The move of about 700 executives and corporate support employees for the global telecommunications giant will begin in a few weeks and finish by early next year. About 5,300 jobs will stay in San Antonio and the city will remain the headquarters of AT&T Telecom Operations for 22 states.

Company executives said getting closer to the telecom technology hub of Dallas and access to more direct flights were the key reasons for moving AT&T’s head office.

“We’re a growing global company with customers and operations around the world,” AT&T CEO Randall Stephenson said in a statement. “Being headquartered in Dallas will benefit our long-term growth prospects and human resources needs, and our ability to operate more efficiently, better serve customers and expand the business in the future.”

The company made other executives available when the San Antonio Express-News requested to interview Stephenson.

The fact that significant jobswould remain here was little consolation Friday for San Antonio leaders.

AT&T • AT&T to relocate headquarters; most jobs staying | KENS video • Lack of direct air connections cited as key reason for decision | KENS video • David Hendricks: AT&T helped make S.A. what it is today • City officials surprised by announcement of the corporate departure • Saddened Whitacre says: 'It's a big loss' KENS video: Judge Nelson Wolff surprised, sad about AT&T move KENS video: AT&T employees shocked by move EN video: Chamber's Richard Perez reacts EN video: County Judge Nelson Wolff reacts • DallasNews.com: AT&T moving headquarters to Dallas from San Antonio • Press Release: Announcement from AT&T • Forum: Share your thoughts on telecom giant AT&T leaving San Antonio for Dallas. • Clocking In: Reaction to move • At Large: More bars in Dallas • Why the company moved San Antonio in 1992 • AT&T's corporate history • List of other corporations that moved headquarters from San Antonio More stories about AT&T AT&T Stock Chart Recent stock price More information about AT&T stock Stock quotes: AT&T Corporateweb site: AT&T

“There was no inkling” a move was possible, County Judge Nelson Wolff said. “Everybody is just shocked, just like me.”

Local government and economic development officials had no hint such a move was imminent. The AT&T board of directors approved the move Friday morning after executives studied the idea for several months.

But as the company grew and longtime CEO Ed Whitacre retired, the new leadership began exploring another move.

“San Antonio is a wonderful city, but it can be a difficult place to get to and fly out of,” said Jim Callaway, AT&T senior executive vice president of executive operations.

The move is likely to ripple throughout the San Antonio economy.

High-end houses will glut the market as executives put their homes up for sale.

Fewer high-profile executives will be available to serve on nonprofit boards and help fill the coffers of groups such as United Way of Bexar County.

And the city will lose the cachet of having a high-profile corporate headquarters.

“It’s devastating. A headquarters operation not only has a huge multiplier effect, it provides leadership in your community and it’s a high-profile factor in your business recruitment activities,” said Mario Hernandez, president of the San Antonio Economic Development Foundation. “It helps you market your city. It’s really a triple whammy.”

Whitacre, who turned the reins over to Stephenson just a year ago, said in a phone interview that he thinks the conditions still exist that made San Antonio a great place for a corporate headquarters. But because he no longer works there, he said it isn’t for him to judge.

There were warning signs that Whitacre’s departure and AT&T’s rapid expansion could lead to the move.

In 2006, as AT&T Inc. was wrapping up its acquisition of Atlanta-based BellSouth, the governor of Georgia and the mayor of Atlanta sought an audience with Whitacre with incentives in hand.

But the EDF’s Hernandez said then, “as long as Ed Whitacre is head of AT&T, we’re pretty well-positioned.”

Whitacre moved Southwestern Bell to San Antonio even though a New York-based relocation consultant recommended against the Alamo City because its airport lacked direct flights. “He said to me, ‘Most of our business is in Texas, so we need to be in Texas,’” Hernandez said in 2006.

But times have changed and Dallas telecom technology businesses now boast 45,000 employees with corporate headquarters or U.S. offices of foreign companies such as Alcatel-Lucent, Cisco, Ericsson, Fujitsu, Huawaei, Nokia, Nortel, RIM and Samsung. All are key suppliers to the telecom industry, according to AT&T.

AT&T already has about 14,000 employees in Dallas, and the company has two buildings that are only partially occupied on South Akard Street across from the historicAdolphus hotel.

The company also said it will save time and money by being close to a major airport hub.

AT&T executives expressed concerns to San Antonio city officials two years ago about the need for more efficient air service without layovers in Dallas or Houston, Callaway said.

“They’ve done everything humanly possible to get direct flights, but there’s only so much they can do,” Callaway said.

Wolff and Mayor Phil Hardberger met Wednesday with Stephenson to discuss the growth of direct flights at San Antonio International and about a joint parking project under consideration for AT&T properties.

Wolff said Stephenson told him Friday that the board made the decision based on his recommendations.

While the company will still have 1,700 more employees in San Antonio than it did 16 years ago, “you don’t replace this company,” Wolff said. “You can’t replace that kind of icon. It gave us a major presence you’re just not going to be able to replace.”

The business community, too, was stunned.

“We want to believe that our city is able to attract the best and the most capable companies in the country and provide jobs in San Antonio. As a citizen of the city, it is sad news,” said Raul Lomeli, a member of the San Antonio Hispanic Chamber of Commerce executive committee and a vice president for Wells Fargo Bank.

Greater San Antonio Chamber of Commerce President Richard Perez argues “all is not lost” with an economy that remains robust and still has a strong AT&T presence. For example, a long-term lease will keep the AT&T name on the arena where the city’s NBA franchise Spurs play.

Perez said AT&T simply outgrew San Antonio. Whether it was airport needs or other issues, the city tried to keep pace with the needs of a huge international player like AT&T but came up short, he said.

Hardberger cited other Fortune 500 companies that still call San Antonio home including Valero Energy Corp., Tesoro Corp., Clear Channel Communications Inc. and USAA.

Dallas City Manager Mary Suhm