Hill International, the Marlton-based, multinational construction-management and consulting company, says it has settled on Brandywine Realty Trust's One Commerce, Square, 2005 Market Street, as the new location for its corporate headquarters. "We expect to move 120 jobs from Marlton immediately when our (Philly) lease begins next May, and to add up to 100 more" by 2018, David Richter, Hill's president and chief operating officer, told me. He expects the later group of 100 will be "new hires," Richter added.
"Hill will be paying higher rent" in Philadelphia, Richter said. But he's been talking to Philadelphia and Pennsylvania officials about taxpayer incentives to move to a 60,000 sq. ft. downtown space since I wrote about Hill's search fall. Result: "We received financial incentives from the Commonwealth and the City totalling $4.4 million," mostly in grants, Richter says. The state and city have offered sweeteners that will more than cancel higher costs of a few dollars a square foot for years to come:
That includes state money:
- $1 million from a Pennsylvania First program grant
- Up to $666,000 in Pa. Job Creation Tax Credits
- Up to $34,000 in Pa. Workforce and Economic Development Network training funds
Plus city money:
- Up to $1.15 million in Philadelphia Job Creation Tax Credits
- $750,000 in a low-interest Philadelphia city loan
- 450,000 in Phila. Job Training Grants
- $345,000 in a "forgiveable" Philadelphia Industrial Development Corp. loan
That's enough to subsidize Hill's higher cost for several years: Asking rents for office space in the Marlton complex, including utilities, work out to around $23-25 a square foot per year, vs rates in the low $30s for modern buildings in Center City's Market St West, where Hill is moving, says Jason Wolf, whose commercial real estate agency, WCRE, represents Somerset Properties, owner of the Marlton Crossing office park where Hill has been based.
In a statement, Pa. Gov. Tom Corbett referred to the jobs Hill plans to move a few miles west as well as the expected future hires as "new jobs," from Pennsylvania's point of view, and noted the company already employs 134 at sites in Pennsylvania (the company has an existing office in the Graham Building on 15th below Market.) Mayor Michael Nutter welcomed Hill and credited the city Commerce Department and PIDC along with the state for helping close the deal.