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Citigroup Inc. (NYSE: C)
March 19, 2009
Citi Clarifies Media Reports about Office Consolidation
New York - In response to numerous misleading media reports regarding the office consolidation at Citi's global headquarters at 399 Park Avenue, Citi issued the following points of clarification:
* The consolidation of our executive headquarters at 399 Park Avenue is part of an ongoing global effort to substantially reduce expenses.
* Over the last two quarters, reported premises and equipment expenses are down by $100 million, and Citi expects to realize significantly more savings in 2009.
* Globally, office density will be 120 usable sq. ft. per person by the end of 2009, down from 132 usable sq. ft. per person currently.
* The consolidation of the executive headquarters at 399 Park Avenue is part of the global cost savings initiative and will result in the reduction of space on the executive floors by 50%, going from two floors to one and subleasing the remaining space.
* This consolidation and subsequent costs are for all executive office space at 399 Park Avenue, not just the CEO's office.
* Citi is doubling the overall occupancy rate on the remaining floor at 399 Park Avenue by creating smaller offices, increasing work station to office ratios, and by utilizing alternative work strategies.
- Occupancy on the remaining floor goes to 177 from 89 currently.
* The 399 Park Avenue office space consolidation, through densification and sublease, is estimated over the life of the lease to net $20 million in savings, an amount well in excess of the project costs. This estimate is based on conservative assumptions regarding the price and timing of the sublease.
* This consolidation is about cost savings and anything reported to the contrary is misleading.
Premises and Equipment Expenses
$1.834 B $1.737 B
(Source: Citi 4Q08 Financial Supplement)
Total Global Real Estate Space (million square feet)
Q208 Q408 Projected Q409
100.2 94.3 83.9
Selected 2008/2009 Site Dispositions (New York City only)
250 West Street: 371,625
77 Water: 94,252
731 Lexington Ave: 176,030
333 W. 34th: 338,411
787 Seventh Ave: 270,311
Citigroup Center: 175,076
Thursday, March 19, 2009
Posted by Tyler Durden at 6:08 PM
Nothing like the threat of little public lynching to get transparency...