Aetna consolidating NYC offices in Soho

Insurer signed on for 100K sf at One Soho Square after backing out of megadeal in Meatpacking

New York /
Aug.August 09, 2018 12:15 PM

161 Sixth Avenue and Aetna CEO Mark Bertolini (Credit: One Soho Square and Getty Images)

UPDATED, Aug. 9, 3:05 p.m.: Aetna, which earlier this year pulled an about-face on plans to move employees from Connecticut to the Meatpacking District, will be consolidating some of its existing New York City offices in Soho.

The insurance company signed a lease for a little more than 100,000 square feet at Stellar Management’s One Soho Square, sources told The Real Deal.

Aetna signed a lease for the top four floors at 161 Sixth Avenue, the eastern portion of Stellar’s redevelopment project, according to sources. The company will be relocating and consolidating space it leases in Midtown at SL Green Realty‘s 100 Park Avenue and Empire State Realty Trust‘s 1333 Broadway.

“We are combining multiple existing locations into one updated space in New York City, and as a result have signed a lease at One Soho Square,” an Aetna spokesperson told TRD. “This will not impact employee headcount in the area; in fact, we expect job growth in the businesses that will be located in the new space, which we expect to occupy in the first quarter of 2019.”

Representatives for Stellar did not immediately respond to a request for comment.

Aetna last year signed a lease for the full 145,000-square-foot office portion of Aurora Capital Associates and Vornado Realty Trust’s new Meatpacking District office building at 61 Ninth Avenue. The plan was to consolidate the insurer’s existing Manhattan offices and move its corporate headquarters from Hartford, Conn.

But when CVS struck a deal to buy Aetna for $69 million, it pulled the plug in January on plans to move into the Rafael Viñoly-designed building.

Aetna hired Newmark Knight Frank to market the space for sublease, and CVS spokesperson David Palombi told the Wall Street Journal that the company has “no plans to relocate Aetna’s operations from Hartford.”

Sources said the Soho space will be used to relocate existing New York employees, and that no workers from Hartford will be relocated.

And Aetna will realize some cost savings with the Soho space.

A source familiar with the deal said the company’s rent on the 12th through 14th floors at One Soho Square starts at $84 per square foot, and begins at $112 per square foot on the 15th floor.

The company is paying rent of $130 per square foot in the Meatpacking District, where it’s still responsible for the lease.

Another component of that deal that remains unclear is the status of the economic incentives that the city and state offered Aetna to relocate about 250 jobs to the city from Hartford.

Gov. Andrew Cuomo’s Empire State Development Corp. offered the company $24 million in performance-based tax credits over 10 years. And the New York City Economic Development Corp. promised Aetna a $9.6 million incentive package.

The EDC reportedly cancelled that economic assistance when CVS announced Aetna would not move into 61 Ninth Avenue.

Representatives for ESD and EDC were not immediately available to comment.

Update: This story has been updated to include a comment from Aetna. 


Related Articles

arrow_forward_ios
Census tract 135 and Stellar Management's Larry Gluck (Credit: Getty Images and Stellar Management)
How a small stretch of land on the Far West Side became an Opportunity Zone
How a small stretch of land on the Far West Side became an Opportunity Zone
Homebuilding is largely responsible for the increase in construction spending. (Getty / Photo Illustration for The Real Deal)
Construction spending hits new record in January
Construction spending hits new record in January
The person behind the prank website is still anonymous. (Getty)
Phony website falsely claims REBNY cancels rent
Phony website falsely claims REBNY cancels rent
(iStock/Illustration by Kevin Rebong for The Real Deal)
These are real estate executives’ worst worries for 2021
These are real estate executives’ worst worries for 2021
15 West 47th Street, 48 West 48th Street and 151 West 46th Street (Google Maps, Getty)
Here’s what tenants are paying at ELO’s Diamond District properties
Here’s what tenants are paying at ELO’s Diamond District properties
Steve Witkoff and Ian Schrager in front of the iconic PUBLIC hotel escalators. (PUBLIC, Getty)
EB-5 fund alleges Schrager, Witkoff siphoned money from Public Hotel
EB-5 fund alleges Schrager, Witkoff siphoned money from Public Hotel
Best Buy has closed about 20 of its big-box stores in each of the past two years (iStock)
Best Buy lays off 5,000 staffers, increases store closures
Best Buy lays off 5,000 staffers, increases store closures
Ryan Serhant and Gary Barnett on Development Slowdown in Pandemic
Coffee Talk: Extell’s Gary Barnett and Ryan Serhant
Coffee Talk: Extell’s Gary Barnett and Ryan Serhant
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...