Wall Street Job Exodus Grows as AllianceBernstein Move Leaks
(Bloomberg) -- New York’s hold on finance and investing jobs keeps slipping.
AllianceBernstein Holding LP is moving its corporate headquarters and about 1,050 jobs from the city known for Broadway shows to one more famous for country music. The company will begin moving workers to Nashville in 2018, and eventually plans to relocate finance, legal, and sales and marketing teams, among other functions, according to a filing Wednesday. The firm’s portfolio management, sell-side research and trading, and New York-based private wealth management businesses aren’t moving.
Even as JPMorgan Chase & Co. plans a new headquarters on Park Avenue, some big banks and money managers are shifting resources by hundreds or thousands of miles to cheaper U.S. cities. In recent years, Goldman Sachs Group Inc. has built up operations in Salt Lake City, while Deutsche Bank AG has expanded in Jacksonville, Florida. Pacific Investment Management Co. just chose Austin, Texas, for a new office as the asset manager seeks to recruit tech workers and broaden marketing in the U.S.
Last year, relocations contributed to the first decline in New York City’s securities workforce since 2013. That left the industry with about 176,900 people in town, or 6 percent fewer than before the financial crisis, according to the state comptroller’s office. The rest of the private sector grew by 23 percent over the same span.
AllianceBernstein Chief Executive Officer Seth Bernstein will be among those making the move, the Wall Street Journal reported late Tuesday. The firm considered as many as 30 cities -- examining attributes including housing, cost of living, education and weather -- before making its pick, the Journal said.
In addition to cutting costs, the move was prompted in part by lower state, city and property taxes in Tennessee compared with the New York area, the Journal reported, citing unnamed sources and a staff memo.
Jonathan Freedman, a spokesman for the asset manager, didn’t respond to a request for comment.
Tennessee Governor Bill Haslam and the state’s Department of Economic and Community Development invited media outlets to an event the state capitol at 10 a.m. local time to unveil a “significant economic development announcement.” The advisory doesn’t provide details on which company is involved.
Money managers are under increasing pressure to reduce their spending as investors focus on low-cost mutual funds and other products. Among actively managed funds, only the most inexpensive are luring new money, the Investment Company Institute said in a report this week. AllianceBernstein has been no exception. In the first quarter of 2018, the asset manager had net outflows of $2.4 billion.
AllianceBernstein has been consolidating office space to reduce costs. In an October conference call with investors, the firm said it had vacated a floor at its Midtown headquarters, 1345 Avenue of the Americas, to market it for sublease, a move that was expected to produce savings of $3.6 million a year.
The firm has roughly 3,500 employees globally and manages about $550 billion in assets.
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