The Bank of Nova Scotia, operating as Scotiabank, expects to bring its new U.S. regional hub to Dallas after the state stepped up with more than $10.7 million of economic incentives less than a week after the city of Dallas made its own offer.
The Toronto-based bank with about $1.4 trillion Canadian dollars in assets expects to create over 1,020 new jobs and invest more than $60 million U.S. dollars into a new Dallas office that will serve as its newest U.S. hub. The Texas Enterprise Fund, the state's deal-closing economic incentive fund, has offered about US$10.7 million to Scotiabank for the new regional office, the governor's office said Tuesday.
The offer comes on the heels of Dallas leaders approving an offer of more than US$2.7 million in economic incentives and a 10-year tax break for Scotiabank to create a roughly 100,000-square-foot regional office at last week's city council meeting. As part of the incentive package, Scotiabank received a Texas Enterprise Zone designation.
“Today's announcement marks a significant investment and commitment in Scotiabank's U.S. operations and reinforces our longstanding presence in Texas where we have been operating since the 1960s,” Scotiabank CEO and Global Banking and Markets Group Head Travis Machen said in the statement from the governor's office.
“We are proud to expand in Dallas with a best-in-class regional hub that fortifies our role at the core of the North American corridor, a crucial gateway for trade and business, while also deepening our commitment to the local communities," Machen added.
Scotiabank did not immediately respond to an emailed media request from CoStar News seeking additional comment. The bank was considering Charlotte, North Carolina, along with Dallas, in its real estate search for a new U.S. office, executives told Dallas city council members last week.
The decision by Scotiabank comes as Dallas has been beefing up its financial services industry, with the new office expected to be blocks from a new $500 million, two-building campus being constructed for Goldman Sachs in the city, where it is on track to increase its current regional head count from about 4,600 employees up to more than 5,000 employees when the hub opens in 2028.
Like Scotiabank, Goldman Sachs was also offered economic incentives to solidify its decision.
The addition of Scotiabank adds to Texas being a "new financial services capital" in the country, said Gov. Greg Abbott in a statement, adding that this move ensures a prosperous future for the state for decades to come.
The new office could add more than 1,000 jobs at an average salary of at least US$135,000, with at least 25% of those jobs going to Dallas city residents, according to a proposal outlined to city leaders.
Dallas Mayor Eric Johnson said in the statement he was thrilled to welcome Scotiabank to Dallas as the newest "Y'all Street" company. The term "Y'all Street" is a playful nickname for Dallas as it has become a major U.S. financial powerhouse like New York's Wall Street.
Site Selection Group Senior Partner Kelley Rendziperis said it appears Scotiabank has accepted the economic incentive offers from Texas and Dallas, with the city offer preceding the state's offer.
"One of the requirements of the Texas Enterprise Fund is that there's a local commitment," said Rendziperis, who sits in the firm's Austin office, saying she wasn't surprised with how quickly the deal unfolded. "As it relates to North Carolina, I imagine they definitely had the ability to compete for the project, but their offer may not have been reported."
One of the last financial services companies to be awarded a Texas Enterprise Fund grant was Charles Schwab for its headquarters relocation from California. The $6 million award, disbursed in July 2020, was for the creation of 1,200 jobs and a capital investment of at least $100 million by Charles Schwab, according to public records.
Rendziperis said it is difficult to compare awards from the Texas Enterprise Fund; however, part of the equation is tied to the delta between the average salary of the jobs and average county wage. Scotiabank's promised high wages likely factored heavily into the equation, she added.