British Petroleum – BP – is in the midst of a potential departure from its iconic London HQ as the company notes increases in remote work and flexible working arrangements, according to a report.
The Times is writing that BP is planning on vacating its headquarters in Central London as it eyes smaller office spaces as employees continue to work on a flexible, or remote basis.
The report says that BP “has hired JLL to advise, [and] will take a smaller London HQ when it leaves St James’s.”
BP employs 6,500 staff in the UK, and has in the past signalled that the company will, in the future, move to a mixture of remote and flexible working arrangements with its staff after the COVID-19 pandemic forced the company into new working arrangements.
The main reason behind the author’s forecast that BP will be leaving or downsizing its offices is down to recent remarks from CEO Bernard Looney who said that there was “no question that work patterns are changing,” in light of the pandemic.
Looney, who became CEO in February of this year added that “it’s too early to say what the impact will be on workspace, but it’s unlikely that we will need more workspace and more likely that we will need less workspace over time.”
According to that report, BP will continue its lease in St. James’s Square for two years, and then vacate the premises. Sabah Meddings and Sam Chambers write that “shifts in behaviour brought on by the coronavirus have cast a cloud of uncertainty over the property market. A sale of BP’s building on St James’s Square, expected to be priced at more than £300, will be a key test of appetite for prime London floorspace.”
The authors state that across England’s 63 largest urban areas, just 17% of the working population were back behind their physical desk, while the majority remained at home, or working on a flexible basis.
Famed real estate agent in London, Savills says it expects office vacancies to hit 7.2% in the City of London next year, which would be the highest rate of empty offices since the 2008 Global Financial Crisis.
BP has previously moved to cut thousands of jobs from its 70,000-strong workforce, including 2,000 cuts to its UK workforce, as well as reducing its dividend to shareholders after announcing losses for the second-quarter totalling USD $17.7 billion.
Authors of the report say that the St James headquarters was purchased in 2001 for £117 million, and could sell for as much as £300 million.
BP has not addressed the claims directly, but has released a statement saying that the company does not comment on “rumour or speculation.”