HFD/Conn Economic development

[HartfordTycoon]

Hartford Courant

Courant.com

UnitedHealth To Relocate In Hartford

By KENNETH R. GOSSELIN

The Hartford Courant

11:26 AM EDT, March 24, 2009

UnitedHealth Group, which employs more than 2,000 in downtown Hartford, will remain in the city -- but move from its current location to CityPlace I and invest $35 million in renovations.

Gov. M. Jodi Rell announced the move today, including an additional $1.5 million in funding from the state for energy-efficiency and other renovations at the new location.

The relocation is expected to create up to 200 construction related jobs over the next 18 months. In accepting the state funding, United Health has agreed to maintain 2,000 employees in Hartford for at least three years.

UnitedHealth now occupies 500,000 square feet at Connecticut River Plaza but its lease expires in 2010. Last month, the health insurer confirmed that it was examining options and did not rule out a move to the suburbs.

The health insurer, however, said it's strong preference was to remain in downtown Hartford.

"Our decision to remain in Hartford reinforces the company's on-going commitment to the region as both an employer and a community partner," said Mike Matteo, chief executive of UnitedHealth's national accounts business, which is based in Hartford. "Hartford has long been home to leading health care and financial services companies."

[beerbeer]

http://www.newsday.com/news/local/wire/con...0,3121678.story

[HartfordTycoon]

Yes, they are. I'm moving this to the econ development thread where I posted the article on this from the Courant earlier in the day.

[The Voice of Reason]

So I am guessing this pretty well fills up city place again. now the big vacant space will be on the waterfront.

I hope that Riverfront plaza can attract a new company to Hartford

[The Voice of Reason]

There is an updated more detailed article now is the Courant.

so it loosk like its 2300 workers moving not 2000.

17 floors are being leased.

http://www.courant.com/business/hc-united-...0,4851216.story

Next summer's move will give a much-needed boost to retailers and restaurants around downtown's tallest tower as 2,300 UnitedHealth employees relocate from Connecticut River Plaza off Columbus Boulevard near the riverfront to the corner of Trumbull and Asylum streets, considered by many as the heart of downtown.

Daryl Richard, a UnitedHealth spokesman in Hartford, said the insurer plans to occupy floors two to 12 and 15 to 20 in a long-term lease, but he declined to discuss specifics of the rental agreement except to say the lease "locks in at an attractive rate."

According to local brokers, it is likely the lease would run for at least 10 years and fill at least 400,000 square feet.

Based on Loopnet

http://www.loopnet.com/xNet/MainSite/Listi...p;PgCxtDir=Down

the space being leased comprises 421,528 SF

The 35th floor will also become available on 09/01/2009 so there is a chance it might be included later? but for now I would consider this a 421,528SF lease

[The Voice of Reason]

OK so I just had to make this a new post now because there is a lot of information out there.

from this link

http://www.hartfordbusiness.com/news8105.html

we can see that United Health was pretty much guaranteed to leave anyways because the landlord was marketing the space before any move was made public.

It looks like the lease that was owned by citigroup expires in 2010 and the landlord is looking for new tennants and new conditions etc... United Health held 460,000 SF and travelers it seems about 50,000 SF

Now 556,000 is coming available. Tavelers may re-up, but may not, who knows. This appears to be the entire building. well both buildings.

Shopping For 450 Columbus Tenants

The downtown Hartford office building that houses 2,500 employees of UnitedHealthcare is in the market for tenants.

Landlord Connecticut River Plaza Trust, owner of 450 Columbus Blvd., is shopping for one or more companies to occupy the 556,000 square feet of space in two towers, which adjoin Interstate 91 and overlooking the Connecticut River.

Citigroup currently holds the master lease to the building and subleases space to UnitedHealthcare and Travelers Cos., which occupies all but about 50,000 square feet, said broker Shawn McMahon, senior vice president of Jones Lang & LaSalle Inc., which was hired to market the property.

"It's the largest block of space available in Connecticut,'' McMahon said. "We're optimistic.''

It also competes with about 400,000 square feet of unfilled space in CityPlace I, formerly occupied by MetLife, he said.

The lease also is being marketed in Boston and New York City, McMahon said.

Connecticut developer Richard Gordon built 450 Columbus in 1985, with Travelers originally holding the master lease. Not long after, Connecticut River Plaza Trust bought the building, McMahon said.

Through mergers and acquisitions over the years, Citigroup eventually acquired the lease, which expires in August 2010, he said. UnitedHealthcare has occupied the building since 1994.

The landlord is prepared to invest millions of dollars on renovations and upgrades to the towers to attract or retain a major tenant, he said.

Also I thought I would add that the connecticut river plaza should be pretty successful in attracting a new tennant. the available space being 556,000SF. Thats a huge space, clearly large enough to employ 2300 people. it is also one of the easiest places to get to from East of the River. Street traffic on Colombus is minimal. Also the Morgan Street Garage assures virtually unlimited parking over there. Since the city controlls Morgan there is definately leverage for bringing the deal hammer to the table with any prospective tenant. Oh and there is actually a very nice view from there and extremely visable signage. for drivers on both I-91 and I-84.

My prediction.... (a weak one I will concede)

OAKLEAF WASTE moves across the river and takes half the space.

ok more likely is Travelers takes up even more space.

Ideally some NY or Boston firm will come to hartford and take 500,000 SF

[The Voice of Reason]

http://www.hartfordbusiness.com/news8340.html?Type=search

SS&C is expanding in Windsor.

mind you they have had some layoffs recently as some of their clients went under or merged, but the fact that SS&C is making an acquisition is a good sign.

SS&C paid an undisclosed amount for the assets of Evare LLC, including more than 50 Evare clients and about 40 employees.

[MadVlad]

OK so I just had to make this a new post now because there is a lot of information out there.

from this link

http://www.hartfordbusiness.com/news8105.html

we can see that United Health was pretty much guaranteed to leave anyways because the landlord was marketing the space before any move was made public.

It looks like the lease that was owned by citigroup expires in 2010 and the landlord is looking for new tennants and new conditions etc... United Health held 460,000 SF and travelers it seems about 50,000 SF

Now 556,000 is coming available. Tavelers may re-up, but may not, who knows. This appears to be the entire building. well both buildings.

Shopping For 450 Columbus Tenants

The downtown Hartford office building that houses 2,500 employees of UnitedHealthcare is in the market for tenants.

Landlord Connecticut River Plaza Trust, owner of 450 Columbus Blvd., is shopping for one or more companies to occupy the 556,000 square feet of space in two towers, which adjoin Interstate 91 and overlooking the Connecticut River.

Citigroup currently holds the master lease to the building and subleases space to UnitedHealthcare and Travelers Cos., which occupies all but about 50,000 square feet, said broker Shawn McMahon, senior vice president of Jones Lang & LaSalle Inc., which was hired to market the property.

"It's the largest block of space available in Connecticut,'' McMahon said. "We're optimistic.''

It also competes with about 400,000 square feet of unfilled space in CityPlace I, formerly occupied by MetLife, he said.

The lease also is being marketed in Boston and New York City, McMahon said.

Connecticut developer Richard Gordon built 450 Columbus in 1985, with Travelers originally holding the master lease. Not long after, Connecticut River Plaza Trust bought the building, McMahon said.

Through mergers and acquisitions over the years, Citigroup eventually acquired the lease, which expires in August 2010, he said. UnitedHealthcare has occupied the building since 1994.

The landlord is prepared to invest millions of dollars on renovations and upgrades to the towers to attract or retain a major tenant, he said.

Also I thought I would add that the connecticut river plaza should be pretty successful in attracting a new tennant. the available space being 556,000SF. Thats a huge space, clearly large enough to employ 2300 people. it is also one of the easiest places to get to from East of the River. Street traffic on Colombus is minimal. Also the Morgan Street Garage assures virtually unlimited parking over there. Since the city controlls Morgan there is definately leverage for bringing the deal hammer to the table with any prospective tenant. Oh and there is actually a very nice view from there and extremely visable signage. for drivers on both I-91 and I-84.

My prediction.... (a weak one I will concede)

OAKLEAF WASTE moves across the river and takes half the space.

ok more likely is Travelers takes up even more space.

Ideally some NY or Boston firm will come to hartford and take 500,000 SF

560k sqft is very big, it'd be nice for Hartford to become aggressive and try to get a company from out of State to occupy this very large tract of office space. I'm thinking it isn't every day, or every decade that something this big becomes open in one place.

[The Voice of Reason]

Funny you say that.

The courant has an article today about office vacancies, and hartford is actually holding up quite well concidering. I will paste a few bits of the article, but check out the bold part

New figures to be released this week show that downtown Hartford's vacancy rate for prime office space was 19 percent in the first quarter of this year, compared with about 14 percent a year ago, according to the commercial real estate services firm Cushman & Wakefield of Connecticut.

The jump in vacant Class A office space is significant, but commercial real estate brokers say it is almost entirely attributable to MetLife's move from downtown Hartford to Bloomfield. Otherwise, the office market has held fairly steady even as the recession has deepened.

A large block of space at Connecticut River Plaza could prove attractive to a large tenant once an economic recovery gets underway, said Christopher Ostop, a broker at Jones Lang LaSalle, the building's leasing agent.

It is rare for such a large block of space to come on the market, and there is ample parking.

"It's similar to what has been built up in the suburbs," Ostop said.

I think it is like you and the guy from JLL said, RARE, and I am sure the owner is pushing hard to lure in a new company from NY or Boston as stated in the older article I posted. I would also assume the city and state are trying to help as much as possible.

I think I need to e-mail the building owners to give them some suggestions as for whom to target

I want to see Not just Boston and NY targeted. I think Toronto is the best target.

there are huge banks and huge insurance companies that have presence in the US and CT, but no major Hartford Office.

TD BANK, SUNLIFE... yup and the office space costs half as much here.

[MadVlad]

Funny you say that.

The courant has an article today about office vacancies, and hartford is actually holding up quite well concidering. I will paste a few bits of the article, but check out the bold part

New figures to be released this week show that downtown Hartford's vacancy rate for prime office space was 19 percent in the first quarter of this year, compared with about 14 percent a year ago, according to the commercial real estate services firm Cushman & Wakefield of Connecticut.

The jump in vacant Class A office space is significant, but commercial real estate brokers say it is almost entirely attributable to MetLife's move from downtown Hartford to Bloomfield. Otherwise, the office market has held fairly steady even as the recession has deepened.

A large block of space at Connecticut River Plaza could prove attractive to a large tenant once an economic recovery gets underway, said Christopher Ostop, a broker at Jones Lang LaSalle, the building's leasing agent.

It is rare for such a large block of space to come on the market, and there is ample parking.

"It's similar to what has been built up in the suburbs," Ostop said.

I think it is like you and the guy from JLL said, RARE, and I am sure the owner is pushing hard to lure in a new company from NY or Boston as stated in the older article I posted. I would also assume the city and state are trying to help as much as possible.

I think I need to e-mail the building owners to give them some suggestions as for whom to target

I want to see Not just Boston and NY targeted. I think Toronto is the best target.

there are huge banks and huge insurance companies that have presence in the US and CT, but no major Hartford Office.

TD BANK, SUNLIFE... yup and the office space costs half as much here.

Why limit it to NYC, Boston, or Toronto. Do a broad search worldwide. Start with the ones mentioned, then move onto other cities, Des Moines (they tried to scoop us, scoop them back), Atlanta, Charlotte, Raleigh. Go abroad, London, Dubai, see who needs to have a nice East Coast USA presence, and make it happen.

[The Voice of Reason]

Hell yeah I agree. at about $28/SF riverfront class A space, 450 Columbus is a steal as far as space goes.

Sure des Moins might be cheaper, But cities like Boston NYC, Toronto all pay a ton more. I think its easier when you stay relatively geographicly close but shop the expensive cities.

I mention Toronto because I like North American HQ offices more than just a regional office.

Maybe we can get GE to move up here though?

haha

anyways if somehow Hartford pulls something off, filling this building would put the class A vacancy at something like 13%. When AETNA is finished moving into the ING space it would go a few points lower.

[The Voice of Reason]

Robinson cole is doing layoffs in Hartford.

http://www.hartfordbusiness.com/news8446.html

I hate to see the law firms do layoffs. these are some of the best paying jobs a region can have.

[The Voice of Reason]

So I found a blurb saying that Webster sees itself as an acquisition player over the next 2 years

Webster Financial Corp. CEO James Smith says the company could be a buyer over the next two years as the banking industry consolidates, according to an April 3 report in the Boston Business Journal.

I guess this means they are doing ok now.

[The Voice of Reason]

OK, so I see what they are doing here

More than a week after laying off 30 lawyers and staff, Hartford law firm Robinson & Cole today announced the hiring of two prominent Rhode Island attorneys who have opened its ninth office in Providence.

It bakes sense to me. it sucks that hartford lost some nice high paying jobs, but this firm is Headquartered in Hartford, and if we have a short term cut back and a long term expansion it ultimately helps the city.

Lets hope they open a few more office and then hire on the support staff in Hartford downt the line.

[The Voice of Reason]

Not sure what is up, but a new rumor has popped up on the business wires.

Aetna to buy Cigna.

The Humana rumor pittered out pretty quickly a few weeks ago, but now apparently the rumor is for Aetna to buy Cigna. I guess Aetna is looking at making a fairly major purchase and might be kicking the tires at a few of its competitors.

Cigna employs 30,000

they have a ton of workers in CT

they are headquartered in Philly. I think they might even have more workers here than philly

it is just a rumor for now though

EDIT

Now at market close there are a few more reports on my Bloomberg terminal.

www.thestreet.com says this:

As we mentioned, this buying activity could be a bet by an investor that shares of CI will continue to run if the earnings announcement has positive data. Another thing that could be driving the call buying is continued speculation that Aetna(AET Quote) might be interested in buying CI. There are various unconfirmed rumors circulating that AET might be interested in paying as much as $32 per share for CI.

$32 a share would put the purchase price at $ 8,673,216,000.00 Cigna has a revenue of 19.101 Billion in 2008 and 30,000 empoyees.

[The Voice of Reason]

Time for some updates

First,

The Walgreens distribution center in Windsor just opened the other day with 250 new workers. YAY

http://www.hartfordbusiness.com/news8596.html

Second,

Peoples bank put out its quarterly report yesterday.

as part of the report it was mentioned that they ACTIVELY seeking to buy another bank

They note the co is actively seeking

to buy another bank in order to deploy its excess capital, and they believe

that if/when such an announcement occurs, PBCT stock is likely to decline,

based on their analysis of potential merger partners and the resulting pro

forma P/E and P/TCE ratios.

Briefing.com, Inc.

and the HBJ just published this

http://www.hartfordbusiness.com/news8645.html

Bridgeport-based People's United Financial Inc., whose increase in first-quarter profits prompted a higher dividend, said the bank is exploring opportunities for an acquisition.

"As we have said previously,'' said CEO Philip R. Sherringham, "we still feel it is best to exercise patience as we work toward identifying and executing an acquisition that will enhance the long-term profitability of the company.''

We have been hearing this for a while but the tone is getting a little more aggressive. Lets hope PBCTs growth benefits the state. and um Hartford

Thirdly,

CBRE the REIT based in Hartford is selling controlling interest to a Norwalk firm.

CBRE was in some big trouble, so this is better than absolute failure. also its still not out of the woods,

http://www.hartfordbusiness.com/article_li...113;ArticleType

Realty Finance, formerly CBRE Realty Finance, said today its need for capital has risen as cash flow has fallen at one of its trusts, erasing more than $800,000 in payments that it was due in early April. RFC primarily owns commercial properties and real estate-related debt in the form of collateralized debt obligations, or CDOs

[drc72]

I would like to see Peoples move their headquarters from Bridgeport to Hartford.

[The Voice of Reason]

The breakup of The Hartford

It is being widely reported that The hartford is ACTIVELY looking to sell its pieces off.

http://www.hartfordbusiness.com/news8670.html

Currently The Hartford is shopping parts of the business to

Travelers of NYC

ACE of Zurich

Allianz of Munich Germany says they are not interested even though they invested 2.5 billion in the company several months ago.

Unlike other sales rumors, this one includes the property and casualty division.

this is the only profitable part of The Hartford, so experts agree that this would lead to the end of the Hartford.

There are articles in all kinds of places.

http://dealbook.blogs.nytimes.com/2009/04/...insurance-unit/

I think I would prefer ACE to Travelers, because I think a cross town merger would cost the city a ton of jobs

[HartfordTycoon]

The breakup of The Hartford

It is being widely reported that The hartford is ACTIVELY looking to sell its pieces off.

http://www.hartfordbusiness.com/news8670.html

Currently The Hartford is shopping parts of the business to

Travelers of NYC

ACE of Zurich

Allianz of Munich Germany says they are not interested even though they invested 2.5 billion in the company several months ago.

Unlike other sales rumors, this one includes the property and casualty division.

this is the only profitable part of The Hartford, so experts agree that this would lead to the end of the Hartford.

There are articles in all kinds of places.

http://dealbook.blogs.nytimes.com/2009/04/...insurance-unit/

I think I would prefer ACE to Travelers, because I think a cross town merger would cost the city a ton of jobs

Damn, tough stuff. I'm with you in that ACE will probably be much less devastating to the city of Hartford than would Travelers. However, if Travelers wants to buy them I hope that Blumenthal forces them to move the HQ back to Hartford in order to approve the deal. Either way, this is not looking good at all.

[The Voice of Reason]

Lets play some economic chess

1-2 years from now, what will we have?

The Hartford

= GONE

option 1 sold to Travelers

Many jobs lost in Hartford due to redundancy.

option 2 Sold to ACE

most jobs saved maybe even some added as ACE Americas moves HQ to Hartford

Option 2 Sold to ace

management jobs lost to existing ACE Americas HQ. 30% loss in jobs

The Phoenix

= A shell of its former self, but still chugging along maybe with only 300 employees.

Aetna

= will buy someone and nearly double in size. This is really, the best thing going in greater hartford.

There have been too many rumors floating around for there to be no truth to them.

Humana rumor, Cigna rumor, whats next? I hope is it is a big merger and can help bring a few thousand more jobs back to Hartford.

Travelers

= likely to make an acquisition, but no idea what will happen. will the company firm up a true HQ in NYC, or will more jo0bs flow to Hartford?

Peoples Bank

likely to double in size through acquisition.

I doubt they will move HQ location anywhere, and there is no telling how many more jobs Hartford might get. but I guess you never know.

Webster Bank

likely to grow in size slightly and there is a small change of moving HQ to Hartford. the bank currently has half the bank in HQ, and there have been rumors of a move in the past. we will see how the company evolves in these crappy times.

UTC

likely to make some acquisitions. not sure how many or where.

not likely to affect local jobs too much since the company is very departmentalized and keeps acquisitions almost unchanged.

I would love to see the company consolidate downtown, but thats just a dream!

anything esle?

any other guesses?

[The Voice of Reason]

Funny thing.

an analyst published a report on potential Peoples bank mergers just at 2:38PM today.

as possible targets, they chose Valley National Bancorp as the top choice right now.

quite a bit of the article is about VLY. quoted from both bank leaders even. apparently they would concider a sale, but have not had an offer.

VLY is from Jersey, and has 196 branches in Jersey and metro New York and 14 billion in assets.

other targets that fit nicely according to the article include

Fulton Financial from Jersey

Wilmington Trust from DE

Independent bank from Maine but mostly in Mass

they say patience is a virtue and these banks are not too likely to sell untill pressures get harder, and PBCT has all the time in the world.

Another Analyst mentions Signature bank and Webster bank as possible partners. I do not think these guys realize that Webster has almost the exact same footprint, so that seems like a silly idea.

also acqusition of assets is a possibility. maybe Buying deposits from Soverign or Citizens in the same way that First Niagara bought deposits from PNC bank.

I love this kind of stuff. we usually tend to ignore all kinds of things, but mergers have such a huge effect on our lives.

[The Voice of Reason]

Very Interesting....

at 10:24 this morning it was reported that The hartford might be planning on buying Principal financial in conjunction with its sale of the P&C business to Travelers.

This would get The Hartford out of its traditional line of business, but it would make the company a powerhouse the retirement business.

they say the company could get 6.5 Billion for the P&C shop wich could be used to buy Principal.

The deal if it were to happen would expand the life insurance business, and the investment business

Principle offers retirement solutions, life and health insurance wellness programs and investment and banking products.

very interesting thought.

if whomever The Hartford sells the P&C business to keeps it in town, and a merger like this happens, it could actually work out well for the city. I am not at all optomistic on this one but as always hopefull.

[HartfordTycoon]

Very Interesting....

at 10:24 this morning it was reported that The hartford might be planning on buying Principal financial in conjunction with its sale of the P&C business to Travelers.

This would get The Hartford out of its traditional line of business, but it would make the company a powerhouse the retirement business.

they say the company could get 6.5 Billion for the P&C shop wich could be used to buy Principal.

The deal if it were to happen would expand the life insurance business, and the investment business

Principle offers retirement solutions, life and health insurance wellness programs and investment and banking products.

very interesting thought.

if whomever The Hartford sells the P&C business to keeps it in town, and a merger like this happens, it could actually work out well for the city. I am not at all optomistic on this one but as always hopefull.

Very interesting indeed.....

[HartfordTycoon]

Looks like we the people will be rescuing The Hartford. I'm OK with it for the good of the community.

Hartford Courant

Courant.com

INSURERS WIN TARP APPROVAL

The Hartford Wins $3.4 Billion In Federal Bailout Money

By DAN HAAR

Courant Business Editor

May 15, 2009

The Hartford received preliminary approval Thursday for a $3.4 billion federal loan under the emergency bailout program, a deal that would give the insurer breathing room and could ease the company's need to raise money by selling businesses.

Other major recipients of capital infusion from the Troubled Assets Relief Program will include Lincoln National Corp. and Prudential Financial Inc., both of which have significant operations in Hartford, and Allstate Corp., Ameriprise Financial and Principal Financial Group, Treasury spokesman Andrew Williams said. He declined to disclose the amount of investment each company will receive.

As investment losses have mounted at The Hartford Financial Services Corp., especially in the life insurance unit, the company has maintained that it has enough of a capital cushion to meet its commitments to policyholders. But, anticipating further losses, The Hartford confirmed April 30 that it is considering selling businesses.

The Hartford would not comment Thursday on how or whether the TARP infusion would affect a possible sale of businesses. Although it has not commented on published reports that it was seeking bids for its property-casualty unit from Travelers and other companies, the 199-year-old company made clear that a breakup was a possibility.

The Hartford estimated last year that it could obtain up to $3.4 billion from the program and said Thursday that it is prepared to abide by strict regulations that come with the TARP money, which, in the case of banks, have included new rules on executive pay.

"These funds would further fortify our capital resources and provide us with additional financial flexibility during one of the most volatile market climates in our nation's history," said Ramani Ayer, chairman and chief executive officer of The Hartford.

[The Voice of Reason]

I am ok with this as well. 3.4 Billion will go a long way in keeping the company intact and hopefully keeping the company healthy and in Hartford.

Interesting to see some of the other recipiants. Principle is one of them.

The crazy thing about this TARP money is that as long as the execs dont mind taking the pay cut, they can really save this company. assuming they plan on using the full 3 years to pay back the TARP, they can emerge a larger and stronger company. The stock has been trading so much stronger lately. even got as high as 18 last week, and after this weeks sell off, is bouncing back up into the 16.5 range right now.

I think with the support of the TARP monies investors are likely to be much more comfortable putting money back into HIG

If the markets continue to recover the Life unit will stabalize on its own, so in short, I am a little more at peace in terms of Hartfords future(the city and the company).

Now what would be sweet is that HIG and Principle continue their talks now that both have fed backing and still do a merger into a larger stronger player. The fed did lots of deals like this in Banking with BoA/ML PNC/National City