Despite $115 million in state incentives organized at the highest levels of state government, the world's largest hedge fund has decided not to relocate its headquarters to Stamford and remain in Westport -- at least for now.
"After careful examination and reflection surrounding the challenges, time, energy, and resources needed to bring the proposed Stamford project to completion, we have decided not to proceed with the move," Bridgewater Associates said in a brief statement issued Friday through its public relations firm.
The deal would have provided the company $115 million in incentives, including a low-interest forgivable loan, tax credits, and grants for training and renewable energy systems as part of a project to build a massive headquarters on a 14-acre peninsula at Stamford Harbor.
The hedge fund is now based at a three-story, 47,314-square-foot complex at 1 Glendinning Place.
While cancellation of the relocation deal Friday was a disappointment to some in Stamford, Westport's top official was pleased the town's third-largest taxpayer is staying put for the time being, and perhaps permanently.
"We're thrilled to retain Bridgewater as a member of our business community," said First Selectman Jim Marpe. "They're good citizens."
In exchange for aid under the state-brokered deal, Bridgewater, which manages more than $150 billion in global investments, would add 1,000 jobs over the next decade to the more than 1,200 employees it currently employs in the state when it moved from Westport to Stamford. Bridgewater was also expected to invest $750 million in building the new headquarters.
In its statement the hedge fund thanked Gov. Dannel Malloy, who personally unveiled the deal to the news media nearly two years ago.
"We are particularly thankful to Governor Malloy for doing his utmost to make this opportunity possible," the Bridgewater statement said. "We are now exploring our other options."
The firm offered no details on what those options may be.
In response to the failed deal, which comes in an election year, Malloy's office said it would continue to support such incentives to lure businesses to the state.
"For a long time, our state failed to compete for the kinds of good-paying jobs with good benefits that will grow and sustain our economy," Malloy's Deputy Press Secretary David Bednarz said in an email Friday. "Working as a partner with our business community, we can make sure that Connecticut businesses can do what we need them to do: grow good-paying jobs here in Connecticut. We will continue working with employers -- both large and small -- in our efforts to regain Connecticut's economic competitiveness."
Malloy had touted the Bridgewater deal, which was part of his Next Five Program, as evidence that Connecticut is willing to compete with other states to retain and grow its financial service sector. The move came just a couple of months after Edward Lampert announced he was moving his $10.5 billion hedge fund, ESL Investments, out of Connecticut to Florida.Read Full Article
Back then, the governor said, "Thanks to the Next Five program, we are clearly charting a new course. The jobs we are announcing today have the potential to grow our economy in a profound way because the spin-off effect of these positions will drive growth in other sectors.
"To have a company of Bridgewater's stature make the business decision to invest $750 million in our state and significantly increase its workforce is not only an extraordinary economic `win,' but signals to the rest of the world that Connecticut is strengthening its leadership position in the very competitive financial services sector."
Bridgewater's decision not to move to Stamford is not seen as a loss, especially in Westport.
Marpe noted the hedge fund earlier this year received approval from the Planning and Zoning Commission that will allow it to make some improvements to the complex they already own in the northern section of town.
Bridgewater Associates is the largest employer in Westport and, as the town's third largest taxpayer, has local holdings assessed at $25,478,050 on the 2013 grand list. The fund also occupies space in Wilton.
Marpe said Friday he has no insight into whether Bridgewater plans to remain in Westport or move to another community. But he said he has met with the firm's management and discussed whether there is anything Westport can do to encourage the firm to keep some operations in town.
Bridgewater's Glendinning Place property -- one of five corporate Design Development Districts in town -- was the subject of public interest earlier this year when a lawyer representing the firm filed a proposal with the P&Z to loosen the tight restrictions on any changes within those zones.
The regulations, adopted in 1980, prevent the DDD "property owners from upgrading their properties," Lawrence Weisman, the lawyer representing Bridgewater, told P&Z officials when he sought a revision of the regulations in February. That was not the intent of the rules, he contended.
Weisman told a hearing on the proposed changes that Bridgewater's current coverage of the Glendinning property is only "about 6 percent lot coverage now."
He also had told the P&Z in February that even though the hedge fund still planned to move the bulk of its operations to Stamford, the firm's officials wanted to keep the executive offices on the Glendinning campus.
"They're going to keep the Glendinning campus as their central executive campus ... and they want to keep it without expanding it," he said. The loosened rules would be used to make other unspecified "improvements" to the complex, he indicated.
But he later cast doubt on the likelihood of any Bridgewater move, telling a Feb. 27 P&Z meeting: "There's only a 20 percent probability of a move to Stamford" at this time.
The P&Z unanimously approved revisions to the DDD regulations in March, but struck a compromise on the allowance for expanded coverage on the affected properties, cutting back the proposal to no more than a 10 percent increase from the 20 percent that Bridgewater sought.
Bridgewater so far has filed no definite plans for expansion on the Glendinning campus, although some kind of new parking facilities may be among the options, according to informal discussion at the P&Z hearings earlier this year.
In Stamford, news that the deal was dead was not a shock, as rumors had been swirling for at least four or five months that there were doubts about it.
The main point of controversy over the proposed move was the location of the site chosen by Building & Land Technology, the developer of the Harbor Point project. A boat yard at the site had been shut down just several months before the deal was announced, sparking protests. The original plan was for Bridgewater to move in by 2017.
A spokeswoman for the developer said the public outcry over the loss of the boat yard had made it clear that Bridgewater needed to look elsewhere.
"Bridgewater has been very patient throughout the development process, and it's understandable that they need to explore options outside of Stamford at this point," Building & Land Technology said through spokeswoman Roxanne Donovan late Friday afternoon. "This process has made all of Stamford aware that the former Yacht Haven site has tremendous potential to provide public access to the waterfront and to be a key component of the redevelopment of Stamford's waterfront as an asset to be enjoyed by all of Stamford's residents. We look forward to working with the city to realize this potential."
Maureen Boylan, Save our Boatyard Founder, was one of those who fought the proposal.
"We're very happy Bridgewater is not coming to the boat yard site, which we assumed all along," she said. "But it's a loss to the city of Stamford with its 29 percent empty commercial occupancy rate. They could be here in Stamford."
Mayor David Martin, who took office Dec. 1, was out of town Friday and unavailable for comment. His chief of staff, Michael Pollard, said the mayor's office heard Friday afternoon that Bridgewater had abandoned its plan to move to Stamford.
"We had talked to Bridgewater multiple times and each of those times we made it very clear that we very much wanted them to come," Pollard said. "We would have welcomed them like we've welcomed so many other companies. We've got an environment and an economy that's very attractive, it just happened not to work out for Bridgewater."
Staff writers Kate King, Maggie Gordon, Rob Varnon and Editor John Schwing contributed to this report.