Understanding Bernstein's $70MM AB HQ Move
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Thursday, May 03, 2018

Understanding Bernstein's $70MM AB HQ Move

It's official. President and CEO Seth Bernstein is moving AllianceBernstein's (AB's [profile) headquarters to Music City. Yet the publicly traded fund firm won't be completely abandoning Gotham.

Earlier this week, word leaked that New York City-based AB would be moving its headquarters into a new Nashville office tower over the next several years, bringing along more than 1,000 jobs. Yesterday Bernstein, Tennessee Governor Bill Haslam (R), and Tennessee Department of Economic and Community Development Commissioner Bob Rolfe publicly confirmed AB's upcoming move, while AB also filed about it with the SEC.

Bloomberg, the Charlotte Business Journal (Charlotte was another contender for the AB HQ move), CityWire, CNBC, the Nashville Business Journal (twice), and the Wall Street Journal all reported on AB's confirmations.

According to AB's SEC filing, AB staff moving to Nashville will come from compliance, finance, human capital (i.e. HR), internal audit, legal, operations, and sales and marketing. About 1,050 NYC metro area jobs (out of about 3,500 AB employees worldwide) will move to Nashville, and the shift will start this year. Yet "AB will continue to maintain a principal location in New York City," the filing continues, and NYC will continue to be home to AB's PM, New York-based private wealth management, sell-side research, and trading teams.

"We will always maintain a presence in New York City," Bernstein confirmed yesterday.

According to the NBJ, Bernstein aims to complete the 1,050-employee shift to Nashville by the end of 2022, which would make it one of the five-largest employers in the city's downtown. AB is investing more than $70 million in setting up its new HQ, and the state of Tennessee, the Metropolitan Government of Nashville and Davidson County, and the Tennessee Valley Authority are all incentivizing the move. (The details incentives haven't been revealed yet, as the incentives haven't been officially approved.)

Bernstein himself, whose son attended college in Nashville, will be relocating to the city as part of the HQ shift. The AB chief says that "no other city could compete," the NBJ reports, pointing to the city's lower cost of living, lower taxes (Tennessee has no state income tax, though it taxes investment income), shorter commuting times, and more. And of course, those factors can also translate into similarly lower costs for AB, notably for its own real estate.

In addition to Bernstein, Haslam, and Rolfe, both of Tennessee's U.S. Senators and other local officials chimed in yesterday to celebrate the win.

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