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The largest bank in the U.S. by assets is getting smaller — at least in terms of the real estate it occupies.
JPMorgan Chase will "significantly reduce" its office footprint in the coming years as it overhauls the design and usage of its workplaces, CEO Jamie Dimon said in his annual letter to shareholders. Though he acknowledged some limitations to remote work, Dimon said that up to 10% of the bank's employees "in very specific roles" will work from home permanently.
“Remote work will change how we manage our real estate,” Dimon said in the letter. “We will quickly move to a more open seating arrangement, in which digital tools will help manage seating arrangements, as well as needed amenities, such as conference room space."
With the new layout and seating style, JPMorgan will only need 60 desks for every 100 employees, Dimon estimated. The plan could come as a surprise in light of the bank being among the first major companies that attempted to bring workers back in September before a second surge in coronavirus cases scuttled that idea. JPMorgan employs about 255,000 people worldwide.
The bank's reduction of space could have major market implications in New York, where the bank is the largest private occupier of office real estate, Commercial Observer reports.
"A 1% change in JPMorgan's occupancy means a lot more than 50 startups," SquareFoot President Michael Colacino, whose company focuses on tenant representation exclusively, said on a Bisnow podcast in September. "The startups produce a lot of innovation ... [but JPMorgan] occupies tens of millions of square feet around the country. The focus on Facebook and Google, it's all kind of artificial, because they are not the ones that drive office demand in cities like New York."
JPMorgan's biggest real estate move remains in the plan, with Dimon reiterating the company's commitment to building its new headquarters at 270 Park Ave. in Manhattan after tearing down the current one. Some of the space it intends to give back will be as a result of consolidation once the new HQ is complete, which Dimon estimated to be in the middle of this decade. Between 12,000 and 14,000 workers are expected to populate the new 270 Park Ave.
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