HSBC leases new Canary Wharf office after return-to-office desk shortage
The decision to take 11 floors at 40 Bank Street, another skyscraper near the landmark HSBC Tower, which it will still vacate in 2027, is a tacit admission that it got its post-pandemic downsizing wrong.
In 2023, HSBC announced it would be exiting its 1 million sq ft Canary Wharf headquarters in favour of a new building next to St Paul's Cathedral, roughly half the size.
That one of its largest, most prominent tenants was leaving was a blow for the Wharf, which at the time was seeing a succession of tenants making the move to the Square Mile.
However, since Georges Elhedery, HSBC's new chief executive, joined last year, the bank has been looking for more office space in London. With more people having returned to the office, HSBC was worried that it would need almost 8,000 more desks than would fit in its new HQ.
In total, HSBC will have about 710,000 sq ft of office space in London from 2027, which is not much less than it was using at its current tower before the pandemic. Although that 45-storey building is 1 million sq ft in total, HSBC has for some time not used a number of those floors.
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Suzy White, who was appointed chief operating officer last October, said the group was 'delighted to be retaining a presence in Canary Wharf', adding: 'Continuing to operate from multiple sites in London, as we always have, ensures we are easily accessible for our clients across the capital and remains a key element of our business continuity strategy.'
Shobi Khan, chief executive of Canary Wharf Group, said he was 'thrilled' to be keeping HSBC in the Wharf. 'This letting reflects the enduring appeal of our mixed-use neighbourhood where commerce, community and culture thrive,' he added.
HSBC's lease at its current tower expires in 2027, at which point C WG, co-owned by Brookfield, the Canadian investor, and the Qatar Investment Authority, is planning a dramatic overhaul.
ALAMY
Chunks are likely to be taken out of the façade to give it a different look, and it will cease to be just an office block: in addition to workspace, architects are exploring how they can work in other uses, including a hotel.
HSBC's U-turn is the latest piece of welcome news for Canary Wharf, which has seen the tide of negativity it has faced in recent years begin to turn in its favour.
BBVA, Spain's second-largest bank, agreed this week to expand its office and extend its lease. Others to have recommitted to staying in the area include Barclays, JP Morgan, Morgan Stanley, Revolut and Citibank, which is spending a reported £1 billion renovating its own skyscraper.
CWG has been trying to win over tenants by investing heavily to improve the area and create more of a 'community'. It has spent £7 billion since the pandemic on opening the access to the waterways, improving the public realm and building blocks of flats, new shops and restaurants.
Agents, however, think there is a more straightforward reason as to why businesses are starting to look more favourably at Canary Wharf again: money. Such is the demand for 'prime' office space that there is next to nothing available in either the West End or the City, and where floors are available, landlords are asking for twice as much rent compared with Canary Wharf.
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