office.
The city’s chief financial officer, David Sweeney, was also brought in to see how Boston could sweeten the pot. The city didn’t have much to play with except to offer property tax breaks. The big package would have to come from the state.
City officials soon grew frustrated with Ash and his team. The city believed Boston was shaping up to be on GE’s short list, but the state didn’t seem to share the same sense of urgency. Perhaps the Walsh administration felt more pressure for a win after losing the bid for the Summer Olympics.
State involvement needed
By early November, GE was asking more detailed questions. The company wanted to make a decision about its headquarters by the end of the year. At this point, city officials felt Boston could not win without more state involvement. Where, for example, was Baker’s chief of staff, Steven Kadish?
Putting Kadish on an assignment signals that it’s a high priority for the governor. When the MBTA was in shambles last winter, Kadish was the point man on getting the system back on track. When the Department of Children and Families was in crisis, the governor dispatched Kadish to straighten out the mess.
But instead of focusing on a GE proposal, Kadish was working on improving the Registry of Motor Vehicles.
That all changed right before Thanksgiving. It’s hard to get a straight answer on what lit a fire under everyone. Perhaps it was a looming deadline. Or maybe it was GE’s increasingly rigorous process as the committee edged closer to a decision.
Baker’s chief of staff got the nod.
“The governor said, ‘Let’s go,’ ” Kadish explained. “It just became clear we had a shot.”
For his part, Ash acknowledged the city and state hit some rough patches. Both administrations are relatively young, and everyone is fairly new to their roles.
“It took a while for us to come together,” said Ash. “We were never at odds, but we weren’t playing off of our best strengths.”
Calling in reinforcements
Kadish brought in reinforcements, including budget czar Kristen Lepore and Massachusetts Port Authority chief Tom Glynn. As Kadish stepped up, Koh became even more involved, and together with Ash and Barros, they formed the backbone of a new joint team.
Around the same time, GE hired ML Strategies, the lobbying and consulting arm of law firm Mintz Levin, in a sign that the conglomerate was getting more serious about Boston. Mintz, headed by Bob Popeo, has served as one of GE’s outside counsels for more than four decades. GE brought in ML to help negotiate a package.
In signing ML, GE got an all-star roster including president Steve Tocco, a former state secretary of economic development and Massport chief; Mo Cowan, a former US senator and chief of staff to Governor Deval Patrick; and Weld, the former governor.
Bringing in Massport, which is a major landowner in the Seaport District, went a long way for the Boston team to offer an attractive package because officials have control over lease terms and have more flexibility in obtaining permits than would be the case with private property.
By mid-December, the group sensed that Boston had become a finalist along with New York and Providence, but Connecticut couldn’t be ruled out. It was too easy for GE to decide to just stay put.
But even with Massport land, city and state officials were worried that competitors were offering lucrative incentives they could not match. So what local officials didn’t have in actual capital, they decided to make up in political capital.
Daily conference calls between the city, state, and GE morphed into several calls a day. City and state teams put up a united front. They collaborated on a glossy pitch book. Another time, a dozen of them — including Kadish, Ash, Barros, and Koh — crowded around a speakerphone in City Hall on a call to GE just to show how closely they were working together.
As the city and state worked to lure GE, word had been put out to local business leaders to do something, say something, if they knew Immelt. EMC Corp. chief executive Joe Tucci buttonholed Immelt in Washington at a September meeting of the Business Roundtable, an exclusive CEO group.
Bob Kraft of the New England Patriots, who considers Immelt a longtime friend, gave him the hard sell as he sat in the owner’s box when the Washington Redskins played at Gillette Stadium in November.
And just before Christmas, State Street CEO Jay Hooley, whose company has worked with GE for years, was in Fairfield for a regularly scheduled meeting with Immelt and GE chief financial officer Jeff Bornstein.
Hooley knew about efforts to get GE to Boston and figured he would bring it up. He didn’t need to. Immelt and Bornstein spent the first half hour peppering Hooley with questions. What was the governor like? What about Walsh? What is it like to do business in Boston? Why should GE move there?
“The first part of the meeting was hijacked by them,” recalled Hooley.
Hooley also wanted to get a better sense of what was important to Immelt. Looking out the window of his suburban office, the GE chief couldn’t have been more clear-eyed about the company’s new home.
“He wants to be able to walk out of the building and be connected,” Hooley said. “He wants to be put in the flow of information and ideas.”
City and state officials worked feverishly up until Christmas and after with frequent contact with GE executives. On Jan. 8, a formal proposal to relocate the GE headquarters to Boston was drawn up with three signature lines — for Walsh, Baker, and Immelt. An exact site would be worked out later.
Then everyone waited.
By Tuesday, rumors were flying around town that New York was out, and GE was Boston bound. Klee, the head of the search committee, scheduled another conference call with the city and state team Wednesday morning. Was it just another meeting or the decision?
At around 10 a.m., Baker got a call from Bornstein, GE’s chief financial officer. Walsh heard from Klee.
Later that day, Bornstein reached out to Hooley, telling him: “In the last 45 days, the mayor and governor really brought this thing home.”