A few days ago, JPMorgan Chase announced third quarter net income of $5.6 billion. So it makes perfect sense that the bank would ask for "more than $1 billion in concessions from the city and the state while it continues to pare its payroll in the city" if they built a new headquarters at the Hudson Yards, according to the NY Times.
The Hudson Yards, one of Mayor Bloomberg's pet development projects, will transform a desolate stretch of Manhattan's West Side, from 30th to 34th Streets and between 10th and 12th Avenues, into gleaming millions of square feet for office space, shops, residences and parks. Time Warner, Coach and L'Oreal are all moving there, and now JPMorgan Chase wants nearly four million square feet for its 16,000 employees.
The Times reports, "The talks, which involve one of the largest real estate complexes for a single company in New York City history and a large package of incentives for Chase, have reached a feverish state after nearly falling apart this week. The negotiations are so delicate that few people are willing to discuss them publicly for fear of alienating one side or another. have reached a feverish state after nearly falling apart this week."
There's also a lot of political calculus at stake—from the Times
For Gov. Andrew M. Cuomo, offering generous subsidies and special incentives would provide more fodder to critics who say he has been too eager to please corporate and real estate interests that represent important sources of financial support for his re-election campaign.
And for Mayor Bill de Blasio, a fellow Democrat, who has railed against corporate subsidies, supporting the project would represent a significant departure that could be difficult to justify to his supporters on the left. At the same time, if the mayor opposes the project, it could leave him open to criticism that he is indifferent to the needs of the city’s largest employers.
The bank, however, has insisted that the benefits from the proposed deal would outweigh the value of any concessions or subsidies, especially since Chase would have to buy development rights from the city and make certain annual payments in order to erect the towers.
Deputy Mayor for economic development Alicia Glen told the Times, "There’s no way that the city would entertain a demand for a billion dollars in additional incentives at Hudson Yards. We have always been willing to engage with them in a dialogue about how we could be helpful in making a move more feasible." Yeah, why give crazy 10 figure tax breaks to an architect of the 2008 subprime mortgage meltdown? Keep it to the nine figures!
The move would enable the bank to consolidate its employees, who are currently at two buildings (one on Park Avenue and one on Madison Avenue). Earlier this year JPMorgan Chase announced it would purchase a Jersey City building and add another 1,000 employees there, thanks to tax incentives.