Thursday October 11 2007
DISPATCH :: Moving downtown
Patrick W. Rollens Associate Editor
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ST. LOUIS | Centene Corp., a health insurance management company based in Clayton, Missouri, has announced plans to relocate its corporate headquarters to a $250 million office development in the city’s Ballpark Village.
Dubbed Centene Centre, the project will be the first new Class A office constructed in St. Louis proper in 20 years. Two skyscrapers will add as much as 1.2 million square feet to the CBD's portfolio, and the project's importance has everyone energized, to say the least.
“It’s thrilling to me, because it’s such a high-visibility urban project that’s happening in a fabulous location,” says Cassandra Francis, a senior vice president with Chicago-based US Equities. “It’s actually the kind of project that we at US Equities love to get involved in.”
Francis’ firm is partnering with Overland, Missouri-based Clayco and Centene to form BW Development. The multifaceted venture will construct and lease the office and retail space. Both Clayco and US Equities responded to an initial request-for-proposal from Centene, and they ended up joining forces for the historic project.
“We were able to build a very strong partnership with Clayco quickly because our firms are very similar in our outlook and philosophy,” she explains.
The project will occupy two blocks in the Cordish Co.’s Ballpark Village development and generate about 1,200 jobs for St. Louis. BW Development will purchase the plot outright from Cordish prior to construction.
As expected, tax abatements played heavily into Centene’s decision to relocate downtown. According to the St. Louis Post-Dispatch, the city assembled a $78 million incentives package; more is promised from state and federal agencies.
“Centene will be the largest employer to move its headquarters into the city in decades—maybe as long as 50 years,” said St. Louis Mayor Francis Slay in a media release. “We will look back on this move as a tipping point for downtown.”
The first phase of Centene Centre will be a 27-story tower totaling about 700,000 square feet and anchored by Centene’s 400,000 square foot lease. A second tower, planned at 500,000 square feet, will be developed subsequently.
Downtown St. Louis most recently recorded 151,000 square feet of negative absorption in the second quarter of 2007, according to a market report by Colliers Turley Martin Tucker. It remains to be seen how the market will embrace this new project. Rents in the CBD are among the metro’s lowest, averaging just $19 per square foot.
Francis says BW Development hopes to break ground by early 2008 and allow for tenant occupancy by 2010.
“That’s a very tight schedule, but we really want to get Centene into their space as quickly as possible,” she says.
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