Aetna Discussing Boston Move With Massachusetts Officials

Jan. 31--For the past six months Aetna Inc. has been discussing a move to Boston with Massachusetts Gov. Charlie Baker's office, sources close to the negotiations say.

It is unclear how serious Hartford-based Aetna is about a possible move -- or how much of the company would leave the city -- but the health insurer has been inquiring about as much as 400,000 square feet of space, an amount that would be difficult to find in one location in Boston.

Aetna's talks with Boston come after General Electric Co. relocated its headquarters from Fairfield to Boston last year, raising alarm about the state's business climate.

Commercial real estate brokers in Boston contacted for this story confirmed they are hearing about the efforts to lure Aetna to Boston, a move that stretches back to early 2015. That's when Aetna joined with GE to publicly criticize the state's tax climate. Boston and other cities quickly reached out to Aetna.

Aetna has about 6,000 workers in Connecticut, the heaviest concentration in its Hartford headquarters. If Aetna were to occupy 400,000 square feet in Boston, that amount of space could potentially accommodate as many as 1,600 workers, roughly four workers for every 1,000 square feet.

The future of Aetna's employment base in Hartford, where it was founded in 1853, was further complicated when the health insurer announced a $37 billion acquisition of Humana Inc. Aetna CEO Mark Bertolini was noncommittal about keeping much of Aetna in Hartford, instead looking to Humana's home base of Louisville, Ky.

A federal court blocked the merger earlier this month, but concerns about Aetna's presence in Hartford remained, especially after reports about the insurer's interest in Massachusetts surfaced in Boston media.

"There is certainly a heightened sensitivity after the GE decision last year," said Joe Brennan, president and chief executive at the Connecticut Business & Industry Association. "We're all doing our best to make sure Aetna continues to have a strong presence here."

The chief of economic development for the city of Boston was unavailable for comment Monday. A spokesman for Baker's office said the administration does not comment on "potential business development deals."

Aetna spokesman T.J. Crawford said Monday the insurer does not comment on speculation.

"We remain headquartered in Hartford, and we're committed to our employees here, who continue to be an important part of our future," Crawford said.

In 2015, General Electric and Aetna both publicly opposed proposed state tax increases. Aetna took aim at a plan to triple to 3 percent a tax on computer and data processing services. That increase was not enacted.

GE moved its headquarters out of Connecticut last year. The company said it was taking advantage of the concentration of universities and the many software designers, engineers and other technology workers. But state tax policy was blamed for GE's departure.

Elected officials now say that large-scale economic development efforts at Sikorsky Aircraft and United Technologies Corp. and efforts to boost growing employment at Electric Boat show they know how to keep major employers in Connecticut.

"This is going to be an ongoing thing," House Speaker Joe Aresimowicz said. "We saw how successful we were with Sikorsky, Pratt & Whitney and Electric Boat."

Aresimowicz said the concerns raised by by Aetna over the tax issue opened the door to communication between Aetna and legislative leaders. The discussions continue with Gov. Dannel P. Malloy, he said.

Last week, Malloy said he reached out to the "highest level of the company" after the court blocked the Humana merger. Malloy said Aetna was still evaluating its next steps.

"We're on hold, in some senses, I suppose," Malloy said. "Having said that, the Aetna has been a big part of Connecticut and they know the quality of the people they have working for them here."

Connecticut is active in trying to woo companies to either expand in the state or move here, Malloy said.

"This is a 50-state and international competition for talent," Malloy said. "We're involved in that."

Malloy added that he "continues to deliberate tax policy and continue to review on a regular basis what other states are doing and ensure we retain our competitive situation."

On Monday, Malloy introduced a tax cut for the insurance industry.

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