Goldman Sachs has reaffirmed its commitment to London in spite of Brexit with a £1.17 billion sale and leaseback agreement for its European headquarters.
The US investment banking giant has agreed to sell its Plumtree Court office in London to Korea’s National Pension Service for £1.17 billion, alongside a 25-year lease on the building with an option to break after 20 years.
A statement from Goldman Sachs said that the deal will allow consolidation of the firm’s activities, which are currently located across three buildings, into one serviced location.
“The development of Plumtree Court and our signing of a long-term lease demonstrates our continued commitment to London and our European operations more broadly,” said Richard Gnodde, vice chairman and CEO of Goldman Sachs International. “We are delighted to have built a world class office for our people, enabling them to collaborate and serve clients in an efficient and attractive space.”
Goldman Sachs’ current CEO, Lloyd Blankfein, threw doubt over the bank’s decision to remain in London following the 2016 referendum, with a series of tweets suggesting its headquarters could move to Frankfurt.
Blankfein has also been a strong advocate for a second referendum. He is due to step down as CEO at Goldman Sachs at the end of September to retire, and will be replaced by David Solomon, currently chief operating officer at the bank.
Goldman Sachs added that the sale and leaseback of Plumtree Court is part of its long-term global real estate strategy, allowing the firm to capitalise on value created in developing the building while securing long-term occupation.
“This is one of the finest office buildings in London, which will be let to an exceptional tenant for 25 years,” Scott Kim, head of global real estate at Korea’s National Pension Service concluded.
“We are excited to re-enter into the London market with this high quality asset which is well-aligned with our defensive strategy and will be an excellent addition to our already strong core portfolio.”