TJX Hears Opportunity Knocking Loudly In Marlborough
With its pending purchase of the former Fidelity Investments campus in Marlborough, TJX will plug a big void that was opened when Fidelity decided to close the facility and redistribute 1,100 employees elsewhere.
How much of a lift is this? It’s a huge one for the office space market in the Marlborough-Westborough-Southborough area, where the vacancy rate rose to 31.2 percent from 29.4 percent in the third quarter of 2011 because of the Fidelity decision, according to Colliers International.
Marlborough emerges a big winner, for sure, 12 months after Fidelity’s pullout announcement. It will become home to 1,600 TJX employees now located at offices in Westborough and Framingham (but not from the company’s headquarters). Under a proposed tax increment financing (TIF) agreement with the city, it would also create 75 new permanent full-time jobs that would be based in Marlborough.
That brings us to the non-winners in this transaction. Framingham, the base for TJX since 1976, comes out of this limping, since it will lose some of its labor base. To a lesser extent, Westborough will have a similar problem. But Framingham wants TJX to continue to call the town its home and is talking with company officials to keep their headquarters on Cochituate Road. “The town has worked extensively over the years to build a strong, mutually beneficial relationship with TJX,” Valerie Mulvey, Framingham’s interim town manager, said in a statement.
The recession and Fidelity’s exodus from Marlborough highlighted the need for the state, as well as its municipalities, to make the Massachusetts business climate friendlier. They have made strides in the past year, especially in Central Massachusetts, with noteworthy TIF agreements in Oxford (with IPG Photonics Corp.), Worcester (Saint Vincent Hospital’s cancer center in the CitySquare development), and Franklin (Hamilton Storage Technologies). The commonwealth has helped, notably by lowering the corporate income tax rate from 8.25 percent to 8 percent this year.
In some cases, however, notably TJX's, this zeal to grow the business tax base and add jobs can end up pitting one town against another. That’s a classic example of New England parochialism, in part fueled by the higher property taxes some communities have for businesses.
If you own a business and you own your building, where you locate can mean many thousands of dollars in tax savings. That can be healthy for competition, especially for businesses that would prefer to stay in the areas where their employees live rather than pull up stakes and resettle in a distant state. That’s easy to do when you’re a small, growing business; not so easy if you’re a large, public corporation like TJX.
In such a dog-eat-dog climate, it only makes sense for a community’s leaders to do what they can to compete as best they can to grow their business base.
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