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Boston business and political leaders are celebrating the announcement by General Electric that it’s moving to the Seaport District.
Starting this summer, 800 executives and top product managers will pack up their desks in Fairfield, Connecticut, and move in next to Boston startups, tech incubators, design companies and biotech firms.
Imagine if General Motors left Detroit or Apple left Cupertino. GE leaving Connecticut is like that.
"I was at Cathedral High School, and I was like: 'Oh boy!' "
That’s how Boston Mayor Marty Walsh reacted when GE Vice President Ann Klee phoned him Wednesday. She said the global corporation that has housed its world headquarters on a suburban campus for 42 years is moving to the Boston waterfront.
"GE recognizes the innovations in our city, the educational institutions in our city, the diversity of our city, the people of our city, and the business-friendly environment of our city that we’re putting out there," Walsh said. "So we’re excited about this."
Walsh thinks more companies will follow. Even some of GE’s competitors here say the move will be felt around the world.
At an innovation fair in the Back Bay on Wednesday, employees of OSRAM SYLVANIA demoed smart lighting solutions.
"I don’t think it’s surprising that GE moved here," said Lori Brock, OSRAM's head of corporate innovation in the Americas. She said GE is moving to Boston for the same reason OSRAM is based in Wilmington.
"The people, the universities, the startup scene. You can’t ask for more than that if you want to be a high-tech innovative company," she said.
In some ways, General Electric mirrors Massachusetts’ transition from blue-collar manufacturing to the knowledge economy. The company once best known for making light bulbs has transformed into a global services firm at the forefront of energy, health care and Internet technologies.
Boston has picked up a heavyweight. With $130 billion in annual sales, the top 10 Fortune corporation will be by far Massachusetts’ largest public company. That’s a big ego boost for the region, after years of losing corporate headquarters, from Gillette to EMC to Facebook.
Swapnil Shah, the CEO of an energy analytics company in Lexington, said GE will create new opportunities for college students, entrepreneurs and researchers.
"There’s always been a lot of interesting startups and midsize companies," Shah said. "But having an anchor tenant really provides a base for these graduates to really build their careers."
To help GE pick up anchor, Boston is offering $25 million in property tax relief over two decades.
City Economic Development Chief John Barros said it’s worth it.
"The potential impact over those 20 years would be $260 million, a little bit more than 10 times the total tax incentives that we are providing GE at this point," Barros said.
The state is offering an additional $120 million, to help with things like helipads and hangars for GE’s fleet of corporate aircraft. The short jaunt from the Seaport to Logan International Airport was a key selling point.
Massachusetts Gov. Charlie Baker said he didn’t have to go overboard.
"The big message here is this is a great place not to be for the next two years or the next five years, but for the next 50 years," Baker said.
GE agrees. It released a statement that does not talk about its bottom line, but rather Boston’s top people and ideas.
This segment aired on January 14, 2016.