JPMorgan Chase & Co. plans to build a new tower in Canary Wharf for its headquarters in the UK, a multibillion-pound endorsement of London’s status as a global financial center a day after Rachel Reeves delivered a budget that largely spared banks.
The office building would be London’s largest by far at three million square feet and could host as many as 12,000 employees, according to a statement from the investment bank Thursday. The construction is expected to take six years.
The property, which will be co-developed by Canary Wharf Group, is being designed by Foster + Partners, the British architecture practice that’s also responsible for the bank’s recently opened global headquarters in New York.
“This building will represent our lasting commitment to the city, the UK” and its staff, said JPMorgan Chief Executive Officer Jamie Dimon. “The UK government’s priority of economic growth has been a critical factor in helping us make this decision.”
The plans are “subject to a continuing positive business environment in the UK and the firm receiving the necessary approvals,” according to a JPMorgan statement.
With a gross internal area of 3 million square feet, the proposal is about a third larger than the biggest office building currently in London, the 22 Bishopsgate tower, which has a a gross area of about 2.1 million square feet and about 1.2 million square feet of internal office space. JPMorgan said the development is expected to contribute £9.9 billion ($13 billion) to the local economy, including an additional 7,800 jobs across construction and other industries.
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The decision is a major coup for Reeves as she looks to boost growth in the UK after raising taxes by £26 billion in her Nov. 26 budget. Despite announcing widespread tax hikes that will hit bankers and other high earners, the chancellor of the exchequer refrained from increasing a levy on bank profits, a measure that had previously been under consideration.
Goldman Sachs Group Inc. also announced it would grow its UK presence by adding 500 roles to its Birmingham office in a separate statement Thursday. Various other lenders have also flagged plans to boost investment in the UK, which came after reports that the Treasury had encouraged the sector to publicly endorse the budget and talk up the economy.
JPMorgan’s decision to commit to the Riverside South site, having also examined a move to the City or a redevelopment of its existing UK headquarters, underscores the dearth of options for businesses seeking large new office buildings in London. Developers have been cautious about starting new projects following a series of shocks, including Brexit, post-pandemic flexible working, massive inflation in the cost of construction and the advent of higher interest rates.
Dimon has been one of the staunchest advocates for a return to the office, mandating earlier this year that most employees work onsite five days a week, an edict that’s set the tone for tougher policies across Wall Street. That’s been a key driver of Canary Wharf’s recent revival with the number of visitors traveling to the east London financial district by rail and tube surpassing pre-pandemic levels as more bankers resume the daily trek to their desks.
Read More: Canary Wharf Crisis Eases as Dimon Leads Bankers Back to Office
JPMorgan has even needed to lease additional space to facilitate staffers’ return, renting several floors in the former Credit Suisse office close to the US lender’s overflowing European headquarters.
Having made his mark on Manhattan with the bank’s new global headquarters, Dimon has now turned his attention to addressing the long-term question of the bank’s main European base, a project that will leave a lasting imprint on London.
JPMorgan acquired the Riverside South site in 2008 before opting to buy the former Lehman Brothers London headquarters at 25 Bank Street for its own occupation in 2010. The bank mothballed plans for the plot of land and hired brokers to sell it in 2014, a process that drew interest from a handful of residential developers who considered the site a prime opportunity to build luxury apartments overlooking the river. But the lender halted that process at the 11th hour a year later, instead choosing to retain ownership.
Since then London’s financial industry has grappled with the shock 2016 Brexit vote, which raised fears of an exodus from the UK capital. Former Canary Wharf Group Chairman and Chief Executive George Iacobescu, who spent decades developing the infrastructure that cemented London’s status as a global financial hub, was among the fiercest critics of leaving the European Union, warning it risked a gradual unravelling.
He’s now personally advising JPMorgan on the new development, a project that underscores London’s enduring appeal to investment banks even as most have been forced to bolster their footprints elsewhere in the EU.
JPMorgan currently operates in London primarily from two locations that it owns, 25 Bank Street in Canary Wharf and 60 Victoria Embankment, while the firm also leases space at another building. It plans to retain the Victoria Embankment site once the new headquarters is completed and will consider options for 25 Bank Street, according to the statement.
Last month, the finance group announced another £350 million investment plan in its Bournemouth campus for a new building and upgraded facilities.