As the pandemic rages on and timelines for when workers can return to offices continue to be pushed back, more firms are looking to cut their office real estate holdings.
One example: WPP, the British advertising giant that’s the parent company of Ogilvy and GroupM, will reduce its New York City office space by 700,000 square feet, about a third of its footprint, Business Insider reported.
The measure is part of the company’s plan to cut its global real estate costs by up to 20 percent in the next five years.
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Spike in Manhattan’s office sublease explained
The lion’s share of that will come from closing Ogilvy’s headquarters at 636 11th Avenue, where it has about 550,000 square feet, according to the publication, though some of that has been subleased over the years. The ad agency will move to 200 Fifth Avenue, where Grey Group, another WPP subsidiary, is already located.
AKQA, a digital design and communication agency, will leave 114 Fifth Avenue and join other WPP companies, including GroupM and Wunderman Thompson, at 3 World Trade Center. And finally, Geometry will vacate 636 11th Avenue as it merges with VMLY&R at 3 Columbus Circle.
Ogilvy declined to comment, and a WPP spokesperson did not immediately respond to a request for comment from the news outlet.
The advertising sector has been among the hardest hit industries due to the pandemic. Earlier this year, R/GA, a global advertising agency, slashed the size of its 173,000-square-foot headquarters at Brookfield Property Partners’ 5 Manhattan West by 65 percent. [BI] — Akika Matsuda