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* Background and more react is here if you need it. Sun-Times…
Boeing said Thursday it plans to move its headquarters to Arlington, Virginia, close to the nation’s capital. It said the new location also will serve as a research hub.
“We are excited to build on our foundation here in Northern Virginia. The region makes strategic sense for our global headquarters given its proximity to our customers and stakeholders, and its access to world-class engineering and technical talent,” Boeing CEO Dave Calhoun said. The Wall Street Journal first reported the move.
Boeing said it will maintain a significant presence at its Chicago location and surrounding region but did not offer specifics. “We greatly appreciate our continuing relationships in Chicago and throughout Illinois. We look forward to maintaining a strong presence in the city and the state,” Calhoun said.
Calhoun offered thanks to Virginia Gov. Glenn Youngkin and U.S. Sen. Mark Warner, D-Va., for their support. Details about local incentives were not immediately known.
Boeing has had about 500 employees in Chicago at the 100 N. Riverside Plaza headquarters, but the number of people present there fell dramatically during the pandemic.
* Tribune…
The move will not lead to major Chicago job cuts or relocations, and the company will continue to employ more than 400 people in the city, Boeing spokesman Paul Lewis said. Still, the company will cut office space, needing less as telecommuting has led to more flexible work options.
Boeing is the latest company to shrink its space in Chicago, as the city’s downtown and office market reel from two years of the COVID-19 pandemic. In December, United Airlines announced it would move 900 employees — more than a quarter of its downtown workforce — from its Willis Tower headquarters to Arlington Heights. […]
Boeing’s downsizing will now open another hole in the downtown Chicago office market. The company occupies 285,000 square feet on 13 floors in the 36-story riverfront tower, which totals more than 1.1 million square feet, according to CoStar Group.
And even though thousands of office workers recently began streaming back to the Loop for at least several days a week, more empty spaces keep popping up in 2022, a sign that the market still hasn’t recovered from the two-year-old pandemic. The downtown vacancy rate jumped to 19.7% by the end of March, according to a report from commercial real estate firm Colliers International, up from 17.9% at year’s end.
My own opinion is downtown was over-built during Rahm Emanuel’s tenure.
* Joe Cahill at Crain’s…
Critics often complain that Boeing itself brought relatively few jobs for the tens of millions in subsidies state and city leaders shelled out. And it’s true that the Boeing corporate headquarters only employed a few hundred.
But the parade of companies that came in Boeing’s wake boosted that total many times over. Eventually, companies were moving here without getting a dime of taxpayer money.
The main benefit of Boeing’s move was reputational. It’s hard to put a price on it, but the value is undeniable. […]
Boeing’s exit comes as Chicago’s reputation has plummeted to lows we haven’t seen since the 1970s. The city and state have become known globally for uncontrolled crime, surging taxes, corruption and fiscal disarray. Downtown office buildings that drew new tenants in the last two decades haven’t been able to reverse the exodus of workers during the pandemic, and Loop landlords are handing the keys to lenders.
A new headquarters across from Washington will allow Boeing to assert itself in the world of national security, with more than half of the $62 billion it generated in sales last year coming from military contracts. The Arlington location will place top executives near political leaders, many of the nation’s top defense contractors and a stone’s throw from one of Boeing’s top clients: the Pentagon.
Boeing’s decision “shows that the Commonwealth is the premier location for aerospace companies,” Virginia Gov. Glenn Youngkin (R) said in a statement.
Boeing is also planning to develop a research and technology hub in Arlington “to harness and attract engineering and technical capabilities,” according to a company statement. The hub will focus on developing innovations in cybersecurity, autonomous operations, quantum sciences, and software and systems engineering. […]
Youngkin’s administration has been working with Boeing for the past couple of months to lure the company to the state, according to three people familiar with the deal who spoke on the condition of anonymity because the company had planned to wait until next week to make the announcement. They said the governor, a former Carlyle Group executive, has a personal relationship with Calhoun.
The state did not offer Boeing any “significant” financial incentive, according to the three people. Arlington County offered no incentives.
Sen. Mark R. Warner (D-Va.) had long casually nudged Calhoun and senior Boeing leadership about moving to Virginia. But he said he had a more serious conversation with Calhoun about the benefits last year, pointing to Virginia drawing major tech and defense companies, such as Amazon and Northrop Grumman. Warner also credited Virginia Tech, noting that the university’s new innovation campus — slated for nearby Alexandria in 2024 — likely also was appealing as Boeing plans its research hub.
Gov. Pritzker has been pushing to make Illinois a quantum research hub, so this can be seen as a blow to that effort as well.
* Mayor Lori Lightfoot…
Chicago is a world-class city and in the last year, 173 corporations relocated or expanded here, and 67 corporations have made that same decision since the start of 2022. While Boeing has decided to move their headquarters to another city, they will still maintain a presence in Chicago. We have a robust pipeline of major corporate relocations and expansions, and we expect more announcements in the coming months. What remains to be true is that Chicago is a major hub for global corporations that recognize our diverse workforce, expansive infrastructure, and thriving economy.
* Richard Irvin campaign…
Chicago’s business community took yet another hit yesterday as Boeing announced it is moving its headquarters out of Illinois to Virginia. The loss of Boeing adds to the growing list of businesses, big and small, fleeing the state, and creates more vacancy in the downtown area that has already been struggling to bounce back since the Covid-19 pandemic.
While the official line is that Boeing executives wanted to be closer to Washington D.C., it should be lost on no one that the undercurrents of J.B. Pritzker’s pro-criminal policies are clearly not helpful. The police beat that includes Boeing headquarters had 43 public batteries, 29 assaults, 27 robberies and 29 motor vehicle thefts last year alone. Just last weekend, nine people were killed and 26 wounded including a man who was shot and killed in a Streeterville hotel and a woman who was murdered at State Street and the Chicago River.
“Another day, another company heads for the exits on J.B. Pritzker’s watch - make no mistake his pro-criminal policies and anti-business agenda are the undercurrents driving businesses to greener pastures,” said Irvin for Illinois campaign spokesperson Eleni Demertzis. “Illinois businesses and families need a leader who will make this state a better place to live and thrive, and that simply is not possible with a governor who chooses criminals over safety in our communities.”
…Adding… Jesse Sullivan…
Sadly, news about leaving Illinois barely qualifies as “news” any more. For families, neighbors, and businesses big and small, Democrat leadership in Chicago and Illinois has made workers feel unsafe and businesses feel unwanted. Jesse Sullivan, outsider candidate for governor, released the following statement:
“Boeing’s departure is the latest example of how Democrat leadership is completely failing Chicago and Illinois. Temporary tax bribes to companies cannot paper over decades of fiscal mismanagement and the worst tax burden of any state. Add in rising crime that makes workers feel unsafe, as well as a corruption tax and politicians who care more about the next election than the jobs of the future, and we’re in for a lot more stories like this one. We need a change.
“For businesses, we need regulatory reform and a long-term commitment to growth to move Illinois from a temporary stopover to an attractive forever home to new families and businesses.
“For workers and families, we need to clean up our streets, crack down on corruption, and fix our worst-in-the-nation tax burden, or we’re going to keep leading the nation in losses, not growth.”
posted by Rich Miller
Friday, May 6, 22 @ 9:29 am
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Me to Boeing: “Bye, Felicia.”
Comment by Colin O'Scopy Friday, May 6, 22 @ 9:36 am
Richard Irvin will not make Illinois a better place to live. Unless you want to live in a police state.
Comment by Cheryl44 Friday, May 6, 22 @ 9:39 am
My take is no matter how deep the state’s trough, the G’s doesn’t have a bottom.
Comment by Flyin' Elvis'-Utah Chapter Friday, May 6, 22 @ 9:42 am
Cahill is right on spot. They never brought much of anything to the state except their hand out. Monster company but
Comment by Cannon649 Friday, May 6, 22 @ 9:48 am
Boeing’s HQ in Chicago was a lot like these “data centers” that Facebook, Google, and Amazon put in rural communities in the Midwest, like Iowa. They come in with great fanfare but after the initial construction jobs leave, the employees left to run these centers equal dozens, not hundreds or thousands.
It looks good on paper but without the manufacturing facilities with union jobs and vendors building offices for the supply chain, Boeing’s presence in Chicago was negligible, at best.
A few dozen “C-suite suits” on a few floors in a building downtown did not deliver the impact that it could have been. Heck, mid-sized law firms have a bigger economic impact than Boeing ever did.
Comment by Colin O'Scopy Friday, May 6, 22 @ 9:48 am
It stinks to lose a high profile company like Boeing. But if McCormick Place stays busy with trade shows and new conventions are lured to the city the impact will be greater.
Comment by Cool Papa Bell Friday, May 6, 22 @ 9:55 am
Irvin’s campaign matches the weather, miserable and gloomy. Another Republican who promises a better future by running Illinois into the ground. Oligarchs like Griffin and their political hacks, Youngkin, decide where to land based on personal friendships.
Comment by froganon Friday, May 6, 22 @ 9:56 am
“A new headquarters across from Washington will allow Boeing to assert itself in the world of national security, with more than half of the $62 billion it generated in sales last year coming from military contracts. The Arlington location will place top executives near political leaders, many of the nation’s top defense contractors and a stone’s throw from one of Boeing’s top clients: the Pentagon.”
This is it in a nutshell. They are going to where they can Lobby without having to travel back and forth. While I am no fan of Pritzker or Lightfoot, this move is no fault of theirs, rather a move so they can be a full time Lobbying Firm.
Comment by SOIL M Friday, May 6, 22 @ 10:02 am
Sounds more like a pivot on their operations. They are trying to focus more on government and defence work. Virgina is close to D.C. as well as foriegn governments. Chicago was more for when they still had a large focus on passenger aircraft.
Comment by Publius Friday, May 6, 22 @ 10:04 am
Funny, Irvin and Sullivan didn’t happen to mention the credit rating improvement. Something that actually has a financial benefit for the state and the taxpayers.
How much revenue did Boeing generate for Illinois?
Comment by JS Mill Friday, May 6, 22 @ 10:14 am
“Boeing is also planning to develop a research and technology hub in Arlington…The hub will focus on developing innovations in cybersecurity, autonomous operations, quantum sciences, and software and systems engineering”
Double loss - HQ move and developing new R&D in Virginia. Not great as the Illinois Institute of Technology and Fermi Lab are focusing on a “Superconducting Quantum Materials and Systems Center”
Comment by Donnie Elgin Friday, May 6, 22 @ 10:21 am
==Boeing’s exit comes as Chicago’s reputation has plummeted to lows we haven’t seen since the 1970s.==
Does Cahill know that Boeing’s reputation is at an all-time low? Their corrupt regulatory capture lead directly to over 300 people being killed.
Comment by Google Is Your Friend Friday, May 6, 22 @ 10:21 am
If you are moving thoughts to defense contracting and DoD, Chicago makes no sense to that… then throw in tax breaks sunsetting…
Boeing is a Seattle company that has completed the move, figuratively and actually, to DC.
Comment by Oswego Willy Friday, May 6, 22 @ 10:28 am
==Boeing’s reputation is at an all-time low==
GIYF nails it (exclamation point) I have a four letter word (actually acronym) to say to Cahill…MCAS
Comment by Jocko Friday, May 6, 22 @ 10:32 am
Agree with everyone that this has little to do with Illinois.
The bigger issue is the changing landscape for HQ’s. Being a destination for corporate HQ’s was great until it wasn’t. The post pandemic remote workforce represents a major long term hit to the Chicago real estate market. Too bad we didn’t work as hard to bring factories there as we did bright shiny glass palaces for corporate execs.
That said, I think Cahill’s take is overly negative. I think starting largely in the Emanuel tenure, Chicago regained its cool. In the 90’s and early 2000’s, Chicago was seen nationally as just another big city, without the coolness and desirability of a New York or LA. Chicago has regained its luster as a place to be. I think the work to attract Hollywood has been a huge part of that.
There is a desire for people to be there, we just need to make sure they have a good reason, as in jobs and good schools.
Comment by Wonky Kong Friday, May 6, 22 @ 10:35 am
Overbuilt under Rahm? True the man did love getting updates on a running tally of tower crane permits. But there were also a lot of suburban office relocations to downtown too which was a national trend.
At the same time even pre-pandemic there were signs of leasing stress as WeWork stopped gobbling up office floors in downtown. Add in a lot of 10 year leases signed post-Great Recession ending right as Covid reduced demand for on-site office space? Seems like it will be a rough few years for many downtown Chicago landlords regardless.
Comment by ChicagoBars Friday, May 6, 22 @ 10:48 am
Let’s convert the unused commercial properties downtown into more mixed market rate and affordable housing units
Comment by make lemonade Friday, May 6, 22 @ 10:48 am
This is a blow to Chicago’s reputation, but not really indicative of anything deeper. Boeing is pretty transparent that it wants to be closer to the Pentagon, has nothing particularly bad to say about Chicago, and is still leaving behind a few hundred office workers. The actual impact will be small.
DC has most of the same crime problems Chicago has (well, Arlington doesn’t, but it’s still close by), as well as its own corruption culture. And although nobody’s ever moved their company because of a state’s credit rating, Illinois’ just went up, so that’s not it either. Again, there’s no reason to see this as a judgement on Chicago, Illinois, or their leaders–except insofar as they’ve failed to recruit the Department of Defense to set up shop here.
Comment by Benjamin Friday, May 6, 22 @ 10:54 am
We did not try hard enough to attract non union manufacturers like Toyota that pay great wages or attempt to lower some of the highest workers comp premiums in the nation that could have taken advantage of our great location
Comment by Lucky Pierre Friday, May 6, 22 @ 10:56 am
“It’s not personal, Sonny. It’s strictly business”.
Comment by The Magnificent Purple Wombat Friday, May 6, 22 @ 11:03 am
It should be expected. SpaceX is beating them into space and Airbus is getting into their commercial airline market, so they need to be closer to the “power” to help them in this market. At this point NASA might as well give up on Boeing and contract everything with SpaceX until such time that Boeing can at least show some level of competence in space travel/launchings.
Comment by techman Friday, May 6, 22 @ 11:04 am
=== We did not try hard enough===
Meh. Union work is worth having too.
Plus, there’s a car plant in Normal, as an example, that the last administration not only ignored, that governor didn’t “know” if it existed.
Good try. No.
How about those upgrades - Lucky Pierre -?
You were very silent about them. Why?
:)
Comment by Oswego Willy Friday, May 6, 22 @ 11:13 am
=== This is a blow to Chicago’s reputation===
Really? How?
Business folks know the score; this was about tax breaks but more importantly about DoD and a changing model that now is about “location” it seems.
If folks haven’t noticed, Chicago ain’t a “one business” town.
Comment by Oswego Willy Friday, May 6, 22 @ 11:16 am
Regardless of the usual suspects gloating about BA moving- it’s a loss of prestige to Chicago and dozens of not- for-profits which have received support from this Corporation. Criticizing BA for its recent manufacturing issues and thinking that Illinois is better off losing this premier company is the height of idiocy
Comment by Sue Friday, May 6, 22 @ 11:27 am
Union jobs are good too? Who said they were not but non union manufacturing jobs pay wages that can feed a family.
Silent about the upgrades?
After the upgrades Illinois is still rated 50th for fiscal health
https://www.usnews.com/news/best-states/rankings/fiscal-stability
Crime and political corruption are still out way out of control and cause real damage to our economy and chance for population growth your silence and gas lighting not withstanding
Comment by Lucky Pierre Friday, May 6, 22 @ 11:29 am
- Lucky Pierre -
Your cite… is from March 2021.
Do better. Its good news.
=== Crime and political corruption are…===
… likely to be overshadowed by abortion come November, and to the economics for Chicago, lemme know your mayoral candidate, just make sure it’s not a Dem.
Comment by Oswego Willy Friday, May 6, 22 @ 12:32 pm
Feel free to cite any more recent credible source ranking Illinois fiscal health higher than 50th as well as any poll that confirms your proclamation on the ramifications of the not yet confirmed abortion ruling and how it will affect the Fall elections for state and federal offices.
Like most people I think I will wait to declare my preference for the Mayor of Chicago in February of 2023 until after all the candidates announce. I can assure crime will be a bigger issue in that race than abortion.
Comment by Lucky Pierre Friday, May 6, 22 @ 12:49 pm
===Feel free to cite any more recent===
You were a strong impasse cheerleader. It’s time to sit the heck down.
Comment by Rich Miller Friday, May 6, 22 @ 12:50 pm
Boeing was an engineering firm that went into manufacturing and wind up as a lobbying firm.
Comment by Steve Friday, May 6, 22 @ 12:55 pm
It’s not great for any large company to leave downtown. There is not a whole lot to say though when the company leaves to be closer to its number one client — the federal government.
Comment by Three Dimensional Checkers Friday, May 6, 22 @ 1:48 pm
I actually think it makes sense for Boeing to move part of its Chicago operation to Arlington. I also think the timing is right (e.g., after Covid reduced the on-campus workforce). Moving their business office to just outside the Pentagon (also in Arlington, VA) is a rational decision. It allows corporate officers to interact daily with their lobbists. It really does make sense, regardless of its impact upon Chicago.
On the other hand, Lucky’s inference that this is about the loss of a large number of high paying, manufacturing jobs in Chicago is misplaced. First, these are primarily corporate office jobs relocating, not blue-collar jobs. Second, the jobs relocating were never union jobs.
As to attracting “union jobs” v. “non-union jobs,” that sort of thinking is not the purview of good government. Good government attempts to attract jobs period. I am not sure why Lucky is suggesting Illinois government has a history of soliciting only unionized jobs. Is there evidence of Illinois rejecting non-unionize, job creators?
Comment by H-W Friday, May 6, 22 @ 2:31 pm
“You were a strong impasse cheerleader. It’s time to sit the heck down.”
Or perhaps answer a simple question. Would we have gotten those upgrades had Rauner been re-elected and forced another impasse? Here’s a tip: Rauner had eight consecutive credit downgrades and amassed $17 billion in unpaid bills. Pritzker and Democrats have achieved six consecutive upgrades and put a billion in our rainy day fund.
I’ll sit back and wait for your spin.
Comment by New Day Friday, May 6, 22 @ 3:45 pm
=== Double loss - HQ move and developing new R&D in Virginia. Not great as the Illinois Institute of Technology and Fermi Lab are focusing on a “Superconducting Quantum Materials and Systems Center”===
Unless you can move Chicago, as a whole, to DC, it’s a moot observation.
Comment by Oswego Willy Friday, May 6, 22 @ 4:02 pm