Athenahealth accepts incentives deal, picks Austin for expansion

Athenahealth Inc. said Friday it has chosen Austin for an expansion of its research and development operations, and plans to create more than 600 jobs at the former Seaholm Power Plant building on West Cesar Chavez downtown.

The announcement came after the Austin City Council late Thursday approved $679,500 in incentives over 10 years for the Massachusetts-based heath information technology firm, which also will receive $5 million from the state.

“We’re thrilled to be growing our presence in Austin, a city with a culture and vibe that perfectly aligns with our own,” said Jonathan Bush, chairman and CEO of Athenahealth. “Athenahealth is growing all across the country as we work to fulfill our vision of becoming a national information backbone to make health care work as it should… Austin’s dynamic talent pool, combined with the fantastic support from Gov. Rick Perry and his team, as well as from the City of Austin, has made us already feel at home. We’re inspired to make Austin a hub for the important work we do to advance connectivity in health care.”

Athenahealth has said the jobs — most of them to be hired locally and many of them high-paying software developer jobs — will pay an average annual wage of $132,085. The city said its incentive package — which is equal to $250 per new full-time job, per year — will result in a total net benefit to the city of $1.67 million.

Athenahealth said it will make a total capital investment of $13 million in its new R&D center, which will be a 110,000-square-foot facility at the Seaholm redevelopment project. The company plans to hire 607 employees over the next 10 years, in addition to relocating its existing 36 Austin employees at Seaholm.

Athenahealth previously said sites in Georgia and Massachusetts were in competition with Austin for the center.

The Austin City Council voted 5-2 to approve the incentives, after Council Members Laura Morrison and Kathie Tovo and some residents questioned why the city needs to spend public dollars to lure companies, when Austin’s economy is among the best-performing in the nation.

Mayor Lee Leffingwell said the city’s share was “a relatively token amount” to leverage the $5 million in incentives the state was offering.

Holly Spring, director of communications for Watertown, Mass.-based Athenahealth, said the company “couldn’t be more enthused” about building on its presence in Austin as the fast-growing company expands its national footprint.

“We currently have U.S. offices in Massachusetts, Maine, Alabama, California, North Carolina, Georgia, New Jersey, and Texas,” Spring said. “Austin offers Athenahealth everything we could ask for in a city. It’s among the top tech hubs in the country and provides an unrivaled culture of innovation, creativity, and talent.”

Athenahealth provides cloud-based services to health providers to manage medical records, billing, patient communications and other functions electronically.

Software, computer systems design and related services is a sector that employs over 25,000 in Austin and that has seen local job growth of 15 percent in the past year, chamber officials said. At least 15 companies in Austin employ more than 1,200 in developing software for health care provider.

“Athenahealth is a noteworthy addition to the growing list of innovative life science companies that have chosen to invest in their success in Austin,” Leffingwell said. “ I look forward to the company’s continued growth and success in Austin during this exciting time for our region.”

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