Centene, a provider of managed healthcare services, axed its plan to develop a $1 billion office complex in Charlotte, North Carolina, dealing a blow to efforts to lure workers back to the office.
Centene announced its Charlotte plans with fanfare in 2020, promising to build a 1 million-square-foot East Coast headquarters, where it would station 3,200 workers. On Friday, the company said it has dropped those plans and will let its North Carolina workforce work from home.
Since the pandemic started, businesses have been rethinking their portfolios of office buildings as most executives expect workers will at least split their time between home and the office, according to a recent JLL survey. The shift has led to a wave of office space available for sublease, as employers downsize their estate footprints.
“There has been a fundamental shift in the way people want to work,” Centene said in an emailed statement. “Almost 90% of our workforce is working fully remote or in a hybrid work environment and workplace flexibility is essential to attracting and retaining top talent.”
Centene and its development partners Clayco and Rafco Properties had already completed the first phase of its Charlotte office, which includes 800,000 square feet of office space at University Research Park in northeast Charlotte. Centene did not respond to questions on whether it will keep that office.
North Carolina had promised Centene $388 million in financial incentives.
Centene had also made a bet on North Carolina through its $19.6 billion acquisition in 2020 of WellCare Health Plans, which brought the company 642,000 new members and allowed Centene to expand into Medicare prescription drug plans.
St. Louis-based Centene employs 1,700 workers in North Carolina in Raleigh, Greensboro, Asheville, Wilmington and other cities.
Centene serviced 26.6 million members in its managed healthcare plans as of Dec. 31, including the sponsorship of Medicaid, Medicare and private-sector plans. The company generated $126 billion in revenue last year.