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Goldman Sachs boosts post-Brexit plans with Frankfurt office deal

The Frankfurt skyline. Goldman Sachs’ new home in the city is still under construction and will not be ready until late 2019.
The Frankfurt skyline. Goldman Sachs’ new home in the city is still under construction and will not be ready until late 2019. Photograph: Michael Probst/AP

Goldman Sachs has begun to make plans for Brexit by leasing space in a new Frankfurt tower block that could hold up to 1,000 staff.

The Wall Street bank, which employs 6,000 staff in the UK, has been searching for office space in the German financial centre for the last six months as it looks to continue operations across the EU after Brexit.

The bank is taking the top eight floors of a new 37-storey block known as Marienturm, which is under construction and expected to be ready for occupation in the third quarter of 2019. It currently has just 200 staff in Frankfurt.

“This expanded office space will allow us to grow our operations in Germany to continue serving our clients, as well as provide us with the space to execute on our Brexit contingency plan as needed,” Goldman Sachs said.

Richard Gnodde, chief executive of its international arm, has previously said the bank’s plans include hiring extra staff in the remaining 27 EU nations to cope with the extra business which will be channelled through Europe instead of London.

The bank did not say what the implication was for jobs in London, but the news came amid warnings that unless a transitional deal can be agreed with the EU before Christmas firms could have to start taking steps to move jobs and business out of London on the assumption there will be a hard Brexit.

Sam Woods, a deputy governor at the Bank of England, told an audience of financiers this week that the further away an agreement is from Christmas, the less effective it would be in helping to reassure City firms about the changes they need to cope with the UK’s departure from the EU.

He has already asked 400 financial firms which operate in the UK for their Brexit plans and is monitoring their responses.

For Goldman Sachs, the UK’s departure from the EU in March 2019 coincides with its scheduled move into a new 10-storey building under construction in London that is intended to replace its three offices in the capital. The bank has the option to take all the floors or sublet space.

Gnodde has said previously that job numbers would depend “on the outcome of [the Brexit] negotiations and what we are obliged to do because of them” amid speculation that up to half of its 6,000 London-based roles could go.

According to a tally of job announcements kept by the City of London Corporation – the local authority for much of the financial district – Frankfurt is in the lead of all the remaining EU cities in attracting roles. More than 9,750 potential job moves have so far been announced.