Banks cutting real estate costs – part 2

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From Lauren Picariello
Director, Industry Research
Jones Lang LaSalle

Firms that can invest capital into relocating are taking advantage of the opportunity to consolidate and right size.

There have been a handful of cases where companies are vacating existing offices to consolidate and downsize into a new centralized space. In a traditional banking hub like Boston, for example, State Street will move from 1.3 million square feet across three buildings into an 11-story 515,000-square-foot built-to-suit.

On average, banks and financial services firms are downsizing 14.6 percent upon relocation.

Consolidation strategies are not purely an exercise in cost management. They also provide improved operational efficiencies within portfolios. Although trading floors offer less flexibility, back office and client-facing space is now more streamlined, compact and multi-purposed than ever before.

-Lauren

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