The Government is providing “support” for the deal through its $26 million investment attraction fund, but won’t say how much money it is tipping in due to commercial considerations.
It says Boeing will create 250 new jobs over five years in a new Adelaide CBD office, including positions for project managers, systems designers, software engineers and researchers.
The new office, in Currie Street, will open over the coming week, with the Government promising the employees will work with universities, other tertiary institutions and research organisations.
In 2015, the Government claimed that Boeing would be ramping up its involvement in South Australia following the opening of its office in Mawson Lakes.
In response to questions from InDaily, the Government revealed that Boeing would close that office when its lease expires in a month. The fewer than 10 staff employed there will relocate to the CBD.
They will join five staff who will move to Adelaide from Boeing’s office in Brisbane, with the company to start recruiting for other positions “immediately”. The office will “support advanced military systems and leading edge research and development over the long term”.
A Government spokesperson said a “significant majority” of the positions would be “filled locally in South Australia”.
Under the deal, Boeing must remain in SA until 2026, the spokesperson said, “however we expect Boeing will remain in Adelaide far beyond that”.
Boeing is the world’s largest aerospace company. In January, it reported positive results for the final quarter of 2016, with the company predicting it would generate a record $US10.75 billion in operating cash this year.
Boeing has more than 3000 employees in Australia, across 27 sites.
In a statement, Premier Jay Weatherill said Boeing’s Adelaide expansion “demonstrates confidence in our state’s future”.
“Boeing’s expansion in South Australia will create opportunities for highly-skilled workers in the defence and research sector, with flow on effects to the supply chain and broader economy,” he said. “It also signals the increasing aerospace presence in South Australia.”
The Property Council said “chasing demand” was a common story in South Australia which needed to be continually addressed if the state wanted to improve unemployment and office vacancy rates.
“Putting to one side the size of incentive put to Boeing to look at Adelaide, this is good news for South Australia’s economy for many reasons, particularly for the CBD commercial office market,” said SA executive director Daniel Gannon.
“When new companies establish a footprint in the CBD they rent floorspace and contribute to the activation of their immediate area, which means supporting restaurants, cafes and other small businesses.”
He said the Property Council’s latest Office Market Report showed that Adelaide’s CBD office vacancy rate was well above the national average – 16 per cent compared to 10 per cent – and was at its highest level since 1999.
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