Geez, more bad vibes and now someone wants me to move to Houston!!

Hello all,

In reply to what I thought was a simply stated opinion of the importance of the health and education industries to our economy, and particularly to our commercial office space market, I received another bad vibe letter from one Scooby Doo. Now you know I don't have too much time for the bad vibes people. They tend to live by the creed "if it ain't broke, break it."

Now, I will take my lickings from someone debating the relative merits of our cities, be it New York, Chicago, LA, or Altoona. Each has its own style, its own strength. But please don't challenge Boston against any city when it comes to healthcare and then don't finish your bad vibes point by shooting yourself in the foot complaining about Boston's mutual funds industry. That's like me, a 5' 11" washed up hockey player, taunting Kevin Garnett to "show me whatcha gut 'fore I embarass your a..s" Not smart.

Anyway, this is what Scooby Doo wrote verbatim:

"Scooby Doo has left a new comment on your post "The Influence of Educational Institutions on Bosto...":

Whose going to pay the taxes ? The Medical and Educational sector are usually non-profit.

When i travel thru the Longwood Medical Area i cringe - Boston really needs to get it's act together and coordinate the planning for the entire medical area. Pedestrians can barely cross the street, traffic lights are not coordinated. Have you ever been to the Texas Medical Center in Houston. Send some of the planning genius's down there to learn something. I am tired of business as usual here in Boston, one day we will wake up and Fidelity will be headqurtered in Providence !!


And hear is when I decided to bring in not only a few drones but, what the hell it is Texas right, the full artillery. There was no need for detention centers. I think I left no survivors. Enjoy.


Scooby Doo,

I am not sure what you mean with regard to taxes. If you are referring to property taxes, it is true that non-profits do not pay tax on their property. However, in Boston, all of the major health institutions reach agreements with the City to pay "in lieu of taxes" when, by purchasing a private property, removing the property from the real estate rolls.
If you are talking about income taxes, you are also correct. However, by law, non-profits do not distribute profits to private individuals. All money is returned to the balance sheet.

What you truly fail to see is that the explosive growth in the Boston medical world, and the growth has always been explosive, has resulted today in over 385,000 jobs in the healthcare industry, the bulk of which are in Boston.

I do admire the Texas Medical Center. It reminds me a bit of NASA. Lyndon Johnson made sure Texas "won" the big prize for location but then NASA staffed the entire operation with MIT professors, students, and related companies. Read the details on Apollo 11. The guys coming up with a way to make a vent out of toilet paper, a rubber hose, and a white sock were all from Cambridge.

In 1900, Galveston was destroyed and Houston was, more or less born. By 1905, after Spindletop, Houston's population had reached a whopping 44,600. In 1900, the population of Boston was 620,000 with a metro population of 1,196,000. Mass. General Hospital was celebrating its 99th anniversary. Of course, Harvard Medical School was celebrating its 122nd.

My point is simple. The reason Longwood drives you crazy is because it is organic; it grows in and around itself. So does Mass. General, Tufts Medical Center, and Boston Medical Center. These were already dense neighborhoods when tumbleweeds rolled down the streets of Houston. We never got a chance at a master plan. Please keep your Texas geniuses in Texas.

But let's get to the heart of the matter. Boston has 227,000 employees in the healthcare industry. With a metro population of 5.7 Million, that's a ratio of 1 healthcare employee for every 25 people.

Houston not only has fewer health employees, at 219,000 but, considering Houston has a metro population of 9.8 million; there is 1 healthcare employee for every 45 people. Not quite the coverage one gets in Boston.
Let's look just at physicians and surgeons. Boston alone has 6,380 physicians; Houston has 4,530. Ratios: Boston: 1 per 897 residents; Houston: 1 per 2,177. I know where I want to live when I have a heart attack.

The average healthcare professional in Boston earns $78,770 per year. In Houston, the figure is $65,630. You know what they say about money and talent. Now do we really want to count the number of students in medical school? Do we really want to count the pure scientific medical research community, such as the Joslin Diabetes Center? Trust me we don't.
My point, Scooby Doo, is that income taxes generated by the sheer number and wages of Massachusetts health care workers eliminate whatever concern you have about taxes.

I see you mentioned Fidelity. I know them well. Boston, after only London, is the 2nd largest city IN THE WORLD in assets under management. I'm in real estate so I'll use real estate as my reference. Sticking with Fidelity, let's consider the mutual funds industry. First, Fidelity can move its headquarters anywhere it wants to. The problem is that none of its analysts will go there. They'll just walk down the street and work for any of the 25 other mutual funds in Boston. Ned just likes to make what he thinks is a scary threat every few years while he dines with his daughter daily right on Water Street, after he steps out of the same office as his father did.

Back to the facts, the mutual funds alone occupy 37% of the Class A market. That translates to over 14 million square feet of occupied space. Fidelity occupies 1.9 million square feet. They are smaller than State Street Global at 2.6 million square feet. If Fidelity packed up all its bags and left, Boston would still be the largest city in the U.S. in assets under management.

Sometimes business as usual is the envy of many, many cities. But you can always try Providence!