JPMorgan Proceeds With Plan To Build US$3b Office

USA – Even though the virus outbreak has changed how people work, JPMorgan Chase & Co’s CEO Jamie Dimon recently announced that the bank will push on with its plan to construct a new gargantuan HQ in New York City, reported Reuters on Thursday morning (15 October).

“We’re building that headquarters for 50 years! It is not a short-term decision,” Dimon told the media after announcing the bank’s quarterly financial results.

Estimated to cost up to US$3 billion, the upcoming structure in 270 Park Avenue is so massive that it can accommodate around 14,000 personnel.

The Council on Tall Buildings & Urban Habitat revealed that it would tower at 1,425 ft, making it Manhattan’s second tallest office building behind the One World Trade Center. It will also be higher than the Empire State Building and the nearby Bank of America Tower by nearly 200 ft and 225 ft respectively.

But at a time when most employees are working from home and only a few have returned to the office, the need for a mammoth office tower is called into question.

While JPMorgan has introduced new safety protocols and is encouraging office employees to return to their workplace, the Big Apple’s financial centres are not as bustling as they were prior to COVID-19, with lunch crowds in Midtown remaining sparse.

Based on forecasts by several property consultancies, tenants will require 10 percent to 20 percent less office space after the virus has been surmounted.

Additionally, almost 75 percent of employees surveyed by Piper Sandler & Co in the United States in mid-September expect that they’ll work from home more often compared to 59 percent who said so in a June poll.

JPMorgan’s Chief Financial Officer Jennifer Piepszak also shared that only 20 percent of its workforce are currently going to its New York offices, and the bank doesn’t expect that to change in the near future.

Wadley Donovan Gutshaw Consulting’s Principal Dennis Donovan commented that the bank will likely opt for fresh floor plans which are less dense with bigger conference rooms and probably more private offices. JPMorgan can do that with a new building instead of renovating an existing property.

Another expert said that while it appears illogical to undertake such a move given the pessimistic office market, maybe Dimon is doing this for his legacy.

“It really is something that will endure well beyond COVID-19,” added Tulane University’s Property Professor Jesse Keenan.