NHV Battles NYC To Land Corporate HQ
by Paul Bass | Jun 18, 2014 12:01 pm
Posted to: Business/ Economic Development
Barry Berman is shopping for a new home for his fast-growing radio and social-media marketing company. His hometown hopes he’ll land here.
Berman (pictured) would like to move the company, CRN, to New Haven if he can. But New York City beckons too.
Each city has its advantages.
Meanwhile, the state is trying to sweeten the deal so that CRN’s taxes and 70-plus jobs, now parked in Hamden, stay in Connecticut.
“It would be nice to be in New Haven,” Berman said. “I love New Haven. I live in New Haven.” He said he expects his workforce to continue growing.
Whether CRN ends up here will test the city’s, and the state’s, ability to attract and keep new-economy jobs, as well as its ability to compete with the Big Apple.
City Economic Development Administrator Matthew Nemerson has been showing Berman’s crew different sites in and around downtown for months. “We are very motivated to get them into New Haven,” Nemerson said. “It’s a perfect company in terms of having a global clientele and young employees who would otherwise to go Brooklyn.”
The state Department of Economic & Community Development has been negotiating with CRN on terms of a partially forgivable low-interest loan for a New Haven move.
“We’re still in negotiations,” said DECD spokesman David Treadwell. He wasn’t specific about terms. According to city economic development email correspondence released under the Freedom of Information Act, a previous agreement with the state had expired and had to be renegotiated.
Berman founded CRN as the Connecticut Radio Network in 1973, offering ski reports to radio stations. The ski reports went national (yes, even Birmingham, Alabama, wanted to hear about Vail and Aspen), with Maxwell House signing on as a sponsor. Over the years the company kept growing, and morphed a media-marketing company, its name changing from Connecticut Radio Network to CRN. It now specializes in radio and social-media marketing; its clients include heavy-hitter companies like Microsoft, Johnson & Johnson and Chrysler. Since 1989, CRN has been headquartered in a 1929 former bank building at the confluence of Dixwell Avenue, Circular Drive and Putnam Street in Hamden.
It has outgrown that space. And its work now requires a closer connection to New York City, both to host clients as well as to tap into the “creative economy” workforce and broader community “knowledge base,” Berman said.
“Hamden is a little bit difficult to recruit New York talent. We need very specialized access to New York or quick access to New York,” Berman said.
On the one hand, a New York headquarters would place CRN right in the midst of that media marketplace.
On the other hand, It’s possible, with the new train station on State Street and the development going on around downtown, that New Haven is accessible enough.
“Do we keep developing our resources in New York? Or do we make a stand here?” Berman remarked. “We turn people over. We have people who have been with us for 20 years or plus. But where we’re at now is that Hamden is a little bit difficult to recruit New York talent. We need very specialized access to New York or quick access to New York.
“New Haven offers us that kind of nice compromise. Our creative director used to come from New York; he lived on the Upper West Side. He came from one of the big agencies there. He drove. It wasn’t as accessible to take a train into New Haven and then to cab it over here.”
And New York real estate is far more expensive than New Haven’s, Berman noted. “We can’t buy the Empire State Building,” Berman noted.
Theoretically, CRN can buy a “landmark” property in New Haven. If it can find one.
It started looking several years ago. Serious discussions ensued about CRN occupying a five-story building at the corner of State and Orange as part of the 360 State St. residential tower complex. Then 360 State got into a dispute with the city over taxes, and talks broke down.
CRN recently renewed the search. Among the buildings it has seriously looked at is the Exchange Building, the stately 1823 Greek Revival building at 123 Church St. (pictured), on the corner of Chapel. The Annie E. Casey Foundation abandoned the building in 2013; downtown property owner Paul Denz snapped it up for $2.7 million. (Read about that here.)
According to Nemerson, those talks hit a snag over whether CRN would rent or own; he said Denz was reluctant to sell. Denz did not respond to repeated requests for comment.
So Nemerson and CRN have been looking elsewhere in town, too. CRN continues looking at sites in New York too.
“We’ll get ‘em,” Nemerson vowed.
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Great story. This shows just how far New Haven has come in the last 20 years. In the 90’s, the idea of New Haven competing with New York for anything would have been laughable.
With ESPN, NBC and other stuff in Stamford, Connecticut has a decent “media” cluster and New Haven is well-positioned within it. People can bounce between jobs.
That said, NYC offers absolutely unparalleled opportunities if you are trying to create a massive technology- or media-centric company and have the money to do it.
NYC is growing quickly, with a 15% job growth rate from 2000 through the recession even as job growth in NYC’s suburbs (NJ/CT/LI) has been flat. The reasons are pretty clear - 1) you have an overwhelming share of talent within highly-specialized fields like media in one geographic place, and 2) young people can’t afford to own and operate cars. But at some point, NYC will get too expensive and some of the companies that are growing there will need to move out.
With today’s technology, a studio can be anywhere and talent can be located anywhere. CRN could partner with a studio in NYC or establish a small footprint with a booth, while establishing its main presence elsewhere. New Haven would be cheaper than NYC, yet offer direct transportation when that is preferable to a remote.
Denz seems be a major player here. That is really good news for Denz bank account.
I wish the best of luck to this firm as it looks for downtown offices.
On a less cheery note, is it unfair that I feel like every time I hear about Paul Denz the news is bad? Doesn’t he own the burnt-out empty undeveloped properties behind Church and Chapel? The properties that keep that block of Chapel from improving? He owns the most-blighted facade downtown, the hideous wreck on Church across from the old mall? The property that keeps that block of Church from improving?
Now he is keeping one of the most important downtown office properties vacant, in the face of interest from an important tenant?
Is that unfair?
It is great that Berman has been to grow his firm. But it is unwise for cities and states to engage in bidding wars to attract new firms, a zero-sum game. One thing the state could do is to persuade MetroNorth to run more trains to State Street station. This would make the city more attractive for firms and for individuals who work in Fairfield County or New York.