Executives decide to move their corporate headquarters for a number of reasons. Some choose locations they believe will appeal to top talent. Other relocations closer to transportation hubs to make business travel simpler and cheaper, while still others shift locations to take advantage of attractive financial incentives like tax breaks.

To help keep you ahead of the trends in corporate relocations, we’re highlighting the “why” and the “where” of recent corporate relocations. We’ll start by showing you the factors in today’s business environment that are motivating these companies to move. Then, we’ll highlight four trending U.S. destinations for corporate relocations, including who’s moved recently—and why.

If you’re looking to relocate your headquarters, these trending locations may give you some new ideas as you investigate potential new home cities. Or, if you’re helping a customer with their relocation, keeping an eye on these trends will help you better anticipate your customers’ needs, including where their relocations might take you.

Why Do Companies Choose to Relocate?

On the face of it, relocating an entire headquarters might seem like an expensive decision for any company. In addition to moving the organization’s physical operations, a relocation also means moving the company’s employees, which can add up quickly.

However, a relocation can make a lot of financial sense, especially when it comes to these four areas:

#1: Consolidating Multiple Locations

In some cases, a relocation may be a move to save money, especially when it means consolidating multiple facilities. For example, when Toyota relocated to Plano, Texas in 2017, they moved a number of departments—sales, manufacturing, customer service, finance and engineering—to a single location. The decision united employees who were formerly located in California, Kentucky and New York under a single roof.

#2: Attracting Key Talent

Millennials continue to shape the job market, including influencing the locations of corporate headquarters. Increasingly, companies are looking to establish themselves in areas that offer the kind of lifestyle that young, talented workers are looking to embrace. Competition for talent continues to be tough, which means that expenses in recruitment and retention continue to rise. By choosing a location that’s attractive to potential and current employees, an employer could save money in the long run when it comes to hiring top workers and keeping them on board.

#3: Cost of Living

In a similar vein, companies are increasingly looking to markets that offer a reasonable cost of living. Whereas employees may struggle to purchase their first home in the Bay Area, a city like Nashville, Tennessee can offer housing prices that are much more attractive to first-time buyers. The promise of a sustainable lifestyle has proven to be important to both current and potential workers, giving employers yet another edge in the area of recruitment and retention.

#4: Easier and Cheaper Air Travel

By locating headquarters near travel hubs, companies can improve their efficiencies and expenses around corporate travel. When packaged foods company ConAgra decided to move their headquarters from Omaha, Nebraska to Chicago, Illinois in 2015, they cited the availability of non-stop international connections from Chicago’s O’Hare and Midway airports as a prime motivator.

#5: Financial Incentives

The frenzy of offers around Amazon’s recent HQ2 search shows just how willing local jurisdictions can be to offer companies incentives for relocation. Atlanta offered the company $2 billion of taxpayer-funded incentives. Boston offered zero-interest loans to help employees with down payments on their homes, among other benefits. Chicago dangled the possibility of $400 million in infrastructure spending. Ultimately, Amazon chose Crystal City, VA, which proffered $2 billion in subsidies for the privilege of hosting the company’s second headquarters.

Now that it’s clear why and how a relocation can offer a company significant benefits, let’s take a look at some of the hottest spots for corporate relocations in the U.S.

#1: Austin, Texas

austin texas

Why Austin?

Over the last few years, Austin has been evolving from a city that hosted an eclectic population with a thriving music scene into a hub for tech companies. Increasingly, companies are relocating to Austin from California to take advantage of the city’s quality of life, lower cost of living and reasonable housing prices.

Key Statistic:

In 2018, the Austin Chamber of Commerce recorded 46 relocations to the Austin area, which translated into 9,424 new jobs in the city that year.

Companies Who Have Made the Move:

Zoho, a tech company that offers cloud-based business software including CRM, email and more, purchased 375 acres of land in South Austin in 2019.

DISCO, a cloud-based legal document management service, will bring more than 150 jobs to the area as a result of its relocation.

Apple, Amazon, General Motors and Google also made recent expansions in the city.

 

#2: Chicago, Illinois

Why Chicago?

Site Selection magazine named Chicago the top metro area in the nation for corporate relocation and investment for five years running. Access to a talented pool of labor, a central location within the U.S. and the proposed expansion of O’Hare airport all have made Chicago an attractive location for corporate headquarters. Additionally, with a median home cost of $229,100, as compared to $1,378,300 in San Francisco, Chicago offers an attractive locale for employees who are looking to put down roots and become homeowners.

Key Statistic:

As evidence of its deep talent pool, consider the fact that Chicago hosts the second-highest concentration of computer science graduates in the United States.

Companies Who Have Made the Move:

Caterpillar, the construction machinery manufacturer, recently moved its operations from Peoria to Chicago. Their new location sits minutes away from O’Hare airport, likely to allow for easier access to overseas clients.

Additionally, McDonald’s moved its headquarters to Chicago from Oakbrook, as part of a move to update its brand image.

Les Mills International, a New Zealand-based fitness brand, will be closing its Baltimore and San Francisco offices and consolidating its U.S. operations in Chicago.

 

#3: Denver, Colorado

denver corporate headquarters relocation

Why Denver?

An affordable cost of living, a large pool of college talent to draw from and vibrant, outdoors-focused culture have made Denver an attractive locale for many companies. As with Austin, the city has also been attracting a number of tech companies, who see it as a place where they can pursue sustainable growth.

Key Statistic:

The Colorado Office of Economic Development approved $27 million in tax incentives for VF Corp, the parent company of outdoor brands like The North Face, Eagle Creek, Smartwool, and JanSport, to move its global headquarters to Denver.

Companies Who Have Made the Move:

Niceland Seafood, an Iceland-based sustainable seafood company was attracted to Denver for its focus on healthy living and environmental sustainability, as well as its direct flights to Iceland from Denver International Airport.

HomeAdvisor, an online marketplace for home improvement services, relocated from Golden, Colorado to Denver’s hip River North (RINO) neighborhood.

Slack, an instant messaging platform for corporate teams, opened a new location in Denver in July 2019. The company has additional office locations in New York, Vancouver, London, Toronto, Dublin, Melbourne, and Tokyo.

 

#4: Nashville, Tennessee

nashville corporate headquarters relocations

Why Nashville?

In 2018, U.S. News and World Reports ranked Nashville as one of the top 20 places to live, citing its strong job market and quality of life for its residents. Large financial companies are increasingly choosing Nashville, likely because the city has boasted the second-lowest costs in the country for these types of businesses. When considering labor, real estate, utility, and tax costs, a financial back-office in San Francisco might cost a company $13.6 million, as compared with $10.3 in Nashville.

Key Statistic:

18 Fortune 1,000 companies are headquartered in Tennessee.

Companies Who Have Made the Move:

Money management firm AllianceBernstein announced plans to open an office in Nashville in 2018. The city won out over its second-place contender: Charlotte, North Carolina.

JPMorgan Chase & Co. expanded to Nashville in 2011, as did UBS in 2014.

In addition to the financial companies moving to Nashville, other industries have also found the city attractive. SmileDirectClub, a teledentistry start-up, added an additional 2,000+ jobs to its Nashville headquarters in 2019.

 

Spotting Trends in Corporate Relocations

As you’ve seen in this article, the right location for a corporate headquarters can make a world of difference to a company. In addition to financial incentives, an attractive locale can also help recruit and retain key talent, simplify corporate travel and reduce costs across several different expense categories.

By understanding the “why” and the “where” behind corporate relocation trends, you’ll be better positioned to make the right decision for your company as they consider relocating. Or, if you’re in the business of helping these companies make their moves, you’ll be ready to anticipate their needs and assist with a seamless transition.

 

Whether you’re a corporation looking to relocate or a moving company who needs a hand relocating your customers, we can help! With tens of thousands of moves under our belts, we create seamless transitions for companies and employees alike. Just get in touch with us for a complimentary consultation.