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BCR's Daily Fishwrap Report for January 11, 2011

Red Hat to stay in Wake County

Reports started coming in this morning that a big job announcement was on tap in Govenor Perdue's schedule for the day. 

Sources including the N&O and WRAL reported that Red Hat was likely to stay in the Triangle, with a tweet from the Governor's office stating that this afternoon's job announcement is big news for Wake County.  The news is especially good for Wake, which will lose some jobs to Duke Energy's acquisition of Raleigh-based Progress Energy.

Red Hat, a supplier of Linux software and support, boasts 3,600 global employees, with approximately 700 currently located in Raleigh.

News of Red Hat's potential move to Durham first emerged here at BCR in October.  Reports state that many sites were in the running, including several corporate parks in Raleigh.  Jim Goodmon had placed his American Tobacco Campus in the running, with rumors indicating that his proposal centered around a new tower sited to the north of Diamond View II.

Other cities, including Austin and Atlanta, were in the running as well. Cost-of-living and quality of life concerns were stated as driving forces to stay in NC.

When all was said and done, Red Hat decided to stay (almost) put.  Red Hat will be building a new headquarters in Wake County.  The actual location has yet to be determined, but Red Hat representatives confirmed that they will stay in Wake.

Today's announcement came in the wake of a decision to give $18 million in state incentives for Red Hat to stay in NC.  In order to secure state incentives, Red Hat has pledged 540 new jobs in North Carolina.

Expect to hear more as the news develops.


Kevin Davis

Update: the folks at Ambacco just put forth the following press release, jointly sent from ATC's Michael Goodmon and the Durham Chamber's Casey Steinbacher. A classy way to exit:

"We at American Tobacco and the Durham Chamber of Commerce are happy that Red Hat, one of the Triangle's leading companies, will remain in the Triangle.

We thank Red Hat's leadership team for inviting us to respond to the company's RFP and for visiting downtown Durham and considering the hub of innovation that has taken root here -- a hub that includes such organizations and resources as Burt's Bees, Digitalsmith, McKinney, PocketGear, the American Underground, Bull City Forward and, soon, HTC.

Finally, we salute the Durham community -- from its public servants to its marquee companies to its many entertainment destinations -- for coming together so seamlessly to pursue Red Hat and other premiere businesses. We have all made a friend in Red Hat."


I'm really glad that Red Hat decided to stay in the Triangle (although I would have preferred that they pick the ATC site). However, the $18 million incentive sticks out to me: If I'm interpreting this right, 540 jobs (over nine years) = $33,333 per job, or a $5/sf/year subsidy based on their projected office space of 400,000 sf over that same 9 years. I'm sure there are a lot of other local companies who could some of that these days.

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