500 workers at CareFirst to leave city; Company moving staff near headquarters in Owings Mills; 'Blow for downtown'; Shift means quarter of Bank of America tower will be vacated; Health insurance


Downtown Baltimore took a hit yesterday as CareFirst BlueCross BlueShield announced that it will pull 500 administrative employees out of the city and move them to a new site near the health insurer's headquarters in Owings Mills.

In addition to shifting workers out of downtown, the company is vacating more than a quarter of the 17-story Bank of America tower at 100 S. Charles St. -- 110,000 square feet of 430,000.

"It's obviously a significant blow for downtown Baltimore, because they're a major player in the area," said Donald Manekin, senior vice president of Manekin Corp., a Baltimore real estate company.

Downtown Partnership President Laurie Schwartz said her organization will try to persuade CareFirst to reverse its decision. "It would be a terrible loss if CareFirst were to move out of downtown," Schwartz said.

However, the company said it is going ahead with its plans. On Sept. 10, CareFirst signed a lease on a yet-to-be-constructed 96,000-square-foot, single-story office building on Red Run Boulevard in Owings Mills, less than a mile from the company's headquarters on Mill Run Circle. The builder will be Merritt Properties LLC of Woodlawn. CareFirst said it is making the shift, which is to begin by late next summer, in order to consolidate its local operations and save money on lease costs. The company said it stood to save 25 to 30 percent on rent by moving, and will be the sole occupant of the new building.

"We've had a good experience in Baltimore City," said CareFirst spokesman Jeff Valentine. "We're taking advantage of an opportunity to move a big chunk of our employees downtown out to our headquarters. It's more convenient and more cost-effective to do that."

Schwartz said such sentiments show that, while the downtown area has seen growth in employment and economic activity for two years, getting businesses to stay can still be a challenge.

"The fact that economics drove CareFirst's decision causes us to want to redouble the efforts to level the playing field between downtown and our suburban competition," Schwartz said.

The workers affected by the move are primarily management and support personnel. The company said the relocation will not entail any job cuts. The company has 1,500 employees at its Owings Mills offices.

CareFirst, Maryland's largest health insurance company, will retain its Inner Harbor Health Center on East Lombard Street and its stake in CarePartners, a consortium of health groups serving Medicaid patients. CarePartners' facilities are across from Mercy Medical Center at 321 N. Calvert St.

The company said it might place more operations downtown later but has no specific plans yet. "We're looking to see what would be an appropriate placement of functions in downtown Baltimore sometime in the future," Valentine said.

M. J. "Jay" Brodie, president of the Baltimore Development Corp., said that, in response to CareFirst's requests for proposals, at least seven sites in the city had been offered as relocation possibilities.

Brodie said he was optimistic that CareFirst's current offices would soon find another occupant, and that CareFirst would eventually add to its city work force. "We've had active conversations, particularly about enlarging their corporate presence in the city," Brodie said.

The owner of CareFirst's current building, REIT Management and Research Inc. of Washington, did not respond to requests for comment on CareFirst's decision.

Pub Date: 9/25/99

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