Honeywell, a Fortune 100 technology company whose products range from airplane cockpit systems to security systems for hospitals, announced Friday that it is relocating its headquarters to Charlotte from New Jersey.
“Today is a landmark day for the city of Charlotte and the state of North Carolina, one that will impact our business landscape for years to come,” said N.C. Gov. Roy Cooper. The Observer reported the move Thursday, based on sources with knowledge of the deal.
But the move is dependent on the passage of an economics incentives package with tax breaks for Honeywell. Cooper said that final approval is expected Monday, after the General Assembly on Thursday approved legislation that raises the amount of incentives the state can award companies for economic development projects.
Cooper said the amount of the incentives package from the state won’t be released until the state officially awards the grant Monday. However, it’s likely to be record-setting: Mecklenburg County Manager Dena Diorio said the county’s share of the incentives package is more than $28 million, the biggest the county has ever offered one company. Mayor Vi Lyles said the city is offering $17 million in property tax breaks.
That means the combined local incentives are at least $45 million.
Cooper said that in addition to the tax breaks, Honeywell was lured by Charlotte’s low cost of doing business, the state’s business-friendly climate, and infrastructure like the city’s airport that allows easy access for companies.
“There were many locations in the running for this corporate headquarters,” said Cooper. “It’s been months and months. This has been in conversation for quite a while.”
The company plans to relocate about 150 to 200 senior corporate employees by Sept. 2019. Honeywell will also move about 100 South Carolina-based jobs to Charlotte (Honeywell bought Fort Mill-based Transnorm, a warehouse automation solutions company, in a roughly $484 million deal this month). The company will then hire 500 more employees in Charlotte over the next five years.
State legislators have said the median wage for the jobs will be about $85,000.
The announcement was made in uptown at the Charlotte headquarters of asset manager Barings, in the 300 South Tryon office building, where Honeywell will initially lease space. Cooper said the company’s total investment in Charlotte will be $248 million. Sources have told the Observer the company is planning to move to either SouthPark or Ballantyne.
“This was a very competitive process,” said Honeywell CEO Darius Adamczyk, who said he had previously lived in Charlotte and watches the Carolina Panthers every Sunday. “This announcement is a little premature, given some of the things we heard yesterday. Our decision to move to Charlotte still depends” on the incentives package being approved, he said.
The firm is a major manufacturer of electronics, aerospace and electronic equipment. This isn’t the first time in recent years Honeywell has moved headquarters. In 2015, Honeywell received a $40 million incentives package from New Jersey to keep its headquarters in that state, though it did move several miles to a new campus from its decades-long home in Morris Township, according to news reports at the time.
Honeywell will retain about 800 jobs at its Morris Plains, N.J. facilities, the company said. The announcement apparently came as a surprise to some New Jersey officials. A report Friday in ROI-NJ, a business publication, quoted a Morris Plains official Friday as saying they “didn’t know anything” about the move.
Luring back Fortune 500 firms
For Charlotte, Honeywell’s move increases the number of Fortune 500 firms headquartered in the area. That group is currently at six companies: Bank of America (No. 24), Lowe’s Cos. (No. 40), Duke Energy (No. 125), Nucor (No. 151), Sonic Automotive (No. 298) and Sealed Air (No. 456).
Sealed Air, which makes Bubble Wrap, was the last Fortune 500 firm to relocate to Charlotte, also from New Jersey. In 2014, the company announced plans to relocate its headquarters from Elmwood Park, N.J., bringing 1,262 jobs.
Honeywell ranks 77th on the Fortune 500 list, based on annual revenue of about $40.5 billion.
Snagging Honeywell helps Charlotte reverse a trend in which the number of Fortune 500 companies in the area has been falling for a decade. Nine companies made the list in 2007.
The decline has mostly been due to acquisitions and spinoffs. Family Dollar was acquired and is moving its headquarters out of Matthews, and local firms such as Belk and Harris Teeter have also been bought by outside firms.
Honeywell’s CEO made clear Friday that incentives are required for the move to go through. Thursday, state lawmakers approved a bill allowing the N.C. Department of Commerce to offer companies up to $16,000 for every job created. Currently, the limit is $6,500 per job.
The Senate unanimously approved the bill on Wednesday. But it ran into opposition from Republican Rep. Jonathan Jordan, who said the change would mean “more money to give to our corporate welfare programs and crony capitalism.”
Jordan fought over the bill with Rep. Bill Brawley, a Republican from Matthews who was one of the bill’s sponsors. The House approved it, and Cooper said he expects the bill to be signed and ratified in time for the state to formally approve the incentives package Monday.
Cooper said he didn’t know if the incentives package would be the biggest ever offered by North Carolina, but said it would be worthwhile.
“Yes it’s worth it, because we’ve done the economic analysis,” said Cooper.
Deon Roberts: 704-358-5248, @DeonERoberts