JPMorgan to slash Office Space

JPMorgan To Slash Office Space In Manhattan

USA – Sources revealed that JPMorgan Chase is seeking to sublease a significant amount of commercial space in 2 office towers in Manhattan, reported Bloomberg on Wednesday morning (3 March, SGT).

Specifically, the investment bank has appointed JLL to sublet slightly under 700,000 sq ft of office space in 4 New York Plaza within the Financial District, and over 100,000 sq ft in 5 Manhattan West in Hudson Yards.

The move by New York-based JPMorgan comes as businesses review their office space requirements amidst the COVID-19 outbreak.

“It is too early to comment on specifics as we continue to learn and adapt to this current situation and how it impacts our commercial real estate needs,” Michael Fusco, the bank’s representative, told the news agency via email.

Still, he said JPMorgan is committed to New York, and is planning for the next 50 years with its new headquarters there.

Currently, the company is constructing a new office tower along Park Avenue that will become one of the biggest in Manhattan.

However, JPMorgan’s CEO Jamie Dimon told Bloomberg TV that the prevalence of working from home due to the health crisis could result in lasting changes on how companies do business, including weaker demand for commercial space.

“New York could have a little bit of a difficult time. Already, real estate needs will come down. Most of us are going to go to more open seating because you don’t need 100 seats for 100 employees. You’re going to need like 60.”

In recent years, the investment bank has been reducing its headcount in New York, moving thousands of staff from the Big Apple, while increasing its presence in other areas. On Monday, Dimon stated that while a “large portion” of their employees will permanently work in their offices, others will benefit from a hybrid work arrangement, wherein they divide their work hours in the office and at home.

Notably, JPMorgan has been looking to consolidate its operations in Manhattan at its new HQ in 270 Park Avenue once it’s ready. But because the COVID-19 pandemic forced many people to work from home, it decided to sublet office space in 5 Manhattan West, where many of its tech employees were assigned.

In 2010, the bank divested 4 New York Plaza to a joint venture comprising Harbor Group and Capstone Equities under a sale-leaseback agreement. The office space it is seeking to sublet will be for the remainder of the lease expiring in 2025.

As for 5 Manhattan West, the bank opened its New York tech hub there in 2015. It is now seeking to sublease about 25 percent of the over 400,000 sq ft of office space there, added the source

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