Amazon is planning to take over some of Citigroup's office space in Singapore, at a time when a number of the US e-commerce giant's Chinese tech rivals are expanding here.
The online retailer will lease three floors covering about 90,000 sq ft at Asia Square Tower 1 in the heart of the financial district, according to people with knowledge of the plans. Staff will move into the new offices early next year, the sources said, asking not to be identified as the plans are not public.
Citigroup, currently the largest tenant there with nine floors, is trimming its office space to better use its real estate as its 10-year lease is due to expire soon, the people said.
Economic Development Board executive vice-president Kiren Kumar told The Straits Times that companies worldwide and from various industries continue to grow here to serve Asian and global markets.
In particular, tech sector companies are building capabilities in areas such as software engineering and cloud services, he said. "This will allow us to meet the growing demand for enterprise and consumer digital services in Singapore and Asia, and create meaningful jobs for Singaporeans in both tech and non-tech roles within the technology sector."
Amazon's plans here come as some of China's biggest tech firms, such as Tencent and ByteDance, make the Republic their beachhead for the rest of Asia. Singapore is becoming a regional base for both Western and Chinese companies because of its developed financial and legal systems. It is becoming more attractive to some as Beijing tightens its grip on Hong Kong.
"Amazon is always in a state of innovation and disruption," said Mr Justin Tang, the head of Asian research at United First Partners in Singapore. "Asia is a source of growth for them and they need to be near where their rivals are."
Amazon currently has about 200 job openings in Singapore for roles such as sales, according to its career site. It launched its Singapore website, which was also its first in South-east Asia, last year. A representative for Amazon declined to comment.
A spokesman for Citigroup confirmed it is giving up the space, but declined to say who is taking over. Some consumer banking staff, and employees in other functions, will relocate to Changi Business Park where the bank has bigger premises and a long-term lease, he said.
Amazon, which has been rapidly expanding in Singapore, has existing offices in Capital Square and One George Street. A lease for the space in Asia Square Tower 1 would typically be for more than five years.
Citigroup is among financial firms around the world grappling with what post-pandemic working life will look like, with some companies such as Nomura seeing opportunities to cut costly real estate by keeping a portion of staff at home.
Although the Singapore Government has eased some Covid-19 restrictions, remote work is still the default option.
Citigroup is reviewing its workspaces because of the virus and looking at other ways of working to allow flexible arrangements, the spokesman said. The bank on Tuesday said it will open its biggest wealth management hub globally in Singapore in December as it aims for double-digit growth in the nation.
BLOOMBERG
• Additional reporting by Prisca Ang
