The Memorial Bridge over the Piscataqua River, in Portsmouth.
Portsmouth and Nashua were named as two of the top 30 U.S. cities for the post-pandemic corporate headquarters following a site selection study by The Boyd Company, a firm specializing in business relocation.
With employees working remotely or in hybrid models in record numbers, more companies are transitioning to a hub-and-spoke model with one downsized central head office hub and additional smaller spokes—or satellite offices for administrative support, according to The Boyd Company. That means companies will be increasingly relocating to attractive, smaller market suburban locations offering lower operating costs, better state business climates and growth-oriented demographics to house their new downsized corporate headquarters, saving millions in annual operating costs and taxes, and placing them in a highly favorable recruiting position, according to the Boyd report.
John Boyd, a principle at the company, says NH fits well with the report’s model for what corporations are looking for today.
“You can see how New Hampshire fits into this [model] with its superior tax environment and the lack of a personal income tax,” he says. “This distinguishes New Hampshire particularly in the context of New England where you’re surrounded by high tax states. Massachusetts, of course, just passed its new millionaires’ tax.” (This is a tax of 4% on a person’s portion of income over $1 million.)
For its analysis, The Boyd Company study took into account post-pandemic remote working trends, state tax structures, operating costs, and growing fiscal and quality of life challenges for historic hubs such as Boston, Chicago, San Francisco and New York. The report’s cost analysis covers major cost factors critical to the corporate site selection process, including labor, real estate, construction, utilities, taxes and travel. Among the other cities included on the list were Mindon, Nevada; Ponte Vedre in Florida and East Brainerd, TN.
The proximity of Portsmouth and Nashua to health care, leisure activities and major airports were also important factors for being chosen, Boyd says. “Proximity to Logan Airport and Boston’s hospitality infrastructure has always been a business climate advantage for New Hampshire cities, but today it’s an especially strong asset,” he says. He adds that Portsmouth and Nashua are particularly well-suited locations for industries such as life sciences and health care because of their proximity to Boston. “One third of all office projects are life sciences, and the proximity to Boston and Cambridge, the nation’s epicenter in the health care industry, will create a lot of opportunities for both Nashua and Portsmouth.”
Portsmouth and Nashua fell in the middle of the list in terms of cost for construction of a new Class A, 75,000-square-foot corporate headquarters employing 200 administrative support workers. Annual operating costs for such an office in Portsmouth were $19,403,801 and $19,660,572 in Nashua. Portsmouth and Nashua also fall squarely in the middle when it comes to corporate tax rates and property tax rates. Quality of life factors play in favor of the cities and the ability to attract younger workers. “Post-pandemic trends have really impacted what a corporate headquarters looks like today,” Boyd says. “The idea of smaller real estate and markets are attracting young talent. This live, work, play narrative is really dictating where young workers are migrating to.” For more information, visit theboydcompany.com.