Foot Locker could create $18 million in St. Pete salaries

City Council members approved an incentive package to help ensure Foot Locker selects St. Petersburg as its next corporate home in the brief window between Hurricanes Helene and Milton.

The council voted 6-2 to provide up to $475,000 to the Fortune 500 company at an Oct. 3 meeting. Footlocker announced Aug. 28 that it planned to relocate its global headquarters from New York City to St. Petersburg.

Brian Caper, economic development director, said the sports apparel conglomerate will choose one of two potential office buildings in north St. Petersburg’s Gateway Area by the end of 2024. He expects Foot Locker to put $20 million toward capital improvements.

“I look at the return on investment – a $475,000 investment for the job incentive package, but then a total of a $37 million economic output of the job creation and economic incentives,” said Councilmember Brandi Gabbard. “I mean, the math doesn’t lie.”

Caper believes employees will begin relocating next summer, and the new headquarters should be operational by fall 2025. “Obviously, by putting this timeline in their pre-application, they’re feeling pretty bullish about the way they’re going to move forward,” Gabbard said.

The local incentive package requires the retailer to create 150 net new jobs with an average annual salary of at least $120,000 annually. Caper said that would directly generate $18 million in new earnings.

He said those jobs would also have an indirect economic impact of $5.04 million. Caper explained that Foot Locker would use about $14 million of its $20 million capital improvement investment to purchase “equipment and tangible personal property.”

Foot Locker already operates an office in the Franklin Templeton building at 140 Fountain Pkwy. The company currently leases 147,000 square feet of space for its Manhattan headquarters.

Caper called Foot Locker the “leading footwear and apparel retailer,” with approximately 2,500 stores in 26 countries. He said city officials have included the $475,000 in the economic development department’s operating budget.

The company can receive up to $235,000 in job creation incentives by meeting wage metrics that will likely increase with inflation. Caper noted Foot Locker could accrue another $240,000 by hiring employees from the South St. Petersburg Community Redevelopment Area.

He said the retailer would fill a “wide range” of roles locally, from entry-level analysts to senior leadership positions. Salaries will start at roughly $50,000 and increase to over $300,000 annually.

While the company has 10 years to meet those requirements, Caper said administrators “fully expect they will do that much sooner.”

Council Chair Deborah Figgs-Sanders noted Foot Locker could keep the $235,000 base incentive and not hire any South St. Pete residents.

She also worried that the distance between South St. Pete and the Gateway area could present a hurdle. “How are they going to get to work?” Figgs-Sanders asked. “I hope we will provide some type of transportation for them to ensure they’re successful.”

The incentive package could include up to $100,000 in annual property tax abatement for a decade. Caper said Foot Locker’s leadership would present a formal application for the council’s approval once they select a site and complete capital improvements.

Councilmember Richie Floyd called the economic development agreement corporate welfare. He said the funding is “crumbs compared to what they’re going to save on real estate costs in Manhattan.”

“I do think what you put together is relatively reasonable,” Floyd added. “I just see it as a fairness thing, democratically and economically. There are great people who move to the city every day … We don’t provide anything to them.”

Councilmember Lissette Hanewicz expects some residents to disagree with the city’s economic impact estimates. However, she also noted they voted to provide ad valorem tax exemptions for new and expanding businesses in 2022.

“I feel comfortable that the majority of our citizens, based on the referendum and what we’ve done in the past, are fine with this,” Hanewicz said. “But I do want – there has to be more clarification and holding people’s feet to the fire.”