When Deloitte Did the Math, It Needed $2 Mil From Dallas, Or Else It Was Going to Irving
Earlier this year, Deloitte LLP went down to Dallas City Hall and said it was thinking of consolidating its Dallas and Irving operations under one roof ... in Irving. The accounting firm had crunched the numbers, and "there was a multi-million dollar cost advantage to Deloitte LLP if it chose an Irving facility relative to downtown Dallas office buildings," according to a briefing being presented to the city council's Economic Development Committee Monday morning. And so, it was adios, Deloitte. Unless ...
Which beings us to Monday's briefing: The city's Office of Economic Development doesn't want to lose a major downtown tenant. Now's not the right time: Central Business District office vacancy rates haven't been this high in years, and, per the briefing, Cushman & Wakefield reports that "Dallas CBD Office Vacancy rate is the highest in the nation, and twice the national CBD." And so, the city is offering Deloitte an economic development grant worth $2 million, which will come from the Public/Private Partnership Fund and will be paid out in $500,000 increments over four years, beginning December 2011. And what does the city get for its investment?
Subject to City Council approval of the proposed economic development grant, Deloitte LLP has agreed to execute a 10-year lease extension at 2200 Ross Avenue (Chase Tower) beginning 2011 and will:
- Commit to maintain a minimum of 1,111 jobs at this location
- Ensure approximately $19.9 million is invested for tenant improvements
According to the last page of the briefing, City Hall believes the $2 million investment will yield $31 million in "net city fiscal impact." I'm having Deloitte look at the math to tell me if this is anywhere near correct. The council will vote on $2 mil October 14.