NU Online News Service, Feb.12, 11:41 a.m.EST

Liberty Mutual together with Boston Mayor Thomas M. Menino andstate officials announced today that the company plans an expansionof its Boston headquarters that will create 1,100 new jobs.

If local government authority approvals are secured, the projectwould get a tax break of more than $15 million.

The mayor's announcement said the project will add 600 newfull-time positions with the company and the work on a property itpurchased will mean 500 construction jobs.

According to the company the expansion activity should generatemore than $50 million in new tax revenue for the city.

Liberty Mutual said that it had opportunities to expand in otherparts of the country, but ultimately decided that Boston providesthe best opportunity for its growth. The insurer added thatanticipated total investment of approximately $300 million in itscorporate headquarters would make Boston one of the largestinsurance hubs in the country.

"Putting people back to work is a top priority," Mayor Menino'sstatement said. "Creating new jobs--600 permanent and 500construction jobs--as local unemployment numbers are at an all timehigh is my focus. Liberty Mutual and the insurance sector representa $3.2 billion industry that is critical to Boston's economicgrowth."

Edmund F. Kelly, Liberty Mutual Group chairman, president andchief executive officer, said, "We thank Mayor Menino, GovernorPatrick and their staffs for working so hard and creatively withLiberty Mutual to make this investment in Boston and its futureeconomically attractive."

"We are eager to continue our collaboration with Mayor Menino,the City of Boston and Liberty Mutual to bring this expansionproject to fruition," said Massachusetts Secretary of Housing andEconomic Development Greg Bialecki. "Growing jobs is the number-onepriority for the Patrick administration, and this partnership is agreat example of creating employment opportunities for hundreds ofpeople."

For its expansion, Liberty Mutual recently acquired twobuildings in the city--the former Salvation Army building and theBenjamin Franklin Smith building, which are located adjacent to thecurrent Liberty Mutual home office campus at 175 Berkeley Street.The former Salvation Army building previously generated no taxrevenue for the city, the company noted.

It was explained that the city is utilizing Tax IncrementFinancing (TIF) for the project, which allows it to provide aproperty tax exemption for a portion of the new value created bythe project.

The exemption, worth $16 million, would phase in over atwenty-year period as the new property is developed. The city wouldreceive a net benefit of an estimated $50 million in new taxrevenues over the same period.

The Boston Redevelopment Authority will vote on the TIFagreement at its board meeting on Tuesday. The agreement must alsobe approved by the City Council. Liberty Mutual will then need toapply to the Massachusetts Economic Assistance Coordinating Council(EACC) for designation as a certified project.

"Liberty Mutual's expanded and integrated downtown Boston campuscan't come soon enough for our residents who work in the buildingtrades, said John F. Palmieri, Boston Redevelopment Authoritydirector. "With unemployment rates up to 50 percent in parts of theconstruction industry, we must find ways to put these men and womenback to work."

The BRA is in the midst of conducting a planning study for theStuart Street area. Liberty Mutual has been an active participantin the process and any new development that they propose willreflect the Stuart Street guidelines, which are currently in draftform.

In order to move forward with the redevelopment, Liberty Mutualwill need to go through the Article 80 development review process, which includes communityreview, and receive BRA approval.

Liberty Mutual, founded in 1912, has more than 4,100 employeesin Massachusetts located at 31 offices across the Commonwealth. Thecompany has more than 2,500 employees located at its home officecampus in Boston.