Location Notebook: Nashville Is Now on the Financial Services Map
AllianceBernstein’s move to Nashville has made it a major player in the financial services sector.
With the increasing speed of business today, companies need to be alert to market conditions and have the assets and know-how to quickly take advantage of economic opportunities when they arise — this also holds true for economic development teams.
When Williamson Inc., the joint economic development group and chamber of commerce for Williamson County, Tennessee, learned that investment management firm AllianceBernstein (AB) was deep in the hunt for a new corporate headquarters, having whittled the list of contenders from 30 cities to just six, it could have simply assumed the opportunity was too far from reach. Instead, it immediately made contact and delivered a pitch, resulting in Nashville being added to the search. Staff then worked tirelessly for nearly a year to show AB officials everything Nashville has to offer.
The dedication paid off. In May 2018, AllianceBernstein announced it was moving its Manhattan corporate headquarters to Nashville, investing $70 million and creating1,050 jobs, and turning down offers from strong financial-market contenders such as Charlotte, North Carolina. AB plans to complete its new headquarters by 2020 and finish the entire transition by 2022. When that happens, the company will be one of the top-five private employers in downtown Nashville.
Making It Happen
“Recruiting AllianceBernstein to the Nashville region was a team effort, with both Nashville’s and Williamson County’s economic development teams working together to highlight the benefits of the region,” says Elizabeth McCreary, chief economic development officer for Williamson, Inc. They also had a good relationship with site consultant Kim Moore, a managing director with Newmark Knight Frank’s global corporate services division, who was representing AB in the search. At her recommendation, Nashville was added to the short list.
This launched an intensive, well-coordinated series of communications, meetings, visits, and in-depth analysis with AB to fully understand its needs. AB had decided to leave its 50-year home base of Manhattan to establish its headquarters in a lower-cost city that would still provide all the business assets it needed, including talent pool, modern transportation and communication infrastructure, and cultural diversity, as well as a high standard of living.
“Economic development is now about talent,” says McCreary. “Companies want to be where the talent is, or where the talent will be. AB was looking for an urban location, which Nashville provided, but the benefits of Williamson County being a neighbor were significant.”
Economic development is now about talent. Companies want to be where the talent is, or where the talent will be. AB was looking for an urban location, which Nashville provided, but the benefits of Williamson County being a neighbor were significant. Elizabeth McCreary, chief economic development officer, Williamson, Inc. “Showcasing Nashville was a true community effort,” adds Courtney Ross, Nashville Area Chamber of Commerce’s chief economic development officer. “We knew that AB had looked at several other cities and that Nashville was a late addition to the mix. This meant we had to tell the story of Nashville’s talented and diverse workforce, low cost of doing business, and superb quality of life in a way that instantly connected to corporate decision-makers who would be relocating not only corporate operations, but also their families, to the city selected.”
Not only did AB make multiple visits to Nashville, Tennessee officials traveled to New York several times to meet AB staff. “We quickly discovered that AB’s C-suite was very authentic,” notes Bob Rolfe, commissioner of Tennessee Department of Economic and Community Development. “We quickly established a rapport with the leadership team, which really helped move the conversation forward.”
Customized Incentives AllianceBernstein will receive a $17.5 million economic development grant from the state to help establish its headquarters. The company is also eligible to receive up to $3.7 million in incentives from Metro Nashville for job creation over the coming years. However, before it made its final location decision, AB asked the Tennessee legislature to enact a law that specifically cuts taxes for publicly traded investment firms the way other states do, such as North Carolina.
This is a potential new frontier for us. We’re really strong in healthcare. We’re really strong in automotive. We’re really strong in logistics. Governor Bill Haslam “We did modify the state statue to match certain tax breaks that two other finalists offered, which allowed us to provide a competitive offer,” adds Rolfe.
A few weeks after the bill became law, AllianceBernstein signed its incentives paperwork and announced it was moving to Nashville.
A Growing Financial Market
AB’s relocation is a big win for Tennessee’s growing financial industry. Since 2011, the state’s financial industry has grown at the second-fastest rate in the Southeast, creating approximately 24,500 jobs. Government officials believe the AB deal will make Nashville more competitive for similar economic development deals. In fact, since the May 2 announcement, eight financial services firms have visited the Nashville region.
“This is a potential new frontier for us,” says Governor Bill Haslam. “We’re really strong in healthcare. We’re really strong in automotive. We’re really strong in logistics. This will be the first time Nashville is home to a national financial services organization. It’s the first step to what I hope will be other companies like this moving here.”
Nashville was the "clear winner by every metric we analyzed,” concludes Seth Bernstein, president and CEO of AllianceBernstein. “Moving our corporate headquarters allows us to offer advantages to our employees that we just simply couldn't do in the New York City metropolitan area. No other city could compete. I see Nashville as a game-changer that increases our competitive edge in an increasingly challenging marketplace."
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