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NEW YORK CITY-In what a company spokesperson said was more of a real estate initiative than one geared at reducing corporate head count, Pfizer Inc. is consolidating operations into two contiguous buildings on East 42nd Street, while putting its 685 Third Ave. property on the market for sale.

Joan Campion, a spokesperson for Pfizer Inc., tells Globest.com that as part of the consolidation program an unspecified number of employees will be laid off or relocated from 685 Third Ave., to its headquarters building at 235 East 42nd St. or to operations it maintains at 219 East 42nd St. Some workers will also be relocated to Madison, NJ, Peapack, NJ, College Hill, PA and other Pfizer properties in New York.

It is believed that CB Richard Ellis has been given the assignment to market 685 Third Ave., a 650,000-sf building, for sale.

While reports have surfaced that as many as 1,400 Pfizer employees could be laid off or relocated, Campion infers that a majority of the workers will be relocated rather than terminated. While she could not provide specifics on the workforce reductions planned as part of the consolidation, Campion adds, “Most of the functions will most likely be transferred to other Pfizer locations, even if it is in another location in New York City. This is more real estate driven and square footage driven than workforce-related.”

The company currently employs approximately 4,400 in New York City. Pfizer acquired Wyeth Pharmaceuticals in January 2009 in a deal valued at about $68 billion. At about the time of the merger the company said it would reduce the combined company’s workforce, which stood at approximately 130,000 at the time, by approximately 15%. According to the company’s first quarter 2010 filing on May 4, at the end of first-quarter 2010 the workforce totaled approximately 113,800, a decrease of 2,700 from year-end 2009. The company stated in the filing, “Since the closing of the Wyeth acquisition on Oct. 15, 2009, the workforce has declined by 6,900, primarily in the U.S. Primary Care field force, manufacturing and research and development operations.”

The company also has operations in Pearl River, NY and upstate NY. Pfizer has reduced its workforce at the Pearl River property, the former headquarters of Wyeth, and at facilities in the Capital District of New York since the purchase.

Seven years ago, New York City Mayor Michael Bloomberg and then Governor George Pataki praised Pfizer’s decision to remain in New York City. The company at the time planned to retain its 5,500 workers in Manhattan and Brooklyn and spend $560 million to purchase and renovate 685 Third Ave. At the time, Pfizer said it intended to spend approximately $1 billion in New York City over the next 15 years.

For its commitment, the New York City Economic Development Corp. offered an incentive package valued at $46 million. Pfizer is believed to have utilized $12 million in the form of tax breaks from the city.

David Lombino, a spokesman for the NYCEDC, says, “A reduction in Pfizer’s New York City workforce resulting from their merger and restructuring would of course be disappointing, but we’re encouraged that they are choosing to maintain their global headquarters here and will continue to employ thousands of New Yorkers. Should the company reduce its workforce here below thresholds described in our agreements with Pfizer, we would certainly ensure that the city recovers the value of the benefits it gave the company to grow its workforce.”

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