GE TO SELL FORT POINT PROPERTY
Company scraps HQ tower, will reimburse state $87M
General Electric said Thursday it will reimburse the state nearly $87.4 million for incentives it received to move its headquarters to Boston, as details emerged about the sale of the company’s Fort Point Channel property.
The company and MassDevelopment, a quasi-public agency, reached a deal to sell the property on Thursday, which includes two Necco Court brick buildings owned by the state and an adjacent parcel, owned by General Electric, where a 12-story office tower was planned.
“We are looking forward to moving into our permanent headquarters space in the refurbished Necco brick buildings later this year,” said Ann R. Klee, GE’s vice president for Boston development and operation, in a statement to the Herald. “While changes in the Company’s portfolio and operating model will lead to a smaller corporate headquarters, we are fully committed to Boston and proud to call it home.”
General Electric recently told the state that the office tower no longer fit the company’s needs, according to a memo from MassDevelopment to its board of directors. The company intends to remain in Fort Point, however, and will house its senior executive team and about 250 employees in the two rehabilitated Necco buildings.
In a sit-down with the Herald on Thursday, Boston Mayor Martin J. Walsh said GE’s headquarters in Boston still benefits the city, despite Thursday’s announcement.
“GE was kind of the first move out of Connecticut that was happening when companies were exiting or looking at exiting out of Connecticut. We reached out to GE and I think that we found we were able to attract GE to Boston along with the state,” said Walsh. “And we were able to do an incentive package that was if the expansion happened, $25 million on the city part and $150 million on the state part. It wasn’t tied to jobs, it was tied to buildings and expansion.”
“At the end of the day, two years later, they decided because of their own internal issues, they decided not to do the new building so we get the $25 million back, technically, but we never gave it away so that’s resolved,” Walsh told the Herald. “We also over the last two years have gotten $2 million in real estate property tax that we wouldn’t have gotten because one was an abandoned building, one was the site that was future development, so I think at the end of the day the city worked out OK on it.”
Lizzy Guyton, communications director for Gov. Charlie Baker, said the administration looks forward to General Electric’s “ongoing contribution to the growing innovation economy” and to “working with GE as the company grows its world headquarters here in Boston.”
The $87 million repayment will cover MassWorks grant funds used to finance MassDevelopment’s original purchase of the property, as well as the costs of rehabilitating the brick buildings. Any proceeds from the sale above the $87 million will be split equally between the state and General Electric.
“GE’s been around for over 100 years, I think they’re going to reinvent themselves in other ways,” Walsh said. “Went from the light bulb company to all other aspects, they’ll reinvent themselves. Having the fact that their corporate headquarters here in Boston, five years from now, GE could be back being the superpower of the business world … nothing lost there by us pursuing them here and what was the spinoff of that was a lot of other companies came into our area on it.”