Manufacturers, biotech and pharmaceutical companies, food processing and distribution plants and various technology firms: What do they all have in common? They have all signed deals to either come to New Jersey or expand their operations here since the COVID-19 pandemic broke out in the state. And they all are based internationally.
While the pandemic has severely slowed the economy in the state and the country, it has not lessened companies’ interest in coming to New Jersey.
In fact, Choose New Jersey CEO Jose Lozano said the interest in the state has never been higher. In a cruel irony, the pandemic that has crunched the state’s own economy appears to have helped its profile internationally.
“International companies always have wanted and felt they needed to have a presence in New York City; our job always has been to show them they derive the same benefits — and do so at a lower cost — here,” he said. “They are seeing that now.”
They are seeing it because they are concerned about office life — and commuting life — in a post-pandemic world, Lozano said.
“What we are pitching is a proximity to the city, but in a place where you can spread out a bit more — and potentially not have to use mass transit,” he said. “It’s all about having horizontal instead of vertical properties. And we have a lot of those.”
Lozano said the state is not allowed to formally name the companies — due to nondisclosure agreements. But ROI-NJ was permitted to view company names, locations and the number of jobs associated with the deals.
The number of employees ranged from as few as three to as many as 200. Lozano said he is confident the state will ink deals with bigger players as the summer goes on.
“By fall, I expect to have a few deals that will bring as many as 1,000 employees to the state,” he said.
Thus far, the companies coming in have been a close split between international (12) and domestic (nine). Lozano said he expects the number on the international side to grow more quickly this summer and fall.
One key reason: Pharma and medical supply companies are realizing they need to have production and distribution centers in the U.S. (see full story here) to be better prepared for the next event that slows the distribution pipeline.
“Based on what we consider the pipeline, almost three-quarters of the companies we’re having conversations with about coming to New Jersey right now are international,” he said. “I have never been more optimistic about our ability to attract international companies. By the end of the year, I suspect we’ll have a lot more deals on that side of the ledger.”
Lozano also is confident about domestic interest in the state — particularly from New York City. Interest is there, he said, but those moves are more likely to come further down the line.
“There are a lot of New York City companies whose leasing is expiring in one, two or three years who are reaching out to us,” he said. “There’s not a lot of buyers, but a lot of looking. Remember, it’s only been about 100 days since COVID exploded here.”
Lozano said the state is getting interest from companies looking to take temporary space so they can test out the market.
“We’re getting a lot of cold calls from New York City companies who are saying, ‘What do you have?’” he said.
A lot of those calls, he said, are coming from the outer boroughs — which suddenly may not seem so fashionable.
“We’re getting a lot more calls from Brooklyn, Queens and the Bronx than Manhattan,” he said.
More importantly, Lozano said, he’s hearing from companies that have offices in both New York City and New Jersey that are looking to expand their New Jersey presence because of what they are hearing from their employees.
“We’re hearing that companies who have two offices are getting more requests to work out of the New Jersey office,” he said. “Especially those employees who have been commuting from New Jersey.
“Companies realize expanding their New Jersey presence now may help them with retention down the road.”
Lozano said he’s encouraged by the residential market, which is booming.
“Everyone has always wanted to have a NYC address, but now they are saying, ‘We just want to be close to New York, but have a lot more space’ — a lot more horizontal space,” he said. “People are showing that they want to move out of the cities. We think smart companies will follow.”