Pearson PLC, the British publishing and education firm, plans to move more than 1,200 workers to Lower Manhattan and Hoboken by 2014, taking advantage of more than $130 million in tax credits and other incentives offered by governments on both sides of the Hudson, officials said Monday.
The move comes at the expense of Upper Saddle River, N.J., where Pearson currently employs 1,275 people, mostly in its education subsidiary. About half of those jobs would move to Hoboken, while the other half would move to a vacant warehouse in the Hudson Square section of Lower Manhattan.
Some of Pearson's operations would also move from Midtown Manhattan, including the Financial Times and the company's U.S. headquarters, according to a spokeswoman for New York's Empire State Development Corp. Another 20 jobs from its education division would move from White Plains.
Pearson's move is a boost to Hudson Square, which has seen an influx of media and advertising companies in recent years. New York Magazine, Omnicom Group and public radio station WNYC all have offices there. The U.S. headquarters of Pearson's publishing subsidiary, Penguin Group, is already nearby.
"Theirs are jobs that are technical and creative," Mayor Michael Bloomberg said at a news conference announcing the move. "So where better for Pearson to grow than right here in New York City, the media and publishing capital of the world?"
Pearson is positioned to reap a series of benefits from its move, which it plans to complete by summer 2014.
After the company threatened to leave New Jersey altogether, the state's Economic Development Authority declared Pearson's jobs were at risk. The authority then was able to approve up to $82.5 million in tax credits last week for the company. The credits are part of a program designed to spur development in urban areas. Pearson plans to rent space in a tower that developer SJP Properties is slated to build on the Hoboken waterfront, according to authority documents.
A similar arrangement with electronics maker Panasonic Corp. came under criticism in the spring. The authority gave the company $102 million in tax credits to move from Secaucus to Newark. Critics said the state shouldn't subsidize the relocation of jobs within the state.
But the authority said the risk of losing firms to other states—especially New York—makes the incentives necessary.
"We were very worried that [Pearson was] going to move with the balance of the headquarters," said Tim Lizura, the authority's senior vice president for finance and development. "There's a lot of compelling reasons for why companies would want to move most of their staffers to a very close proximity."
New York City is expected to provide more than $40 million in energy discounts and other incentives to Pearson and its probable landlord, Beacon Capital Partners. Beacon plans to spend $113 million renovating the eight-story former warehouse at 330 Hudson St. and adding eight more floors, according to the city. New York State's Empire State Development Corp. is contributing $9 million in tax credits.
Andrew Grossman is a reporter for The Wall Street Journal, where this story originally appeared. Write to him here.
