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Morgan Stanley has agreed to stay in its Canary Wharf office for another 14 years in a big boost to the east London financial centre that has been hit by high-profile tenant departures.
The US investment bank has added a decade to the lease on its European headquarters at 20 Bank Street, extending its tenure from the current end date of 2028 to at least 2038.
The deal with Canary Wharf Group, which owns the 14-storey building, ends months of speculation about the bank’s plans after several other big financial sector tenants quit Canary Wharf for the City of London.
The bank’s decision to sign a long-term lease extension marks one of the most significant votes of confidence in Canary Wharf since those departures called into question the area’s appeal to its traditional core tenant base of large financial businesses.
The district’s office towers, which attracted banks including Morgan Stanley when the area was first developed, have become less popular with some tenants as working patterns have shifted since the Covid-19 pandemic.
“Canary Wharf has been the location for our Emea headquarters for over 30 years and we’re pleased to be extending that tenure” said Chris Beatty, Morgan Stanley’s chief operating officer for Europe, the Middle East and Africa.
As part of the deal, CWG agreed to fund an extensive refurbishment of the 547,000 sq ft building, completed in 2003, including upgrading the building’s energy efficiency.
Morgan Stanley said it also plans to keep office space at nearby 25 Cabot Square.
CWG, the landlord and manager of much of the Docklands financial centre, has been trying to keep big office tenants while diversifying beyond financial services by adding life sciences occupiers, housing and leisure amenities.
Shobi Khan, CWG chief executive, said tenants valued Canary Wharf’s “vibrant mixed-use neighbourhood” and “diverse leisure and amenities”.
High-profile tenants who have announced their departure include the bank HSBC, financial data provider Moody’s and law firm Clifford Chance. Staff of failed bank Credit Suisse will move into UBS’s office in the City this year.
Barclays late last year agreed a 5-year lease extension on its headquarters, taking its tenure to 2039. It also paid CWG at least £260mn to hand back the tenancy of a second building that the bank no longer occupied.
Two big US banks, JPMorgan and Citi, are considered likely to stay put since the banks own their buildings. Fintech firm Revolut is in talks to take new space on the estate for its headquarters.
