A Pittsburgh real estate information company that received a state grant to expand its work force could be asked to repay the money following a series of layoffs that have crushed any hope of meeting its promise to the state. National Real Estate Information Service, based in Kennedy, informed the state Department of Community and Economic Development in early December that it would fall significantly short of creating 1,105 jobs before its year-end 2007 deadline.
Three years ago, National Real Estate struck a deal to create 1,105 new jobs and retain 467 of the jobs it already had. Kevin Ortiz, a spokesman for the DCED, said the company in December reported it had a total of 934 employees. "The consequences could be potentially having to repay some of the money provided to them, but that decision has not been made," Mr. Ortiz said. National Real Estate President Michael E. Forgas had no comment.
National Real Estate is a provider of settlement services for the prime and subprime mortgage markets, which thrived on creative financing options during the real estate boom. During its heyday in 2003, the company paid $3.85 million for the purchase and renovation of the 96,900-square-foot former GlaxoSmithKline consumer health-care headquarters next to its old location to make room for expansion. But its fortunes fell as the subprime industry deteriorated and eventually collapsed.
When National Real Estate failed to meet its hiring goals in April 2007, the state gave the company a deadline extension until the end of the year. Under the terms of the agreement National Real Estate struck with the state in April 2004, the DCED would provide a financial package worth $3.2 million, which included $2.2 million in job creation tax credits, about $500,000 in customized job training and a $500,000 opportunity grant.
National Real Estate would not have received any of the tax credits or job training money until after the jobs were created. Since that hasn't happened, the only money the company would potentially have to reimburse the state is the $500,000 opportunity grant. The company announced it was laying off 108 workers in September due to the national foreclosure crisis. Reportedly, another round of company layoffs occurred in mid-October.
Source: Post-Gazette.com