JPMorgan Takes More Space in China’s Tallest Skyscraper With Growing Headcount
(Bloomberg) -- JPMorgan Chase & Co. and Nomura Holdings Inc. are taking extra office space in China with both increasing headcount in the nation as it opens its $45 trillion financial industry to more competition.
New York-headquartered JPMorgan boosted its space in Shanghai Tower, China’s tallest skyscraper, to 20,000 square meters (215,300 square feet) from 15,000 square meters, according to people familiar with the matter. Nomura, Japan’s biggest brokerage, nearly doubled the size of its lease to around 5,000 square meters, the people said, asking not to be identified because the details aren’t public.
Both institutions have been at the fore of China’s financial opening, laying out expansive plans to build their securities and asset management businesses in Asia’s largest economy and hiring along the way. As the liberalization gathers pace, it’s presenting the firms and peers, including Goldman Sachs Group Inc. and BlackRock Inc., with a tantalizing opportunity to more easily compete for a slice of the nation’s ballooning wealth.
JPMorgan’s expansion comes less than a year after it relocated to Shanghai Tower in the Lujiazui financial district because it needed more room. The lender has been hiring more in recent months, a person familiar said, without giving details.
“This is a strong vote of confidence in their China business,” said Daniel Yao, head of China research at Jones Lang LaSalle Inc. “Foreign asset management companies have been at the forefront expanding in Shanghai.”
The office expansion is part of a long-term plan after the bank announced last year that it wanted to have all its Shanghai-based employees in one place, JPMorgan said in an emailed statement.
A Nomura representative declined to comment.
As of this month, foreign companies can apply for 100% control of insurance and futures ventures in China. Come April, overseas players will be able to apply for licenses to start wholly owned mutual fund management firms.
According to China Center for International Economic Exchanges, global firms may plow 7 trillion yuan ($1 trillion) to 8 trillion yuan of assets onshore over the next few years.
JPMorgan and Nomura both already have majority-owned securities ventures in China. Nomura said last month that it expects its local headcount to climb to 500 by 2023 as it builds its wealth management business and expands into investment banking. JPMorgan CEO Jamie Dimon has said the bank is committed to bringing its “full force” to China.
Additional office requirements from foreign financial institutions will spur strong demand in Shanghai’s office leasing market this year, helping ease elevated vacancy rates, according to Ivy Lu, CBRE Group Inc.’s eastern China head of research.
Vacancy rates in the financial hub spiked to 19.4% at the end of last year, the highest since the depths of the global financial crisis a decade ago, according to CBRE.
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