Raymond James staff cut by a third
Morgan Keegan buyer down to 600; fate of Downtown tower is unclear
Morgan Keegan & Co.’s big workforce in Downtown Memphis has been cut by about a third in the 16 months since the buyout by Raymond James Financial Inc.
About 300 of the 900 jobs Raymond James inherited in the Morgan Keegan Tower are gone now, taking buying power out of the local economy and putting more pressure on a Downtown real estate market hit by losses of law firms and other tenants.
A top Raymond James executive on Friday confirmed the job cuts. This is the first time the Florida-based investment firm has publicly disclosed the extent of the job reductions.
When the buyout took place in early 2012, Raymond James chief executive officer Paul Reilly said a then-unknown amount of work would flow away from Memphis as positions were moved to St. Petersburg or eliminated. On Friday, Reilly responded to The Commercial Appeal’s query about the company’s size in Memphis and its future plans for the Downtown tower. In an e-mail, he said Raymond James employs about 600 in the 21-story brown tower on Front.
Reilly also pointed out that the company will consider real estate options and could stay in Downtown or move out once the lease expires in 2015 on its office space in the riverside skyscraper.
Leaving the tower could mark the third substantial loss in the Downtown office market. Bankrupt Pinnacle Airlines Corp. recently relocated to suburban Minne-
apolis, and the huge state office building is slated to empty out.
Asked about rumors the company intends to move more work out of Downtown, Reilly’s e-mail insisted Raymond James is going ahead with the plans described in 2012 to keep Memphis a key part of the company’s structure. Said the CEO’s message:
“Raymond James is committed to Memphis. The area anchors our fixed income and public finance businesses, is the home for some of our larger private client offices, and is now one of our primary operations hubs.
“After working through our right-sizing plans, we have already begun to add jobs and expect to grow our presence in Memphis in the coming years. At this point there are twoplus years remaining on the Raymond James Tower lease and we are exploring all real estate options in Memphis.”
Since the acquisition, Raymond James has either laid off employees, transferred them to East Memphis or moved them to the Florida headquarters.
Paul Morris, president of the Downtown Memphis Commission, said the Raymond James layoffs have occurred “fairly regularly” over the past two years.
When the Raymond James lease is up, Morris said, “like any tenant, they would look around. We’ll do everything we can. They are a very critical and important part of the Downtown employment base.”
Morgan Keegan, an investment firm founded in Memphis in 1969, was acquired in 2001 by Regions Financial Corp., a Birmingham bank that sold the 3,000-employee business to Raymond James for $1.2 billion.
Under Regions, the head office stayed in Memphis, which was home to about a third of the Morgan Keegan workforce. Under Raymond James, most of the senior decision-makers are located in Florida.
Morgan Keegan established a long record as a company paying high salaries and encouraging its employees’ involvement in civic events. Regions’ sale of the business comes amid a turnover of old-line Memphis companies. Buckeye Technologies is being bought by Georgia-Pacific, a unit of Kansas-based Koch Industries. Swiss engineering giant ABB Ltd. recently purchased Thomas & Betts.