For companies considering relocating or expanding to Florida, the investment in Commercial Real Estate is a major expense. These companies should be aware of the incentives that may be available to them.
In the wake of the past recession, Florida wants to increase employment. With each corporate relocation Florida is not only creating employment, but if the jobs are high paying then it also raises the per capita income.
With its sea ports, proximity to South America ,international airports low cost housing and business space plus the natural beauty. Florida already is appealing to many out-of-state companies as place seeking to expand or relocate . But government has realized that the appeal alone is not enough. The State of Florida, its Counties and the Cities are courting out of state companies to relocate and expand into to their area. They are offering financial incentives to enhance the appeal
As an example for the companies moving to Tampa Bay
Amazon is opening a $200 million distribution center in Hillsborough County which will create 1,000 jobs Amazon will receive local and state incentives for the 375 high paying jobs of approx. $1 million plus property tax reductions over seven years of $6.4 million
Briston Myers will open a new North America Capability Center in Brandon that will create 579 jobs. They will receive incentives of $2 million from Hillsborough County plus additional state incentives that will bring the total incentive package up to $6 million
In Clearwater, the city recently used incentives to convince General electric to relocate positions from New York. GE made a $49 million investment and relocated 263 jobs.
The incentives are not just being used to help out-of-state companies. Local companies are also benefiting.
As an example, Retail Process Engineering LLC is relocating its corporate headquarters from Tampa and has purchased an office building in Pasco County to serve as its new headquarters. The Pasco Economic Development Council is assisting with the relocation. The company is anticipating job creation incentives of $5,000 per job created, equal to a total of $80,000. It should be noted however that average wage of each job is more than $105,000 which is more than three times the average annual wage in the county ($32,161). That was why Pasco County was so aggressive in the incentive package that it offered. The local incentives was a major reason cited by the company for selecting Pasco County as its new home
However, the State and the local authorities are conservative. They won’t just give money away. There are certain criteria that any government authority will look at before offering incentives.
Industry: QTI is Florida’s Qualified Target Industry Program. Industries such as Information Technology, Aviation, Life Sciences and financial services are their prime targets.
Salary Level: QTI is targeting companies that will pay higher than average salaries
The number of Jobs – less than ten jobs will not usually merit any incentive package
Typically the government officials will want to understand the companies commitment. They will ask how much the company will invest in commercial real estate, and how much they will invest in equipment. They will also want a sense of the competition. What options other than Florida or the particular geographic area is the company considering. The incentives are usually performance based. They are given after the company has created the promised jobs
An important aspect for companies that are considering applying for an incentive package is that they do not sign a contract to purchase an Office Building or the purchase of an Industrial facility before meeting with the local Economic Development Councils and making a formal application for an incentive package. The company must create the atmosphere where the EDC competes for the company relocation or expansion and the jobs the company will bring. You want the county to offer their best package. Once a lease is signed for commercial real estate or commercial real estate is under contract or has been purchased in Florida, the State and local government know that the Buyer is already locked in. The company will move regardless, so there is no incentive to offer incentives. If you are considering a corporate relocation or expansion and think that you may qualify for incentives, then then we encourage our clients to make a visit to the local Economic Development Corporation one of the first stops that they make. We are more than happy to set this up meeting for our clients.
With careful planning and awareness of the inventive programs available the company that is considering moving or expanding into Florida can make a huge difference to its bottom line