Prepare for a game of commercial property musical chairs in the City of London. Investment bank JP Morgan is already participating, and has announced the appointment of property consultants Cushman & Wakefield and DTZ, who will have their fingers on the start and stop buttons.
More are expected to join the proceedings, which commenced when JP Morgan revealed plans to move from its existing location and occupy a 1m sq ft Canary Wharf seat left vacant by another investment bank, Lehman Brothers, which went bust in 2008. The £495m commercial property purchase from Canary Wharf Group (CWG) will become JP Morgan’s European investment bank headquarters from 2012.
It is believed that surrendering the leases on JP Morgan’s existing commercial property sites would have resulted in heavy financial penalties, hence the decision to enlist Cushman & Wakefield and DTZ. Their role will be to manage the changeover by subletting the bank’s 700,000 sq ft of office space, located in Alban Gate and Aldermanbury Square.
JP Morgan initially intended to move to Docklands when it paid £237.9m to CWG in 2008 for land at Riverside South. It still owns the estate, where CWG are building to street level, as part of a development contract extended from 2013 to 2016.
Due to the size of the commercial property offering, another financial occupier is expected to settle in its place. Schroders is rumoured to be shuffling its feet and eyeing up vacant commercial property, having already observed BNP Paribas’ confirmed Kings Cross move, sealed towards the end of 2010.
For now, it is content to remain out of the game, only admitting the appointment of residential and commercial property agent Knight Frank ‘to undertake a preliminary assessment of the City market’ as part of a ‘longer-term planning process and identification of potential future options’.
