‘We Couldn’t Have Scripted It Any Better’
How a Team Effort Brought Liberty Mutual, and 300 Jobs, to Springfield
It was called Project Evergreen.
Why? Apparently no one from this region who was involved with it has a clue, nor should they, really. Thats because they dont name these initiatives, these so-called blind searches waged on behalf of companies that are looking for office space or real estate on which to build and dont want the world to know theyre looking.
No, that honor goes to site selectors, said Mike Greaney, senior vice president of business development for the Economic Development Council (EDC) of Western Mass. And he told BusinessWest that such regional and national outfits are getting quite creative in this regard. Indeed, projects code-named Ajax, Mercury, Apollo, Sunshine, and even Oceans Eleven have come across his desk and E-mail box in recent months, he said, adding that the EDC might be involved to one degree or another with more than a dozen at any given time.
Very few have worked out as well as Evergreen.
At an elaborate yet top-secret (until the very last minute) ceremony staged at the Technology Park at Springfield Technical Community College, it was announced that Liberty Mutual will be assuming 55,000 square feet in the park (the company inked a 10-year lease), for a customer service call center operation that will employ about 150 people to start and perhaps 300 or more down the road.
Gov. Deval Patrick, eager to showcase examples of job growth and retention across the Commonwealth, turned out for the announcement, ensuring a good crowd (150 people, many of whom had no idea what was being announced) and lots of press which wanted to know more about casinos than call center jobs, but thats another story. Patrick was preceded to the podium by Edmund Kelly, president, chairman, and CEO of Boston-based Liberty Mutual, who eventually uttered a line that economic-development leaders in this region have been waiting to hear from someone like him for decades.
Massachusetts is not an expensive state in which to do business, he said in his heavy Irish accent, if you stay outside of Route 495.
Few of the press accounts, which included an item in Forbes via the Associated Press, picked up on the comment, which didnt seem to faze Allan Blair, president of the EDC, who told BusinessWest that, when it comes to Evergreen and the ceremony to announce its conclusion, we couldnt have scripted it any better.
Whether the Liberty Mutual deal will help the region write more happy endings of this ilk remains to be seen, but Blair believes it has clearly created some momentum, because of the star quality of the company in question (95th on the Fortune 500 list, with $26 billion in revenues in 2007), the sector represented (financial services), Liberty Mutuals desire to add jobs in Massachusetts but look outside Boston, and, perhaps most importantly, an apparent willingness on the part of the Patrick administration to help steer such companies to the western part of the state, and especially Springfield.
Were seeing a genuine effort on the part of this administration to sell Western Mass. in the east, in an appropriate manner, and thats all we ask for, he said. But were seeing more aggressive behavior on the part of this administration than any previous one in this regard, and its very welcome.
That said, Blair was quick to note that, despite this sentiment from the Patrick administration, Liberty Mutual conducted Evergreen by the book, meaning that the company was out to find the best fit it could in Massachusetts or the Northeast (most believe this search extended into Connecticut), not necessarily Springfield. This means the company became effectively sold on this region, and this bodes well for other sales jobs involving other projects with imaginative code names still in progress.
In this issue, BusinessWest goes behind the scenes on Project Evergreen to show how such initiatives proceed, why this one ended successfully, and what it might mean for the region.
Blair says its not uncommon for a search initiative such as Evergreen to have what he called a big lull.
It comes, he explained, when the site selector stops talking with the representatives of one community and starts talking to those in another while keeping that first locale on the hook, as he put it.
Its a somewhat nerve-wracking time, which in this case lasted about a month, he said, adding that its one of many aspects of such blind searches that make them both exhilarating and frustrating.
They generally keep you in the dark right up until the very end, he explained, noting that communities, or regions, usually have no idea with whom theyre competing or where they stand in a search until the party in question makes up its mind. You usually dont know you didnt get it until they make an announcement somewhere else.
Meanwhile, the current weakened state of the economy and generally uncertainty about the future have added some new wrinkles and layers of anxiety to the equation with many projects, said Greaney.
Sometimes you lose out in these searches, he explained, but in a lot of cases, companies are simply delaying their decisions, giving us an on-hold category that appears to be growing.
Evergreen isnt in that category, because Liberty Mutual is eager to take advantage of the states shift to a managed-competition system for auto insurance, and because, by many accounts, the Patrick administration was eager to get a deal done and in Springfield.
The search on behalf of Liberty Mutual started late last summer, when, said Greaney, representatives of the Boston-based site section company CresaPartners first dropped the code name Evergreen, and issued a request for information and, later, another for proposals to suit an unnamed client searching for roughly 30,000 square feet of office space for an undesignated use.
That number would eventually increase twice, in fact, said Greaney, adding that the EDC eventually submitted six or seven possible locations spread across the region, including the STCC Technology Park, located on the grounds of the former Springfield Armory.
Dave Panagore, director of Economic Development for Springfield, said careful consideration was made to ensure that several downtown Springfield properties were included in the discussion, although none were apparently able to match the tech parks mix of facilities, fiber-optic connectivity, infrastructure, and ample on-site parking.
Still, there were some logistical hurdles to be cleared to enable the park to accommodate Liberty Mutual, said Robert Greeley, president of RJ Greeley Co., leasing agent for the park, who noted quickly that no one involved knew it was Liberty Mutual for some time.
All we knew was that it was a significant financial institution, Boston-based, he said, and that the governors office wanted to try and make a deal in Springfield. For a while, we thought it might be Fidelity.
Those aforementioned hurdles included some shuffling to get the desired footprint, he explained, noting that at the heart of the discussions was a former call center operated in the park by RCN, which occupied roughly 90,000 square feet before shutting down that facility in 2003. Roughly half that space would eventually go to Western Mass. Electric Co. (WMECO), which moved many of its personnel and operations into the park in 2004.
To accommodate Liberty Mutual, tech park administrators initiated talks with WMECO that would end with that company effectively giving back about one-third of its space, enabling the park to put together a 30,000-square-foot block of space on one floor that will house phase one of Liberty Mutuals plans, with subsequent phases to go in adjoining spaces.
This was certainly not an off-the-shelf deal, said Greeley. It required some maneuvering and, on WMECOs part, a great deal of cooperation that enabled us to get this done.
Art of the Deal
In response to a question from BusinessWest as to how and why Liberty Mutual came to Springfield and the technology park, Kelly said the choice made perfect sense, which is another remark that Blair and others longed to hear.
He based that assessment on a combination of this regions comparatively lower cost of doing business; infrastructure, meaning the citys fiber-optic network and the facilities within the tech park itself; and workforce quality and quantity.
Whether the region can turn these advantages, coupled with the positive press from the Liberty Mutual lease and support from the Patrick administration, into more jobs for the region remains to be seen.
But Blair believes the pieces are in place for more success stories like Evergreen, especially if business owners can be persuaded, as Kelly was, to consider locations in this part of the state, and then become properly incentivized to locate in the Valley.
I think it certainly makes a difference to the site-selector community and also the CEO community when they read about decisions like Liberty Mutuals, Blair told BusinessWest. Everyone is looking for lower-cost places, and when a leading company like this one makes a move like this, others notice; this will definitely help us.
Greaney concurred, adding that the Patrick camp is doing more than any administration in recent memory to prompt companies to choose Western Mass.
The Liberty Mutual deal didnt swing on this, but many times, as we compete, state incentives become a big factor in the decisions, he explained. Were seeing that this administration is becoming as creative in putting incentive packages together in Western Mass. as other administrations historically were for Eastern Mass., Fort Devens, and places like that. So we have to give the Patrick administration high marks for that.
But beyond whatever push the governor and his administration may have provided, there were other factors in Liberty Mutuals decision that bode well for the Valley, said Greaney, noting, especially, the cost factor.
We know that part of the analysis the company and its consultants did was a geographic continuum of wages, he explained. There were two intersecting lines one was labor availability, and the other was wage rate; where they got to a rate they could swallow but still had a sufficient labor pool, that was the ideal, and they found it here.
Overall, it was a combination of factors that appealed to Liberty Mutual and will appeal to others, he said. The infrastructure needs matched the workforce needs, which matched the wage rates that Liberty Mutual needs to be competitive; all the arrows pointed to Springfield.
Paul Stelzer, president of Appleton Corp., which manages the tech park and many other commercial properties in the region, said Evergreen went as well as it did because of teamwork and the parties effectively playing the roles to which they were assigned.
The EDC was the front door it got Liberty Mutual here to take a look, he explained. But then, the region responded: the Regional Employment Board answered labor force concerns, and an appropriate site with the needed infrastructure was assembled. All the pieces came together thats how you prevail in a search like this one.
Greaney told BusinessWest that he has received more than a few electronic congratulatory notes from site selectors in the wake of Evergreens successful conclusion.
They know how hard it is to close a deal like that, and they also know what it means to the region to have a Liberty Mutual choose to come here, he said, adding that while this is a fairly close-knit community, news of Evergreen has traveled far and fast.
Thats just one of the many positive aspects of this deal, one for which, as Blair said, it would be difficult to imagine a better script.
The task at hand is to write more of them.
George OBrien can be reached at[email protected]