Bridgestone Americas is preparing to relocate its headquarters to a new 30-story tower south of Broadway, provided that Metro Nashville and state officials approve a package of incentives that would make the tiremaker one of the largest private employers in downtown Nashville.
The relocation, which officials announced Tuesday after a brass band intro, would bring 1,700 employees, including 600 who are out-of-state, into downtown Nashville. Billed as one of Nashville’s most significant economic development announcements in years, it would continue a development boom that has transformed the SoBro neighborhood.
There would be a taxpayer cost as well. The transaction is contingent on $50 million in Metro incentives and an undisclosed package from the state that, according to sources familiar with the deal, is comparable to the city’s commitment.
If the deal is approved, Bridgestone will move its corporate headquarters near the airport to a new $232 million building at Fourth Avenue and Demonbreun Street, just a few blocks from the city’s arena, which has the Bridgestone name as a corporate sponsor. The company would also transfer employees from three existing Bridgestone divisions — including ones in Bloomingdale, Ill., and Carmel, Ind. — to Nashville. The building is expected to open in 2017.
Employees at affected Bridgestone offices were notified Tuesday of the impending moves.
Mayor Karl Dean, who has increasingly turned to incentive-based deals to lure companies to Davidson County, compared the city’s push to a baseball team’s effort to keep its star free agent.
The announcement followed trips by both Dean and Gov. Bill Haslam over the past year to Tokyo — home of Bridgestone Corp., which is the parent company of Bridgestone Americas.
In orchestrating the deal, Metro and state officials were faced with determining what it would take to lure the out-of-state Bridgestone divisions, but also keep one of Davidson County’s largest employers from leaving.
Three cities, including Nashville, were in the final running for the headquarters.
“The truth was this was incredibly competitive,” Haslam said. “There were two other headquarters locations it could have gone, but every other major city in the U.S. battled hard for this.
“Our secret weapon was all the existing Bridgestone employees who didn’t want to go anywhere else.”
The incentives pledged by Dean and Haslam clinched the deal. Metro would give Bridgestone a 100 percent abatement of real property tax payments for 20 years, beginning in 2018. In addition Metro would give the company a $500 per employee credit for all new employees into Davidson County over a seven-year period. Both incentives need Metro Council approval.
State officials declined to reveal their commitment at this time. But according to sources, it includes a $15 million first-year payment, as well as future tax breaks that would put the total investment at about the same level as Metro’s.
“As you can imagine, we were aggressively courted by several major cities,” Bridgestone Americas President and CEO Gary Garfield said. “In the end, Nashville stood out as the place for Bridgestone to be.
“We’re excited to make SoBro the home for Bridgestone Americas for a very, very long time.”
Bridgestone Americas currently occupies nearly 90 percent of its 282,101-square-foot building at 535 Marriott Drive in Donelson, where its lease expires in 2017.
The new deal will create a landmark new addition to Nashville’s skyline.
Bridgestone is set to be the lone tenant of the 500,000-square-foot tower that developer Highwoods Properties is planning to build at Fourth Avenue and Demonbreun Street next to the Encore condo tower. The 30-story building would rank as one of downtown’s tallest office towers.
It will help anchor a neighborhood that has some of downtown’s most noteworthy buildings, including the Music City Center, Schermerhorn Symphony Center, Bridgestone Arena, the Country Music Hall of Fame and Museum, Omni Hotel and the Pinnacle at Symphony Place.
Metro’s involvement comes a year after the city committed $66 million in incentives, primarily through property tax breaks, to lure hospital giant HCA and two of its subsidiaries to a new North Gulch site off 11th Avenue North. That deal served as a model for the Bridgestone package.
Only HCA — which is expected to bring 2,000 new jobs to downtown over time — would employ more people in downtown Nashville than Bridgestone. Other top downtown Nashville employers are: ServiceSource, with about 1,000 employees; UBS, with 1,240; and Lifeway, with slightly less than 1,110.
“This is a huge win for Nashville,” said Courtney Ross, chief economic development officer of the Nashville Area Chamber of Commerce. “Bridgestone is a globally recognized brand that plays a vitally important role in the Nashville region’s economy. Today’s announcement means Bridgestone will continue to play a role in Nashville’s growth well into the future.
“This project of course sends another strong signal about the strength of the Nashville business climate and its economic vitality.”
Highwoods, the Nashville-area’s largest office landlord, recently purchased the roughly 1-acre future Bridgestone site from Tony Giarratana.
The new 30-story tower, which will include street-level retail, would be about the same height as the Pinnacle, located just a block away.
RESTAURANT COMING? The building will include up to 7,700 square feet of retail space to which Highwoods intends to attract a high-end restaurant.
FLIGHT PLANS: Several other major Metro cities with direct flights to Japan competed for Bridgestone America’s headquarters. “Nashville really was head and shoulders above them when you look at things like cost of living, quality of life, taxation,” said Christine Karbowiak, executive vice president of Bridgestone Americas, adding the company also looked at other sites around Middle Tennessee.
Still, Rob Wigington, president and CEO of the Metropolitan Nashville Airport Authority, said the announcement adds more momentum for eventually attracting direct overseas flights. “The more they grow here, the more it’s going to build the case for nonstop service to Tokyo,” he said.
MORE THAN TIRES: The retail, roofing and industrial products business units that Bridgestone is relocating to Nashville generate $6 billion in annual revenue. It also includes the leadership of the retail group, which includes 2,200 company-owned stores.
UPGRADES: Restriping and other improvements are planned to streets such as Fourth Avenue South and Molloy Street, based on recommendations of a traffic study. “The great thing is we’ve got a lot of people who live in Lebanon, who live in Mt. Juliet, and so the Music City Star is right there,” Karbowiak said, referring to the train’s downtown stop.
MUSIC NOTE: During the event, Mayor Karl Dean revealed that Bridgestone Americas has committed to donating $150,000 a year for five years, or $750,000 overall, to Metro School’s Music Makes Us program.
Reach Joey Garrison at 615-259-8236 and on Twitter @joeygarrison. Reach Getahn Ward at 615-726-5968 and on Twitter @Getahn.