How Pennsylvania Lured One of New Jersey’s Largest Companies Across the Delaware

BURLINGTON TOWNSHIP, N.J. – Pennsylvania didn’t just land another corporate headquarters last week. It took one of New Jersey’s most recognizable Fortune 500 companies from across the Delaware River — and Gov. Josh Shapiro is making no secret of the fact that his administration went after the win.

When George Washington crossed the Delaware, it was to conduct a surprise raid on British forces in Pennsylvania. When Gov. Shapiro crossed the Delaware, it was to conduct a secret raid against New Jersey’s major industrial centers, except this time, it was done willingly.

Burlington Stores is leaving its longtime Burlington County headquarters for Philadelphia, where the company plans to invest $370 million and eventually employ as many as 2,000 people. Pennsylvania and Philadelphia put together roughly $38 million in financial support to help make the relocation happen.

For Pennsylvania Gov. Josh Shapiro, it is a major economic development victory. For New Jersey Gov. Mikie Sherrill, it is an early and highly visible corporate loss to a neighboring state led by a fellow Democrat.

Shapiro: ‘Pennsylvania Is Competing to Win’

Shapiro’s administration isn’t describing Burlington’s relocation as something that simply fell into Pennsylvania’s lap. Shapiro doesn’t care if his neighbor to the east is a fellow Democratic Party-led state.

It is calling it a win.

“Pennsylvania is competing to win — and today, we’re delivering a major win for Philadelphia and our Commonwealth,” Shapiro said while announcing Burlington’s move.

The governor said his administration deliberately uses public investment to make Pennsylvania more attractive to major employers.

“Our economic development strategy makes smart, targeted investments to make choosing Pennsylvania an easy yes for major companies like Burlington, create good-paying jobs in our Commonwealth, and strengthen our communities,” Shapiro said.

“It’s working — and we’re going to keep showing the world that Pennsylvania is open for business.”

Pennsylvania is backing those words with money.

The Commonwealth committed $30 million to Burlington’s project, including a $20 million Redevelopment Assistance Capital Program grant and $10 million through the Pennsylvania First Program.

Philadelphia assembled additional assistance, including a $7 million forgivable loan and transit support for Burlington employees.

The company will purchase 3151 Market Street in West Philadelphia for its new corporate headquarters.

Burlington CEO Says Pennsylvania’s Pitch Was ‘Extremely Compelling’

Burlington CEO Michael O’Sullivan’s own explanation shows that government policy was part of the company’s decision.

“We are very excited to be relocating our corporate headquarters to Philadelphia,” O’Sullivan said.

He said Burlington considered different locations as it searched for a new corporate home.

“We were strongly attracted to the energy, talent, and infrastructure that Philadelphia has to offer,” O’Sullivan said.

But the company’s CEO also specifically credited the political leadership on the other side of the Delaware River.

“We found the vision and priorities articulated by the Mayor and the Governor extremely compelling — fiscal health, education and training, and economic opportunity for all,” O’Sullivan said.

That is a difficult statement for New Jersey officials to ignore.

Burlington wasn’t merely offered office space in Philadelphia. Pennsylvania and city officials made a coordinated pitch backed by tens of millions of dollars and an economic development strategy designed to convince the company to move.

New Jersey Business Group Warns State Policies Are Part of the Problem

The New Jersey Business & Industry Association responded to Burlington’s departure with an unusually pointed warning.

“It is very sad that New Jersey is losing Burlington Stores, which is an iconic brand in our state named for one of our own municipalities, as well as another Fortune 500 company,” NJBIA President and CEO Michele Siekerka said.

Siekerka acknowledged that major companies relocate for many reasons.

But she said New Jersey should not dismiss the role its own policies play when employers decide where to invest.

“We cannot and should not ignore the impact our state’s tax policies and anti-business policies have on our overall competitiveness,” Siekerka said.

She also warned that the loss goes beyond the employees physically moving across the river.

“Nor should we diminish the loss of executive presence in our state, the number of new jobs that New Jersey will not have, and the amount of property tax lost from a 441,000-foot facility,” Siekerka said.

That gets to the larger economic issue facing New Jersey.

A corporate headquarters brings more than the jobs currently inside the building. It brings executives, future hiring, professional services, vendors, business spending and the possibility that future corporate expansion will happen nearby.

Once the headquarters moves, Pennsylvania becomes the home state competing for those future investments.

Sherrill Administration Admits New Jersey Is Too Hard to Do Business In

Sherrill’s administration did not try to pretend Burlington’s departure was good news.

The governor’s office said it was “disappointed by Burlington’s decision to relocate its headquarters.”

More significantly, the administration acknowledged the broader problem facing companies operating in New Jersey.

“Governor Sherrill has been clear that she is committed to making New Jersey the best place to start and grow a business, but right now, it is simply too hard to do business in our state,” the governor’s office said.

That admission puts Burlington’s departure into a much larger policy debate.

The Sherrill administration has identified lengthy permitting processes, complicated regulations and unnecessary delays as obstacles to investment and expansion in New Jersey.

Sherrill has said her administration wants to streamline permitting, increase government accountability and work more directly with businesses.

But Burlington made its decision now.

And Pennsylvania was ready.

Pennsylvania Is Actively Hunting for Corporate Investment

Burlington’s relocation matters because it isn’t an isolated Pennsylvania victory.

Shapiro’s administration has built its economic development strategy around aggressively competing for private investment.

“Pennsylvania is aggressively competing for, and winning, the biggest economic development projects in the country because we’re making strategic investments giving companies confidence that they will thrive here,” Shapiro said after announcing Burlington and other recent investments.

The administration says it has secured more than $43 billion in private-sector investment associated with nearly 29,000 jobs since Shapiro took office.

Some of those victories have come directly from New Jersey.

Eos Energy Enterprises moved its corporate headquarters from New Jersey to Pittsburgh as part of a major Pennsylvania expansion backed by state assistance.

Adare Pharma Solutions also moved its headquarters from New Jersey to Philadelphia with Pennsylvania economic development support.

Now Burlington joins that list.

The pattern gives New Jersey policymakers something larger to consider than one company’s relocation.

Pennsylvania knows there are major employers just across the river, and it has demonstrated that it is willing to spend money and actively recruit them.

Burlington’s Departure Hits Differently in Burlington County

There is an added sting to losing this particular company.

Burlington Stores opened its first store in Burlington in 1972 and has spent more than half a century tied to the community whose name it carries.

Its headquarters in Burlington Township made the company one of the most recognizable corporate names associated with South Jersey.

Burlington will retain substantial operations in New Jersey, including stores, warehouses and distribution operations. The company employs thousands of people across the state and has not announced an overall withdrawal from New Jersey.

But the headquarters is leaving.

Approximately 1,500 existing employees are expected to relocate to Philadelphia, with Burlington planning to add about 500 more as its Pennsylvania headquarters grows.

Those 500 future headquarters jobs are particularly important.

They are jobs that will now be created in Pennsylvania rather than New Jersey.

Sources: Pennsylvania Gov. Josh Shapiro; Burlington Stores CEO Michael O’Sullivan; New Jersey Gov. Mikie Sherrill’s Office; New Jersey Business & Industry Association.