General Electric is getting $145 million in state and city grants and incentives to move its headquarters to Boston from Fairfield, Conn.
Massachusetts is also ponying up $5 million to build an “innovation center” that will foster collaboration with research institutions.
Not surprisingly, Massachusetts Gov. Charlie Baker, who worked with Boston Mayor Marty Walsh to make it happen, says it’ll be worth the investment.
“The payroll associated with this is $100 million to $200 million,” Baker told WBUR radio Thursday morning.
That means significant income taxes will flow into the state. More importantly, Baker said the presence of 800 GE senior managers and engineers means that the massive conglomerate’s customers, partners, and suppliers will also trek to the hub to do business, much as product manufacturers make the pilgrimage to Walmart’s Bentonsville, Ark., headquarters.
MORE: On GE’s move.
GE’s presence may even mean that its partners in various vertical industries will want to be in Boston too, Baker said, predicting a “tremendous ripple effect.”
WATCH: GE to sell most of its financial arm:
GE, founded in 1892 in Schenectady, N.Y., is the eighth largest company in the country. And it has a history of building big industrial gear, but is now trying to remake itself as a builder of innovative software along with jet engines, transformers, and appliances.
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It is even building its own “industrial cloud” that it wants to sell to other manufacturers, including competitors.
In the high-tech sphere, it’s hard to overstate GE’s importance. It is the reference customer that all tech companies want to claim.
And claim it they do. GE (ge) executives show up at Amazon (amzn) Web Services, Microsoft(msft), Oracle(orcl), Pivotal, and other events to talk about how they’re using their hosts’ products. Well, GE owns a stake in Pivotal, so that’s a slightly different story.
The presence in the Boston-Cambridge area of satellite offices for all those tech companies was probably another draw for GE.
Still, the fact that Boston was able to pull this over the goal line was somewhat surprising. Locals are wary of anything that smacks of a giveaway to corporate interests. Boston’s bid for the Summer Olympics last year is a perfect example. The bid was made, then pulled, in the face of massive public resistance.