Global accounting giant E&Y will receive a $39.7 million thank you for moving a chunk of its Manhattan operation to New Jersey.
The stateʼs Economic Development Authority approved the payout last month as part of its Grow New Jersey campaign.
Grow NJ is a job creation and retention incentive program that is designed to give New Jersey a competitive edge against tax incentive programs in surrounding states.
Businesses that are creating or retaining jobs in the Garden State can apply for tax credits ranging from $500 to $5,000 per job, per year; with bonus credits ranging from $250 to $3,000 per job, per year.
A spokeswoman for the EDA told Real Estate Weekly that E&Y will get yearly payouts of around $3 million as part of its deal to relocate some employees from its offices at 5 Times Square to 121 River St. in Hoboken (pictured top).
Virginia Pellerin, program manager with the New Jersey Economic Development Authority said in an email, “Global accounting firm EY (formerly Ernst & Young) was approved at the July meeting of the Board of the New Jersey Economic Development Authority (EDA) for Grow New Jersey (Grow NJ) tax credits of up to $39.7 million over ten years. The project is associated with $54 million in private investment and the creation of 430 jobs in Hoboken.
“As a performance-based program, approved Grow NJ projects must first generate new tax revenue, complete capital investments, and/or hire or retain employees to receive approved benefits. Once the company has met its commitments, tax credits are issued at the rate of one-tenth of the total approved per year for ten years, as long as the project continues to maintain its associated job numbers.
“The company has certified, as required by legislation, that the approval of tax credits is a material factor in its decision to advance the project in New Jersey.”
E&Y has signed a 168,165 s/f lease with SJP Properties for the space within the company’s waterfront corporate center.
The global firm is expected to take occupancy of its space in Waterfront Corporate Center II in June 2017.
The CBRE team of Michael Geoghegan, Craig Reicher, Glenn Dyke, Joan Meixner and Nick Hilton represented EY in the transaction. SJP Properties was represented in-house by Executive Vice President Jeff Schotz and Senior Vice President Peter Bronsnick.
E&Y currently leases one million square feet at 5 Times Square but has been examining a number of options to relocate, according to multiple reports. The company’s Times Square lease expires in 2022.