UBS Buyout Impact

Publius on Topix (This guy knows his shit. Who is this masked man? It safe to assume he works in city government based off some of his insights he’s made there previously) has the best take I’ve seen on what the rumored UBS buyout could mean to Stamford.

The tax deals to bring UBS (and others) here do not hurt the city taxpayers. First, a good part of the difference is paid to Stamford by the state; that's why Moira Lyons was involved. Second, the portion of taxes Stamford receives from UBS today, even with the incentive, is considerably more than it was receiving from the Helco building, Rice School, and assorted auto sale and rental lots. And third, once the state tax deal ends, the city gets the full tax load from UBS.

IF UBS remains in that property the full tax amount will come to Stamford directly. IF UBS cuts back employees, it may still keep the property as is, or it may lease out portions, but it is the building that is taxed, whoever is in it. IF UBS leaves the city entirely, the chances are the building will be sold and marketed to someone else, and taxes still will be collected on it.

Worst case scenario: UBS leaves, the building is sold to a speculator and not fully rented. The tax incentive is gone, so the new owner has to pay full taxes. He appeals the assessment based on less than full occupancy, and gets a reduction in assessment....
And it is STILL more money in taxes than the City was receiving from the property before UBS bought it.

Now, there are other impacts if UBS leaves: what will it do to the housing and hotel market in Stamford, especially in the downtown? What will be the impact on employment opportunities?

OTOH, there are few buildings in the NY metropolitan area that offer as much space for a single company convenient to a major commuter and Amtrak station. There may be more than one company willing to take the building as is. The tax deals to bring UBS (and others) here do not hurt the city taxpayers. First, a good part of the difference is paid to Stamford by the state; that's why Moira Lyons was involved. Second, the portion of taxes Stamford receives from UBS today, even with the incentive, is considerably more than it was receiving from the Helco building, Rice School, and assorted auto sale and rental lots. And third, once the state tax deal ends, the city gets the full tax load from UBS.

IF UBS remains in that property the full tax amount will come to Stamford directly. IF UBS cuts back employees, it may still keep the property as is, or it may lease out portions, but it is the building that is taxed, whoever is in it. IF UBS leaves the city entirely, the chances are the building will be sold and marketed to someone else, and taxes still will be collected on it.

Worst case scenario: UBS leaves, the building is sold to a speculator and not fully rented. The tax incentive is gone, so the new owner has to pay full taxes. He appeals the assessment based on less than full occupancy, and gets a reduction in assessment....
And it is STILL more money in taxes than the City was receiving from the property before UBS bought it.

Now, there are other impacts if UBS leaves: what will it do to the housing and hotel market in Stamford, especially in the downtown? What will be the impact on employment opportunities?

OTOH, there are few buildings in the NY metropolitan area that offer as much space for a single company convenient to a major commuter and Amtrak station. There may be more than one company willing to take the building as is.

So even if the rumors of a UBS buyout are true, and they remain just rumors as of now, it won't necessarily bring the devastation of let’s say a sub base closing in Groton. It also seems unlikely a new owner would abandon a captial investment as large as the UBS HQ. Of it could be fire and brimstone coming down from the skies! Rivers and seas boiling! Forty years of darkness! Earthquakes, volcanoes, the dead rising from the grave! Human sacrifice, dogs and cats living together... mass hysteria!

Who knows.