Is JPMorgan Chase Bailing on New York City?

Those who persist in remaining optimistic about New York City often point to the giant expansion of Facebook. It is currently developing a massive complex in Midtown west.

On the other side of the ledger, JPMorgan Chase, a leading financial services firm is bailing on the city. Or so it would seem. True enough, the bank insists that it will build a new headquarters in Manhattan. In the meantime it is putting a large block of real estate up for sublease. To be fair, if you wanted to get out of your lease by subleasing you would be well advised to tout your optimism about the city’s future.

We remark in passing that Conde Nast, a major tenant of the World Trade Center has been trying to do the same with its lease.

Anyway, here is the story. For the record the number is 800,000 sq. ft.

JPMorgan Chase is looking to sublet big blocks of office space in Manhattan, Bloomberg News reported on Tuesday, citing people with knowledge of the matter.

The bank is looking to sublet just under 700,000 square feet at 4 New York Plaza in the Financial District and more than 100,000 square feet at 5 Manhattan West in the Hudson Yards area, the report said.

Why is it doing this? For one, it does not believe that New York City is going to recover. It does not believe that office workers will be returning to their desks in midtown Manhattan:

Due to COVID-19 pandemic-led lockdowns and stay-at-   home orders, fewer people have been going to office, which has prompted companies to reassess the need for real estate.

“It is too early to comment on specifics as we continue to learn and adapt to this current situation and how it impacts our commercial real estate needs. We are committed to New York and are planning for the next 50 years with our new headquarters here,” a spokesperson for the bank said.

Is New York City done yet? If it isn’t, it’s circling the drain.