Centene, a publicly-traded healthcare company valued at more than $50 billion, announced it is backing out of a plan to occupy 800,000 square feet at a $1 billion headquarters project in Charlotte, North Carolina. The under-construction development represented one of the largest public-private partnerships in the state’s history and would have created 3,200 jobs. Centene said the decision to pull out of the project was largely due to the shift towards remote and hybrid work that took place after the development was planned. “Today, almost 90 percent of our workforce is working fully remote or in a hybrid work environment, and workplace flexibility is essential to attracting and retaining our top talent,” the company said.
The headquarters and tech hub would have received more than $450 million for the development from state and local authorities once it filled the 3,200 jobs it had promised to create. Centene’s project will still be completed, and the company is reportedly in negotiations with another tenant to occupy the space. The project was first announced in July 2020 and broke ground the next month. According to Centene, the first phase of construction of the state-of-the-art campus is anticipated to be completed in 2022 and the second phase by 2024. A host of amenities have been planned for the nine-story complex, including a childcare and early education center, walking trails, restaurants, a fitness center, and solar electric car stations.
Centene’s change of plans is yet another example in a growing list of companies that have closed offices, cut back space, and paused expansion plans as the preference for remote and hybrid work among employees continues. Whether or not workers are back in the office can vary widely between industry, location, and company size. Data shows major office markets like New York and San Francisco have more remote workers and have struggled to bring occupancy numbers up, while Southern and Sunbelt cities have posted higher numbers of in-office job positions and less remote opportunities. Centene’s major reversal in a southern city like Charlotte may be just an outlier or a sign of things to come.