Boston-based General Electric will not follow through on plans for a new 12-story office building in the Seaport District and will instead sell the property intended for the project.
The company announced a deal with the state Thursday, and says proceeds from the property sale will be used to reimburse the state for an $87 million investment in the company's new headquarters.
The sale will include both the property owned by GE and an adjacent property owned by MassDevelopment, a quasi-public agency.
GE, a historic conglomerate that has been struggling in recent years, will not come close to meeting its original promise of creating 800 jobs at the headquarters, as the Boston Globe first reported on Thursday.
In a written statement, Ann Klee, GE's vice president for Boston development and operations, said the company has no plans to leave Boston.
“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,” Klee said.
GE has been scaling down operations, selling its oil and gas business, and spinning off a health care division. The company said last year the strategy is to focus on three business units: aviation, power and renewable energy.
Once the sale of the two properties is complete, GE hopes to remain a tenant in the two former Necco warehouses located on one of the parcels. The renovation of the buildings is nearly complete, and GE says it plans to house approximately 250 employees there.
GE will cancel a deal with the city for $25 million in property tax abatements. The deal never took effect, according to GE, because the company never reached the 400-job threshold in the agreement.
Despite the downsizing of its headquarters, GE said it would still complete construction on promised public spaces including a harbor walk, a public dock and the renovation of the "green bridge," which is already underway.
In a statement, Lizzy Guyton, communications director for Gov. Charlie Baker, said "the Administration looks forward to working with GE as the company grows its World Headquarters here in Boston."
Massachusetts and the city of Boston lured General Electric from its Connecticut home in 2016. Jeff Immelt was the company's CEO at the time. Immelt is now gone, as his replacement. H. Lawrence Culp Jr. is now the CEO.
The company was booted from the Dow Jones Industrial Average last year, ending a more than 100-year run.
This article was originally published on February 14, 2019.