Barclays PLC., the U.K.-based financial institution has reportedly cut down on 60,000 square feet of office space in suburban Singapore to move its operations to the financial district in the heart of the city. LinkedIn Corp., the professional social networking website has now leased the space.
Sources familiar with the matter told Bloomberg that Barclays is moving its operations to cut down costs. The shift comes after it recently moved from Chiangi Business Park, relocating about 200 employees.
But Barclays is not just shifting to cut costs. It is also eliminating jobs to boost profitability. According to TIME, the banking giant's current move to Marina Bay will affect about 300 back-end process officials. The company also plans on slashing 12,000 jobs in the coming months.
Experts say this is a clever move.
"If you don't have the size or scale, it's better to be operating from one building. The decision could be one of scale, of efficiency and of being able to consolidate under one roof despite current rentals being higher at Marina Bay Financial Centre," Donald Han, managing director of Chesterton Singapore, a real estate consultancy told TIME.
While Barclays is vacating the suburban building, LinkedIn has lapped up all the space. The professional social networking website opened its Singapore headquarters in 2011. The fast-growing tech firm already has offices in the AXA Tower in the financial district but is now expanding.
LinkedIn's expansion doesn't come as a surprise because the company recently crossed the 300-million-member milestone and is growing leaps and bounds. Of late, it has been in talks with leasing offshore office properties in cities like Dublin.
Meanwhile, the Singaporean suburbs have been attracting several tech giants to the area. The Lion City is set to become the "Silicon Valley" of Asia with bigwigs like Facebook, YouTube and MSN opening shop in the city.
"With the Government co-investing 85% of the capital up to $500,000, it is no wonder that Singapore is touted as Asia's Silicon Valley," James Nuben, Head of Taxation at AsiaBiz Services said in a statement.
"It is undeniably lucid that Singapore has the right mix of capital flow, optimal environment, and ability to entice the big names in the tech universe to evolve into Asia's Silicon Valley," Nuben explained.
