Pa.’s $10M helps AmerisourceBergen decide on new Conshy HQ, with 550 new jobs
Drug distributor AmerisourceBergen said Wednesday it is planning a new headquarters in Conshohocken, Montgomery County, and will move 1,500 bosses and staff from its former Chesterbrook headquarters and a smaller Conshohocken office into a new, 12-story, 427,000-square-foot tower.
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Drug distributor AmerisourceBergen said Wednesday that it is planning a new headquarters in Conshohocken, Montgomery County, and will move 1,500 bosses and staff from its former Chesterbrook headquarters and a smaller Conshohocken office into a new, 12-story, 427,000-square-foot tower.
Besides keeping current jobs in the state, AmerisourceBergen will "create more than 550" new jobs in information technology, accounting, and other central functions in Conshohocken by 2023, according to a statement from Gov. Wolf. Construction is scheduled to start this year and finish in 2020, the company said.
The building will anchor a long-planned redevelopment project by William Glazer’s Keystone Property Group between Fayette Street, the borough’s busy main drag, and Oak Street to the west, and from West First Street south to Elm. Keystone also plans two levels of underground parking, plus a plaza linking the offices to a proposed 130-room hotel, and a former firehouse where the developer wants a bar and restaurant.
Glazer called the project a "mixed-use town square" to link new construction along the Schuylkill to Conshohocken's store and office district. It will be called Sora West, for a bird that migrates up and down the nearby Schuylkill. Broker David Binswanger represented AmerisourceBergen.
Before choosing Conshohocken, AmerisourceBergen was also courted by New Jersey, which has offered multi-million dollar tax breaks to companies willing to move to former heavy-industry sites on the Delaware River waterfront in Camden, and Delaware, where developers and state officials were plugging former chemical and steel factory properties as office locations.
To sweeten the deal, the Wolf administration has approved $8 million in state-matching funds from the Redevelopment Assistance Capital Program "to assist with facility development and construction costs," plus $1.7 million in Job Creation Tax Credits when the company adds the promised new jobs. The package was assembled by the Governor's Action Team and staff at the Department of Community and Economic Development.
AmerisourceBergen employs about 21,000 people worldwide, including more than 1,000 in its Philadelphia-area offices and its Gloucester County distribution center. By growing in Pennsylvania, AmerisourceBergen will give a "significant boost to the regional economy," Wolf said, adding that such opportunities have been "rare" in the corporate sector. The Philadelphia area's largest employers are mostly hospitals and colleges. Merck, Vanguard Group, and Comcast are among the few locally based companies with 10,000 or more area workers.
The state said AmerisourceBergen has pledged to invest an additional $29.5 million or more in the new headquarters, one of several office projects that has transformed Conshohocken from a decaying industrial borough to a congested corporate headquarters, where streets of brick rowhouses now end in blocks of new riverside apartments popular with young working people. The borough is also accessible to Center City by SEPTA trains and the Schuylkill Expressway, and to Philadelphia International Airport, King of Prussia, and other locations off I-476.
AmerisourceBergen earned $364 million in profits in its last fiscal year, on revenues totaling $153 billion, most of which the company passed along to makers of drugs that the company sent to hospital pharmacies and other retailers. Along with rivals such as Cardinal Health and McKesson, AmerisourceBergen depends on government and employer health insurance drug coverage, including the expansion of Medicaid and individual insurance under the Affordable Care Acts in recent years.
AmerisourceBergen shares have risen and fallen with investors' perceptions of drug markets and medical payments, including the Trump administration's health-care policies, along with merger rumors. The company's largest owner is Walgreens Boots Alliance, which operates the drugstore chain. The stock has traded recently at about $85 a share, down from more than $100 in January.
Like other drug companies, AmerisourceBergen is a frequent target of government and private litigation alleging improper drug sales. The company and its rivals and suppliers have been sued by states and cities around the U.S., and is currently being investigated by federal and state officials including Pennsylvania Attorney General (and former Montgomery County commissioners' chairman) Josh Shapiro, for its role in the rapid rise in opioid painkillers, leading, as it has in the past, to abuse and deaths, killing more Americans last year than gunfire and car crashes combined.
AmerisourceBergen CEO Steven Collis has said in the past that patients and their doctors bear primary responsibility for painkiller decisions; the company has also donated to antidrug abuse groups.
Besides the Conshohocken project, Keystone owns suburban office parks in Montgomery and Delaware counties and has been adding apartments and retail space to the former Rohm and Haas and Curtis Publishing Co. headquarters buildings on Independence Mall in Center City.