District Mayor Muriel Bowser announces two big incentive packages this week, for the parent company of the Washington Wizards and the Advisory Board Co. (Photo by Bill O’Leary/The Washington Post)

The Advisory Board Co. plans to move from the District’s West End to a newly developed office building planned for 655 New York Ave. after agreeing to a city package of hiring incentives worth as much as $60 million.

D.C. Mayor Muriel E. Bowser (D) said Thursday that the deal would generate $300 million in total net tax revenue, five times the incentive package. She announced it the day after celebrating plans for a new entertainment venue and basketball practice center for the Washington Wizards that will cost another $50 million in taxpayer funds.

Virginia Gov. Terry McAullife (D) made his own efforts to attract the Advisory Board in order to fill Arlington County’s largest office tower, 1812 North Moore. The building has been empty since its completion almost two years ago.

Bowser said as a member of the D.C. Council until this year she had “seen suburban jurisdictions poach D.C. businesses for far too long.”

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“We have taken the approach that we are going to be at the table for every one of these deals,” she said. “We’re going to fight for our companies. But more than that, I’ve asked the deputy mayor to even cast the net wider, so we’re in a position to attract companies from around the region and up and down the East Coast and quite frankly across the country.”

Bowser will submit the Advisory Board package for approval to the D.C. Council, where members may question whether the costs of the deal are worth the returns.

A $2.4 billion business, the Advisory Board specializes in providing technology, research and consulting services primarily to health care and higher education clients, with a dozen offices on three continents.

D.C. is where the Advisory Board was founded, has operated for 35 years and where its chairman and chief executive, Robert Musslewhite, lives. Like other firms before it, it plans to depart the West End for a new building in Mount Vernon Triangle near dozens of restaurants, shops and other amenities.

Of the company’s nearly 1,900 local employees, 865, or 48 percent, live in the city, compared to 38 percent in Virginia and 14 percent in Maryland.

“The percentage of our workforce living in D.C. has increased every year the past five years,” said Michael Kirshbaum, the company’s chief financial officer.

Bower’s incentives are contingent upon the company’s continuing to grow and hire in D.C. In each of the first 10 years of the 16-year lease the company negotiated, the Advisory Board will have to add a net 100 new D.C. residents as employees in order to receive a $6 million tax incentive. By the 10th year, the company will need to have 1,865 D.C. residents to receive the full $60 million.

Advisory Board officials said they were expecting to hire aggressively because of their growing health care and education businesses, industries coping with rapidly changing regulatory environments.

Musslewhite said that although in some ways it was difficult to picture leaving D.C. given the needs of his workforce, the company considered options around the country

“We are a public company and we have to be a prudent steward of financials, so that was a very important consideration. Certainly a project like this would not have happened,” without the intervention of the mayor, Musslewhite said.

“The package that we’re looking at here and the way that it’s been structured helped the District meet the bar” and beat out other places like Virginia, he added.


The Advisory Board plans to move to 655 New York Ave. NW., a project planned by Douglas Development. (Rendering courtesy Douglas Development)

Bowser said that on top of the jobs and the tax revenue the city could potentially reap, the company had agreed to spend 35 percent of its budget for building new office interiors on small- or minority-owned D.C. businesses.

“We’re serious about creating pipelines for work, for good-paying jobs,” she said.

Council member Jack Evans (D-Ward 2), chair of the council’s finance committee, compared the package to one the city approved for LivingSocial, which at the time was a fast-growing daily deals company.

But LivingSocial’s fortunes changed and the company began laying off staff, leaving it unable to qualify for any of the incentives. The Advisory Board is moving into a building, by Douglas Development, that LivingSocial executives closely considered leasing during its growth period.

Evans recalled previous efforts to land corporations, including Northrop Grumman, when he felt the District was not given a fair crack.

“Now we can get in the game and compete to win,” he said.

Follow Jonathan O’Connell on Twitter: @oconnellpostbiz