M&T Bank Corp. keeps filling up more office space and increasing its job count in the region, without much attention.
In the latest example, the bank will lease about 25,000 square feet at AppleTree Business Park in Cheektowaga. The bank will have seats for 179 technology-related employees and will fill them with a mix of existing M&T workers and new hires. Employees will start working there in June, said Keith M. Belanger, M&T’s senior vice president and manager of corporate services.
M&T’s job growth hasn’t come in a single dramatic swoop, like the fanfare around SolarCity’s factory, but it is no less significant. The bank now employs about 7,000 people in its nine-county Western New York region. Nearly 97 percent of those jobs are in Erie County.
“This is a market where the real estate cost is reasonable, there’s a great talent base in Western New York to tap,” Belanger said. “Keeping your teams together is a positive thing, not having them all spread out.”
The bank’s total head count in the region – in corporate offices and branches – has grown by 475 jobs since the start of 2015, up by 7.3 percent in a 16-month span. At the bank’s recent shareholders meeting, M&T chairman and CEO Robert G. Wilmers noted that the bank’s workforce in the area was more than 2½ times as large as it was 25 years ago, and that M&T has tripled its use of downtown office space. Across all its operations, M&T has more than 17,000 employees.
M&T is adding financial services jobs at a time when there is plenty of anxiety locally about how KeyCorp’s planned acquisition of First Niagara Financial Group will shake out. Cleveland-based Key is expected to cut overlapping jobs at Buffalo-based First Niagara. In March, the Buffalo Niagara region had 34,300 financial activities jobs – a category that includes banking – which was up about 10 percent from five years ago, according to state data.
The planned Key-First Niagara deal has also raised questions about how much office space the combined bank will need in Buffalo Niagara. First Niagara’s headquarters in Larkinville has fueled that neighborhood’s ascent.
Meanwhile, as M&T has grown – most recently by purchasing New Jersey-based Hudson City Bancorp – so have its employment needs at its home base. The financial services industry seems to have insatiable hiring appetite for tech-savvy personnel, as banks keep up with regulators’ compliance requirements and customers conduct more business electronically. Belanger said the bulk of the bank’s “noncustomer-facing” employees – that is, people who don’t work in locations such as branches – are based in Western New York. And with good reason.
M&T calculated occupancy costs for its offices in Western New York, Baltimore and New York City, to compare the annual expense of the real estate in which its employees work. The figure took into account costs such as rent, taxes, insurance and utilities, but not employees’ salaries.
M&T determined that its annual occupancy cost per employee seat in Western New York was $3,254, compared with $9,669 in Baltimore and $43,215 in New York City.
“It’s a real driver for us to house staff in this region, and part of what’s making us as successful as we are, because it’s allowed us to kind of keep the bank together, where there’s good communication between the various business groups,” Belanger said.
Those kinds of numbers, he said, are kind of a “leading indicator” for site selectors who compare different markets for business clients, he said. “Salaries are higher in those other regions, and health care costs are higher in those regions, and everything else,” he said.
Even though the numbers favor Western New York, Belanger said, finding quality office space in the region that fits the bank’s criteria can be challenging. Sometimes the solution is in the suburbs – such as AppleTree, where the bank was a tenant years ago – and sometimes it’s downtown.
Last summer, M&T leased nearly 13,000 square feet at the former AM&A’s warehouse on Washington Street. And now that Hiscock & Barclay moved out of space that it had leased in M&T Center, down the street from the bank’s headquarters, the bank is renovating the law firm’s space and creating room for 300 employees.
Not all of the office improvements that M&T is making are focused on space that the bank has just taken control of. Belanger estimated that M&T has spent $15 million to $20 million a year on its Western New York facilities in recent years.
M&T leases about 41 percent of the 1.3 million square feet of corporate office space that it occupies in 12 facilities in the region, and owns the rest of the space. The bank’s hunger for more office space benefits property owners and managers.
“It’s good to have a quality tenant of that stature back with us” at AppleTree, said James F. Dentinger, president of McGuire Development, the property’s leasing and asset manager. He said AppleTree had what M&T wanted: a large floor plan, with ample parking. In turn, he said, securing the bank as a tenant could help AppleTree attract others. “Like anything else,” Dentinger said, “new deals bring momentum.”