Humana to vacate iconic headquarters building in downtown Louisville

LOUISVILLE, Ky. (WDRB) -- Humana, the only Fortune 500 company headquartered in Kentucky, plans to vacate its iconic, 27-story headquarters building at 500 W. Main St. in a cost-cutting move, leaving a massive structure to fill in a downtown already struggling with a glut of empty office space.

The pink granite tower designed by the late, renowned architect Michael Graves, has been a symbol of Humana's homegrown roots since it was built about 40 years ago under the direction of the late Humana co-founder David A. Jones, a lifelong resident and champion of the city.

Just in November, the city unveiled a "Hometown Heroes" banner of Jones photographed in front of the gleaming tower in the 1980s.

But Humana, which ranks No. 42 on the Fortune 500 and brings in about $100 billion in revenue annually, no longer needs the building amid its embrace of hybrid and remote work. Exiting the tower will provide "significant cost savings," Humana told employees in an internal FAQ.

"We're constantly optimizing our real estate footprint, not just here in Louisville but around the country," Humana senior vice president Douglas Edwards told WDRB News on Monday.

The company will empty the tower over the next 18 months to two years, consolidating its Louisville headquarters into Humana's Waterside-Clocktower campus on the east side of downtown.

The connected Waterside and Clocktower buildings have about 40% more square footage than the tower at Fifth and Main streets, which was the main consideration in where to consolidate, a company spokesman said.

Edwards said roughly 2,500 of the company's estimated 10,000 Louisville-area employees are in the office on a typical work day, with their presence divided evenly between the iconic tower and the east downtown campus.

The Waterside-Clocktower campus has 3,725 workspaces, according to the Humana FAQ given to employees.

The plan ensures that Humana will have a singular location for Louisville-based employees to congregate.

"It's a very modern facility — open floor plans, lots of great workplace services — so that's the reason we decided to bring them together in that location," Edwards said.

Edwards said the company's savings will come in the form maintenance of the tower, capital expenditures no longer necessary to occupy it and some remediation costs that Humana has been shouldering to fix issues with the tower.

Last year, Humana sued the architectural, engineering and construction firms that were involved in the tower's construction from 1983-85, alleging that the company has incurred "significant costs" to fix "latent defects" with the tower that were not discovered until 2019.

On March 3, 2023, a day after the legal action was filed, Humana said the 27-story building was safe to occupy and that the company planned to rectify the defects to "ensure the building's sustainability for many years to come."

The lawsuit remains pending.

The announcement is in keeping with Humana's playbook over the last five years, especially in the wake of the COVID-19 pandemic when the company embraced remote work.

Humana for decades has been the largest office tenant in downtown Louisville, but it's vacated 800,000 square feet of leased office space in the Central Business District, commercial agents have estimated. In 2022, it donated an entire office building the University of Louisville.

Humana doesn't know what's next for the tower.

"It's still too early for us to say ultimately what's going to happen to that building," Edwards said.

He said Humana would work closely with Louisville Mayor Craig Greenberg in determining its best use.

In a statement Monday, Greenberg's spokesman said the city "appreciate(s) their (Humana's) continued commitment to our city as they make this transition."

"The Humana Tower is an iconic downtown building – in the heart of our city – and we view this as an opportunity for future growth," Kevin Trager said in the statement. "The mayor's office is looking forward to ongoing conversations with Humana and other partners about how this property's next chapter will continue to be an asset to our beautiful, vibrant downtown."

Humana officials said the announcement has no impact on Louisville-based employment, which still totals about 10,000 people and remains the largest geographic concentration of the company's 65,000 employees.

But the move will raise fresh doubts about the company's long-term commitment to the city.

As WDRB documented in 2022, many of Humana's top executives are based in a newer office outside Washington. And for the first time in company history, the CEO's job no longer requires living in Louisville, as CEO-in-waiting Jim Rechtin was given a choice of Louisville or the D.C. area when he was hired last year.

Asked about the company's future plans, Edwards said the Waterside-Clocktower space in Louisville "will be our headquarters." A Humana spokesman said Rechtin hasn't disclosed where he plans to live.

Edwards said the company's Washington-area space is "a key office just like many of our key offices around the country."

Downtown Louisville continues to struggle with a glut of vacant office space. The Humana building's 660,000 square feet (including the auxiliary space known as The Exchange) represents about 7% of the total space in the central business district.

And the company plans to vacate it in the same year that Louisville Gas & Electric will give up 14 floors in the building that bears its name, LG&E Center, three blocks away at 220 W. Main St.

"We have an iconic, internationally renowned building in our downtown. Figuring out what that reuse (is), is our opportunity — what it can become," said Rebecca Fleischaker, executive director of the Louisville Downtown Partnership. "We know that we need more residential development. We know we need more hotel development. Hopefully we could look at that as a reuse."

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