GE picks Fort Point site for headquarters
The headquarters complex where General Electric will plot its shift from industrial conglomerate to modern-day technology company will be a blend of new buildings and old, with a view of downtown skyscrapers and an address that brings creative-industry cachet. It’s even on the water.
GE on Thursday said that it has reached a deal with Procter & Gamble to buy a roughly 2.5-acre piece of Gillette’s South Boston campus along Fort Point Channel, near the Summer Street Bridge and a short walk from South Station.
There, the company plans to rehab two empty brick warehouses — relics of the industrial waterfront — and construct a new building on a portion of an adjacent parking lot. There will be a large sign visible from downtown and public space that will showcase GE’s storied history. The location is firmly in Fort Point, a funky neighborhood full of smaller tech and creative firms that GE wants to tap as it transforms its business.
“We loved being on the water overlooking Boston. We loved the warehouses and the industrial feel of it,” said Ann Klee, a GE vice president who’s heading up the move. “It hit all of the buttons for us.”
The location has a long history. The two six-story brick buildings, on Necco Court, are part of a complex that once housed New England Confectionery Co. The buildings and parking lot have long been owned by Gillette, and now by its corporate parent, Procter & Gamble, as part of the 44-acre campus of Gillette’s World Shaving Headquarters. Much of the parking lot will remain in P&G’s hands.
Gillette, according to real estate brokers, had long rebuffed offers for the property, a prime piece of developable land a stone’s throw from downtown. But the opportunity to be a neighbor of one of the country’s largest and most storied conglomerates was too good to turn down, said Gillette’s president, Charlie Pierce.
“When GE contacted us, we saw an opportunity to welcome a world-class innovation leader into our neighborhood, benefiting the local community, enhancing the Seaport District and generating value for our shareholders,” Pierce said in a statement.
Financial terms of the deal were not available Thursday. A P&G spokeswoman said she expects the sale to close in nine to 12 months. GE wants to move into the complex in 2018, from temporary offices it has leased nearby on Farnsworth Street.
In all, about 800 people will work in the buildings, including 200 relocated from GE’s current headquarters in Connecticut, and the rest to be hired locally for software and research jobs.
GE will join other big-name employers in the neighborhood including Vertex Pharmaceuticals, PricewaterhouseCoopers, and State Street Corp.
GE has not filed development plans with the city and is still hiring an architect. In Boston Thursday, chief executive Jeffrey Immelt said he expects the company will spend $80 million to $100 million on the headquarters, between land and construction. Still to be determined is the amount of public aid GE will receive to develop the property.
To help woo GE’ from suburban Fairfield Conn., Governor Charlie Baker and Mayor Martin J. Walsh offered a package worth up to $145 million in tax breaks and infrastructure funding, much of it tied to GE’s real estate needs. Now that GE has real estate lined up, the numbers can be finalized, said John Barros, Boston’s economic development chief.
“We’re excited to work with them,” Barros said. “As we learn more about the total program we will know how to apply those incentives.”
GE’s plan, Klee said, is to construct the new building itself, and rehabilitate the two older buildings in partnership with the Boston Redevelopment Authority. She said the BRA would own the buildings and lease them to GE.
That would make them eligible for state incentives that cannot be used on privately owned real estate. It could also mean GE can occupy the buildings rent-free for up to 20 years, though the company would have to pay other costs. Barros said no agreements have been reached yet.
GE plans to unveil more of its vision April 4, when it holds a reception with local business leaders and elected officials.
The new building, Klee said, will be of modest height, in keeping with zoning that restricts buildings to 180 feet. It will include open space along the water and public exhibit space on the ground floor. There may be an elevated walkway connecting the buildings. The company won’t replace the parking spaces lost to the new building; Klee said GE wants employees to use public transit.
Matthew Kiefer, a veteran development attorney, said the location makes great sense for GE. “They want to be part of the innovation culture of the city. Here they’ll be in the middle of it,” Kiefer said. “They’re combining new construction and historic rehab. The more obvious thing would’ve been to go for a more high-profile site. It’s really clever that they’ve chosen this.”
And it puts GE exactly where it says it wants to be.
Even before announcing the move to Boston in January, the company had zeroed in on the Seaport, with Klee and others taking in the bustling neighborhood from a high perch in the Federal Reserve Bank’s tower, across the channel.
Then, in searching for a building, GE executives quickly ruled out the glassy towers planned along Seaport Boulevard as too corporate, according to people involved in the search. And they eschewed state-owned parcels farther from downtown as too removed from the action.
But the chance to both build new and be among old bricks, in the heart of a neighborhood that buzzes with brainy competition? After decades in suburban Connecticut, that’s exactly what GE wanted, Immelt told the Boston College Chief Executives Club Thursday.
He predicted the site would make GE a better company.
“I want [employees] to walk out of our office every day and be terrified,” Immelt said. “I want to be in the sea of ideas so paranoia reigns supreme. To look out the window and see deer running across? I don’t care about [that].”