From the Morning Call:
New York executives wooed by Wall Street West planners
Officials from 15 financial services firms attended a luncheon in Monroe County Tuesday to hear about a proposed office park that would house backup data centers.
The office park in Smithfield Township would be the first development in eastern Pennsylvania to target financial services firms as part of an initiative called Wall Street West.
Backup facilities would protect Wall Street financial firms if their main operations are knocked out by a disaster. The companies face a federal mandate issued after 9/11 to open parallel backup data offices outside Manhattan.
Nine counties in eastern Pennsylvania — including Lehigh and Northampton — are competing to recruit these firms. The state is promoting the region as a natural location for Wall Street’s backup data because it’s on a separate power grid and in a different watershed. It’s also more than 50 miles away from lower Manhattan, which is considered outside the ”blast zone.”
…
No company has announced plans to build an office park or a building in the Lehigh Valley dedicated to housing backup data centers. One information services firm did announce it will open a branch office here that will employ 10 people. Computer Network Solutions plans to build a data center here for its own use and for its financial services clients, which include the Bank of New York.
…
Wall Street West will clearly challenge parts of New Jersey that have gained thousands of financial services jobs since 9/11 and continue to recruit more. For example, Jersey City, which some also refer to as Wall Street West, stands to gain 2,400 jobs evenly split between Citicorp and Deutsche Bank next year. It’s also home to a 42-story tower that Goldman Sachs built.Parts of the region may also face a nagging image problem. In a segment on CNN Monday that described the Wall Street West initiative as based near Allentown, co-anchor Soledad O’Brien said, ”Allentown is a nice little town, but, boy, it is depressed.”
From the Philly Inquirer
Developer tries to bring Wall St. to the Poconos
http://www.philly.com/mld/inquirer/business/15727461.htm
A developer of custom single-family homes who has donated $56,000 to Gov. Rendell’s reelection campaign hopes to bring Wall Street to northeastern Pennsylvania.
The Rendell administration has pledged $30 million in low-interest loans and grants to the developer, Larry Simon, to help build the first of a five-phase, five-million-square-foot commercial development.
Simon will fund the development with state and private funds. Agreements with the state Department of Community and Economic Development require him to have 1,300 jobs in place to receive the bulk of the funding, said Dennis Yablonsky, the department’s secretary.
Federal regulators, with the experience of Sept. 11, 2001, in mind, are encouraging financial-services firms in large metropolitan areas to have disaster-recovery and backup centers at least 50 miles from their headquarters, but within 125 miles.
The state funds would help pay for infrastructure improvements to accommodate the developments. State and local officials say they are competing with Upstate New York, Connecticut and New Jersey in trying to lure the financial-services firms to Smithfield Township, in Monroe County.
Although this pertains to luring firms there, I know more than a few traders, comex&nymex, who live in the Pocono’s. They drive to Dover and train it in. Because of the trading hours, they are home between 3:30-5:30. They cringe with the thought of giving their $ to the state of NJ. Even if they are not successful in attracting these firms, the thought of moving there may be a more viable option as more and more are set up in their home office.
I honestly can’t see the Poconos or western Penn. picking up very much of the DR site business for Wall St.
I have no doubt that there are quite a few traders who live out that way but there are many more who are in NYC, LI, Conn. Should something happen in NYC serious enough to require you to head to DR this area would be inaccessible to most of the users.
The area would probably be fine for off-site storage/data retention facilities though.
On a related note, the Newark/Jersey City area picked up a lot of work after 911.Many comapnies were seriously considering keeping large portions of their back-office facilities and server-farms there, that is until the area got to be just as expensive as mid-town.
Since JC is within the NYC blast radius, would it even be an option?
jb
Well, the “blast radius” phrase is a bit melodramatic.
One of the Fed. requirements, as well as a good idea in general, is that the DR site be located on a different power grid from the primary site. That way power loss at the primary won’t affect DR. Jersey City is on a different grid than NYC.
To be honest if the Fed is requiring that DR planning has to account for the possibility of a nuclear strike I don’t think that there is anywhere on the eastern seaboard that’s going to be a good place.
I used to do a lot of work in DR planning up until about a year 1/2 ago, so they might have changed guidelines and requirements since then.
I’d love to know more if you have any more information on what the actual requirements are (or were).
jb
Look back at corporate cost migrations over the years. Valuable employees moved first, attempting a commute. People are the big cost and the big resource.
People start to despise the commute, and always seek to upgrade their
Here’s a link to the Reserve/SEC RFC, I can’t find the actual guidleines right now but this should give you an idea of where they were going.
http://www.federalreserve.gov/boarddocs/press/bcreg/2003/20030408/
“It’s also more than 50 miles away from lower Manhattan, which is considered outside the ‘blast zone.’ “
This has been raised here before; it’s practically an inevitability that NY City will be wiped out in the next decade or two.
Should be able to get some good housing bargains then…
This is on wsj.com. I don’t know if the link will work, and I don’t know how to navigate this new forum well enough to see if you’ve posted James. It’s short enough to copy and paste though.
http://online.wsj.com/article/BT-CO-20061012-710598.html?mod=hps_us_my_industries
FTC Takes Action Against 7 Real Estate Listing Services
DOW JONES NEWSWIRES
October 12, 2006 11:44 a.m.
By Mark H. Anderson
Of DOW JONES NEWSWIRES
WASHINGTON (Dow Jones)–The Federal Trade Commission on Thursday announced enforcement actions against seven real estate property listing services in six states, claiming the groups froze out their discount rivals.
The enforcement actions accuse the listing services of illegally restraining competition by denying home sellers who use discount brokerage services access to regional real estate listings controlled by major real estate companies. The FTC said that while the agency was announcing actions targeted at regional brokerage practices, it wants the national real estate industry to alter anticompetitive practices regarding the listing services.
“The rules these brokers made drove up costs and reduced choice for consumers, and they violated federal law,” said FTC Competition Director Jeffrey Schmidt, who added he wants to see nationwide industry steps on listing services. “The problem is the traditional brokerages trying to find ways to disadvantage new competition.”
The FTC said it reached consent agreements with real estate brokerage services in Colorado, New Hampshire, New Jersey, Virginia and Wisconsin. Two additional real estate groups in Detroit were also charged but didn’t settle with the agency.
The enforcement action seeks to level the playing field between traditional full-service real estate brokerages and a growing field of discounters, some based on the Internet, that offer more limited real estate services and typically charge lower prices.
The FTC said most of the brokerages charged Thursday refused to allow houses listed with discount services on regional multiple listing services from being transmitted to popular Internet house sales Web sites. One of the real estate groups blocked discount house listings from inclusion on the multiple listing services.
The consent decrees require the real estate groups to halt anticompetitive practices with their multiple listing services. The complaints against the two Detroit groups will go before an administrative law judge to resolve the charges.
-By Mark H. Anderson, Dow Jones Newswires; 202-862-9254; mark.anderson@dowjones.com
Jim,
I meet with eastern PA reps in planning and government as well as economic developers from PA. They are hungry for our people with a mostly progrowth agenda. This includes housing, they understand that economic growth comes from having a young population.
New Jersey has lost sight of this with most towns looking to squeeze out market based affordible housing by whatever means necessary. As I have said before zoning has been chhanged in many locales to reduce total # of housing units. Some towns have fought builders on the # of bedrooms that their townhouses can have in the belief that 3 bed rooms bring big families instead of 2 bdrms.
NJ municipalities are platying a prisoner’s dilemma game. Only everyone is in “defect” mode, that is non-cooperating. In essence the entire state is dysfunctional.
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