Bank of America looking to bump tenants from its uptown headquarters, sources say

Bank of America in recent weeks has been asking tenants if they would be willing to leave the bank’s uptown headquarters before their leases are up as the company looks to use the space itself, multiple sources have told the Observer.

The request means tenants could face a potentially disruptive move and lose a prestigious address in the city’s tallest office building. The bank has also asked tenants in neighboring 1 Bank of America Center if they would be willing to leave, the sources said.

It’s not clear how many tenants have been asked to move and if any have agreed to do so. The bank has indicated it would help tenants cover costs associated with early moves, said the sources, who spoke on condition of anonymity to protect business relationships.

Jennifer Darwin, a spokeswoman for the Charlotte-based bank, declined to comment.

The directory in the corporate center lobby lists more than a dozen third-party tenants, including Ernst & Young and McKinsey & Co. One of the bigger tenants that has been asked to move from the 60-floor tower is the Moore & Van Allen law firm, the sources said. The law firm, which also does business with the bank, declined to comment.

In recent years, Bank of America has taken steps to shrink its office space worldwide as it looks to cut costs at a time when low interest rates are crimping industry profits.

In his annual letter to shareholders this year, Bank of America CEO Brian Moynihan said the bank has reduced its real estate footprint over time by 34 percent, or 44 million square feet. “To put that in context, the Empire State Building is roughly 3 million square feet,” Moynihan wrote.

The latest move comes a little more than a year after Bank of America dropped Charlotte-based Lincoln Harris as the manager of its buildings in the Southeast, reducing the number of major real estate firms it works with from three to two. Chicago-based JLL, formerly known as Jones Lang LaSalle, now handles Southeastern work for the bank.

At that same time, the bank also shifted employees in its corporate real estate group to JLL and CBRE, another national real estate firm. A small number of real estate staff remained at the bank to manage relationships with the two firms.

In its annual report, Bank of America said it owns or leases 84.3 million square feet in 22,512 “facility and ATM locations globally,” with 78.4 million square feet of that space in the U.S.

“We continue to evaluate our owned and leased real estate and may determine from time to time that certain of our premises and facilities, or ownership structures, are no longer necessary for our operations,” the bank said.

In 2012, Bank of America sold the Fifth Third Center and the Hearst Tower in Charlotte and leased back space, as part of an effort to shed non-core assets and improve efficiency.

Bank of America owns the corporate center and the 1 Bank of America Center. The bank’s annual report says the corporate center has 1.2 million square feet, but doesn’t say how much the bank occupies.

In the third quarter of this year, uptown Charlotte had total office space of 17.5 million square feet, with a vacancy rate of 9.1 percent, according to a JLL report. That compared with a citywide vacancy rate of 11.8 percent.

This story was originally published October 6, 2016 at 12:10 PM with the headline "Bank of America looking to bump tenants from its uptown headquarters, sources say."