Liberty Mutual Insurance’s new Plano campus has been in the works for months and months.
As many as 5,000 jobs will be located in the Boston-based company’s planned Legacy business park office complex. The company confirmed the huge project just this week.
But for a long time, real estate brokers and economic development folks called it by the code name “Victrola.”
The code name for Toyota Motor’s headquarters move to Plano was “NOI.”
A new data center in Richardson for State Farm Insurance was labeled “project Black Flag.”
All that’s missing are the secret handshakes and midnight meetings in the high-stakes game of business moves. While it may sound silly to use made-up names and hide identities for companies coming to North Texas, the practice goes back decades.
When Exxon moved its headquarters from New York to Irving in 1989, the relocation was called “project Everglades.”
“We were thinking of a name, and about that time they found an alligator in Lake Carolyn in Las Colinas, so we decided it was like the Everglades,” said Paul Whitman, who heads the Dallas office of commercial property firm JLL and worked on the deal.Even after word starts getting out that a company is considering a relocation, businesses usually stay tight-lipped with the details.
“They have to keep it confidential, because if it gets out before the deal is finalized, it can cause major disruptions in their workforce,” said Bill Sproull, president and CEO of the Richardson Chamber of Commerce. “A leak before the deal is finalized undercuts the company’s negotiating position and can have political ramifications where they are coming from.
“I’ve seen situations where the identity of the company became public while the search was still going on, and it caused a major backlash.”
For sure, a company that’s after economic incentives doesn’t want it known they have made the decision to relocate an operation before the check is in the mail.And companies try to control when their workers find out about the potential for a move. “They want to be the one to tell their employees before they see it in the paper,” Sproull said. Of course, sometimes when a business says it’s thinking about making a move, they just hope to get a better real estate and economic deal where they are.In many cases they choose to stay put after testing the waters in North Texas.
“Everyone that is chasing these deals realizes that for every 10, if one, two or three relocate to Dallas it’s a win,” said Joel Pustmueller, one of the founders of Peloton Commercial Real Estate. “You still have to treat every one of these transactions the same and chase it hard.
“It’s the same thing for an office tenant that may or may not renew their lease and shops for space in other buildings.”
Regardless of whether a potential relocation is for real, real estate brokers are under the gun from their clients to keep the info under wraps. Most commercial property transactions come with nondisclosure contracts that could penalize a professional who spills the beans.
“Our clients are always concerned that information will get leaked before a decision is made,” said Johnny Johnson of the commercial real estate firm DTZ. “That’s particularly true for the larger and more sophisticated transactions that involve a lot of people.
“We are notorious in our industry for wanting to share information. But a deal isn’t done until it’s done, and the last thing you want to do is to say something premature.”