As hybrid work arrangements gain traction and the acceleration of digital services cuts the number of face-to-face interactions, banks in Singapore are reconsidering their commercial property requirements. The city state’s biggest lender DBS currently occupies more than 12 floors of Marina Bay Financial Centre Tower 3, but is looking to dilute its physical presence in the central business district.
Speaking at a media briefing on April 30, DBS chief executive Piyush Gupta said: “We said earlier when we announced our thinking on the future of work, that we are giving our employees the flexibility of working from home up to 40% of the time, about two days a week or on alternate weeks, or in a rhythm that works for their department. And as we do that, over the next five to six years, as and when our leases are up for renewal, we anticipate seeing a reduction in our overall (office space) requirements by about 20% because we are reshaping the offices.”
Singapore’s second largest lender OCBC is also reviewing its office and retail space needs. Responding to a question at the bank’s recent annual general meeting, new CEO Helen Wong said: “Covid-19 has changed the workplace operating model and we need to embrace the changes to create an agile and flexible organization. This includes redefining the future work model, such as remote working, workforce policies, and office space requirements.”
UOB, which reports its first-quarter 2021 financial results on May 6, is also said to be considering downsizing its commercial real estate requirements.
According to a recent report, Standard Chartered could give up a minimum of four floors from the 21 floors the bank currently leases at Marina Bay Financial Tower 1.
Unsurprisingly, tech companies who have fared well through the global pandemic are taking up the prime office space vacated by financial institutions in Singapore’s CBD.
Chinese tech firm ByteDance snapped up three floors in One Raffles Quay’s North Tower which were previously occupied by Swiss bank UBS.
The Zurich-based institution moved to a Grade-A office building at 9 Penang Road, close to prime shopping belt Orchard Road in the third quarter of 2020, bringing its close to 4,000 employees under one roof. It had previously leased around 230,000 square feet at One Raffles Quay and about 90,000 sq ft at Suntec City.
Last October, US banking giant Citigroup relinquished three of the nine floors it leases at Asia Square Tower 1. The space covering about 90,000 sq ft has since been taken up by multinational technology firm Amazon.