SINGAPORE (BLOOMBERG) – Amazon is planning to take over some of Citigroup’s office space in Singapore at a time when a number of the e-commerce giant’s Chinese tech rivals are expanding here.
The online retail giant will lease three floors covering about 90,000 sq ft at Asia Square Tower 1 in the heart of the financial district, according to people with knowledge of the plans. Staff will move into the new offices early next year, the sources said, asking not to be identified because the plans are not public.
Citigroup, currently the building’s largest tenant with nine floors, is trimming its office space to better use its real estate as its 10-year lease is due to expire soon, the people said.
Amazon’s plans in Singapore come as some of China’s biggest technology corporations such as Tencent, Alibaba Group and ByteDance make the island-state their beachhead for the rest of Asia. Singapore is becoming a regional base for both Western and Chinese companies because of its developed financial and legal systems. It is becoming more attractive to some as Beijing tightens its grip on Hong Kong.
“Amazon is always in a state of innovation and disruption,” said Justin Tang, the head of Asian research at United First Partners in Singapore. “Asia is a source of growth for them and they need to be near where their rivals are.”
Amazon currently has about 200 job openings in Singapore for roles covering data analytics, sales and advertising, business development, and marketing and public relations, according to its career site.
A representative for Amazon declined to comment. A spokesman for Citigroup confirmed that the bank is giving up the space, but declined to say which tenant is taking over. Some consumer banking staff, and employees in other functions, will relocate to Changi Business Park where the bank has bigger premises and a long-term lease, he said.
Amazon, which has been rapidly expanding in Singapore over recent years, has existing offices in Capital Square and One George Street. A lease for the space being taken in Asia Square Tower 1 would typically be for more than five years.
Citigroup is among financial firms around the world that are grappling with what post-pandemic working life will look like, with some companies such as Nomura and Fifth Third Bancorp seeing opportunities to cut costly real estate by keeping a portion of staff at home.
Although the Singapore Government has eased some restrictions around the virus, such as allowing more workers to return to the office, remote work is still the default option.
Citigroup is reviewing its workspaces because of the virus and looking at other ways of working to allow flexible arrangements, the spokesman said.
The bank on Tuesday (Sept 29) said it will open its biggest wealth management hub globally in Singapore in December as it aims for double-digit growth in the nation. The facility, called Citi Wealth Hub at 268 Orchard, will open with space for more than 300 relationship managers and product specialists.