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Pharma Giant Teva to Move US HQ to Parsippany From Pennsylvania

Relocation to Bring More than 800 New Jobs to New Jersey
July 5, 2018
New Jersey Gov. Phil Murphy has scored a win in his quest to transform the state into a leader in technology and life sciences, with an international drug manufacturer committing to relocate its U.S. headquarters to Parsippany, NJ.

Murphy (D) on Thursday announced that Teva Pharmaceuticals USA, currently based in North Wales, PA, planned to expand its existing Parsippany location at 400 Interpace Parkway to nearly 350,000 square feet to establish its new headquarters and to consolidate operations. Teva, part of Teva Pharmaceuticals Industries Ltd., leases 115,000 square feet in Parsippany now, according to CoStar data.

The giant firm, whose global headquarters is in Israel, will transfer and create 843 jobs and retain 232 existing positions as part of the headquarters relocation, according to the press release from the governor’s office. The median annual wage for the more than 1,000 Teva positions is $128,073, according to the announcement.

The New Jersey Economic Development Authority (NJEDA) at its meeting last month granted Teva, which makes specialty and generic drugs, $40 million over a 10-year period to relocate its headquarters from Pennsylvania to Parsippany.

Teva now leases roughly 295,000 square feet at 1090 Horsham Road, North Wales, according to CoStar data.

"The presence of global life sciences companies like Teva Pharmaceuticals is critical to New Jersey’s ability to strengthen a thriving innovation ecosystem," Murphy said in a statement Thursday. "We are thrilled to expand our welcome to Teva, and its more than 1,000 employees, in the Garden State -- the place to be for the world’s most competitive life sciences companies."

The governor has been vocal in his bid to boost New Jersey's economy by attracting life science and tech companies. The Garden State is still home to many pharmaceutical company headquarters, although a few have downsized or departed.

In its application for NJEDA tax credits Teva said that it was weighing bringing its headquarter to Parsippany in Morris County or consolidating most of its jobs into its existing leased facility in Frazer, where it said it has space available to handle the added operations, noted EDA president and chief operating officer Tim Lizura in the memo. That would put more than 200 Teva jobs in Parsippany at risk, according to the NJEDA.

"While Teva will retain a significant presence in Pennsylvania, reducing the number of sites supports our drive to continue to improve productivity and efficiencies," Brendan O’Grady, executive vice president and head of Teva North America Commercial, said in a statement. "We’re pleased to expand our presence in New Jersey, having closer proximity to a vibrant business hub and a dynamic life sciences environment-all while increasing jobs and preserving many existing roles."

In Parsippany, Teva is a tenant at MCCBLUE, once called Morris Corporate Center III, a four-building campus with 541,466 square feet. Those properties were part of a portfolio that P3 Properties of Bloomfield, NJ, acquired for $60 million last December from JPMorgan Chase & Co.
See CoStar COMPS #4086771.

The Teva expansion will offer some small relief to the Parsippany office market, which has a 24.7 percent vacancy rate for Class A buildings and a 23.7 percent vacancy rate for all classes of office space combined, according to CoStar data.

Teva is getting its tax credits through the state's Grow New Jersey program.

"Nurturing the growth of strategic industry clusters is central to Governor Murphy’s mission of reclaiming New Jersey’s leadership in the innovation economy and strengthening the state’s economic competitiveness," Tim Sullivan, NJEDA chief executive, said in a statement. "Teva’s long-term commitment to New Jersey is the latest evidence of the enduring strength of our life sciences industry and New Jersey’s value proposition to the world’s leading companies."

Teva’s New Jersey move will entail a $31.5 million capital investment by the company, with a net benefit to the state of $247.4 million over 20 years, according to the NJEDA.

Linda Moss, Northern New Jersey Market Reporter  CoStar Group   
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