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Liberty Mutual plans to expand its Back Bay headquarters and add 600 jobs in Boston, the multi-billion dollar insurance company announced Thursday.
The only Fortune-100 company headquartered in the Hub plans to invest $300 million to expand property on Berkeley Street, which the company said would also create 500 construction jobs.
"Boston is our hometown," said Liberty Mutual spokesman John Cusolito. "It's where we started back in 1912. It made sense for us to further expand our operations here."
Liberty Mutual already employs more than 2,500 people in its Boston headquarters. The new jobs would mirror those that already exist in the city, including actuarial, legal, human resources, underwriting and marketing positions.
Mayor Thomas Menino touted the expansion as an opportunity to make a dent in local unemployment numbers. "Liberty Mutual and the insurance sector represent a $3.2 billion industry that is critical to Boston's economic growth," the mayor said in a statement.
"We are hopeful that the process will move forward," Cusolito said. "We've had excellent working relationships with Mayor Menino, Gov. Patrick and their staffs, who have worked hard with us to make this investment in Boston."
To move forward, Liberty Mutual needs approval on a property tax deal called a Tax Increment Financing agreement, or TIF. Under the proposed TIF, Liberty Mutual stands to earn a $16 million tax credit from the city — as well as a "comparable" credit from the state — in exchange for the legal promise to bring 600 jobs and an expected revenue boost of $50 million to the city over 20 years.
If Liberty Mutual doesn't deliver, the city would have an option not to grant the tax credit, according to Boston Redevelopment Authority spokesperson Jessica Shumaker.
The BRA will vote on the TIF agreement at its board meeting next Tuesday. The agreement must then be approved by the City Council at the local level and by the Massachusetts Economic Assistance Coordinating Council at the state level.
Cusolito said the TIF agreement was "essential" to the deal. A Q&A released by the Boston Redevelopment Authority noted that Liberty Mutual has other options for expansion.
If the deal goes through, Liberty Mutual would break ground this year on a 30-story tower with 580,000 square feet of office space in the Back Bay, slated to open in 2013.
That expansion would raze the old Salvation Army building and the Benjamin Franklin Smith building, which are located adjacent to Liberty Mutual's current home office at 175 Berkeley Street. The former Salvation Army building previously generated no tax revenue for the city.
This program aired on February 11, 2010. The audio for this program is not available.
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