RYE BROOK, NY-ITT Corp. spinoff Xylem Inc., which had been considering relocating to Connecticut, has decided to remain in Westchester County and has signed a lease for more than 67,000 square feet here.

The water technology company, which is currently based at 1133 Westchester Ave. in 50,000 square feet of space, signed a 10-year lease for 67,145 square feet at 1 International Drive in the Reckson Executive Park in Rye Brook. The company went before the Westchester County Industrial Development Agency on Feb. 7 and told the IDA it had accepted its incentive package and would be signing a lease in Rye Brook. However, the company refused comment at that time and did not confirm it was remaining in New York State or relocating to Rye Brook.

The lease deal was announced by both New York State’s Empire State Development and Westchester County. Empire State Development is providing Xylem with $1.35 million in Excelsior Jobs Program tax credits and a $1-million capital grant. The Westchester County Industrial Development Agency approved $562,000 in sales tax exemptions for the new space. Construction will begin in the second quarter of 2013, with the move expected to be completed in the fourth quarter of this year.

“We are thrilled that Xylem will be expanding its world headquarters in Westchester County,” Westchester County Executive Robert Astorino said in a statement. “These are good jobs, hi-tech and eco-focused jobs, and we’re proud to have partnered with Xylem to keep these jobs here. The county continues to work hard to provide an environment where companies like Xylem and others can grow for the future.”

Xylem President and CEO Gretchen McClain adds, “Our new, expanded space will be a modern, world-class headquarters designed to encourage collaboration and training, as well as housing an innovation center. We expect the building to be a source of pride for our employees who work here, as well as for many Xylem employees from all over the world who come here for training and meetings.”

Xylem has approximately 12,700 employees worldwide and generated $3.8 billion in revenues in 2012. The company was created after ITT, which is headquartered at 1133 Westchester Ave., spun off its water business in October 2011. As a result, federal regulations required Xylem’s headquarters to be separate from ITT’s.