Report: Connecticut insurer calls off NYC move

Aetna's planned new headquarters at 61 Ninth Ave. in New York City. Rendering pictured. Aetna's planned new headquarters at 61 Ninth Ave. in New York City. Rendering pictured. Photo: Aetna Photo: Aetna Image 1 of / 5 Caption Close Report: Connecticut insurer calls off NYC move 1 / 5 Back to Gallery

Aetna reportedly has abandoned its plan to move its headquarters to New York City from Hartford, weeks after the insurer left open the question of relocating on the heels of a merger agreement with CVS Health based in Rhode Island.

Crain’s New York reported a $9.6 million incentive package for Aetna is no longer in effect after the company decided not to move forward with the relocation, citing the New York City Economic Development Corp. An Aetna spokesperson reiterated “all Aetna locations will be evaluated as part of the integration planning process” with CVS, in response to a query by Hearst Connecticut Media.

As previously reported by Hearst Connecticut Media, Aetna left unanswered in early December employees’ questions on whether it would complete the move, which at last report would cost the company $84 million to move some 250 of its nearly 6,000 Connecticut employees to the Chelsea district of New York City. Coupled with additional incentives from New York state, the Aetna incentive package totaled some $34 million.

New York Mayor Bill de Blasio’s office estimated last June the city would see $146 million in economic benefits as a result of the Aetna move, with CEO Mark Bertolini having stated the company would consider additional investments there.

New York City’s incentives were to have included $4.3 million to offset sales taxes Aetna would have owed in investing in the new headquarters; $3.8 million in property tax benefits over 10 years; and additional sales tax benefits and a business incentive rate discount over the same span valued at $1.5 million.

Last May, Connecticut Gov. Dannel P. Malloy disclosed his prior overtures to match any other state’s incentives to keep Aetna’s headquarters in Hartford, an offer the company did not take at the time.

“Aetna ... is competing for programmers, designers and other talent — what I call intellectual capital — with the Googles and Facebooks of the world,” said David Greenbaum, president of the New York division of Vornado Realty Trust, speaking during an August conference call on his company’s efforts to develop the site that Aetna had chosen as its headquarters. “We’ve seen the same phenomenon in Chicago, where companies such as Allstate, Caterpillar and Conagra have moved to the market in part to rebrand themselves to recruit the best potential employees. As these old and new companies fight for the same talent pool, so too are they increasingly pursuing the same real estate.”

Includes prior reporting by Ken Dixon.

Alex.Soule@scni.com; 203-842-2545; @casoulman