From Bloomberg -- About 1.2 million square feet of office space will get an overhaul in the next 15 months to put technology experts closer to brokers, traders and bankers, the firm’s head of technology, Rob Rooney, said in an interview.
After changes to wealth-management operations, trading floors, investment-banking offices and space tied to asset management will all get a remake.
“The workplace needed to be designed around a much more dynamic, millennial kind of workforce,” said Rooney, who stepped into the technology role this year.
“We’re trying to attract the next generation of the best and brightest.”
Demolition work in lower Manhattan has already created open floor plans that give more employees views of the Statue of Liberty and Hudson River, a perk previously reserved for senior executives cloistered in their wood-walled offices.
Now, glass partitions and interactive whiteboards abound, and the dress code is decidedly more casual.
The first phase represents about 9,000 seats around the world, though the project may expand, Rooney said.
Morgan Stanley’s past technology investments helped make it the biggest stock-trading firm in the world, and Chief Executive Officer James Gorman has said it’s a major priority to replicate that success in bond markets.
The bank, which also has a $2.4 trillion wealth-management division, is spending $4 billion annually on the effort, including the building of what it calls “Centers of Excellence” to focus on blockchain, automation and other technologies.
With 18 million transactions a day on the firm’s electronic-trading platform for equities, pushing the efficiency envelope “is kind of challenging the speed of light,” Rooney said. “If you’re an engineer, these are real problems you’re trying to solve.”
In wealth management, where a lot of the initial office changes will roll out, the bank built algorithms and is using machine learning to help more than 15,000 brokers make trade suggestions for clients and handle more routine tasks.
The overhaul is one of Wall Street’s biggest. WeWork Cos. last year began helping UBS Group AG update wealth-management offices in Weehawken, New Jersey. Also in 2017, Goldman Sachs Group Inc. unveiled the largest revamp of its trading hub since 2009, when about 500 asset managers were moved into an open floor plan.
Modernization isn’t optional for a firm like Morgan Stanley, said Ekene Ezulike, global head of corporate services. “The question is how quickly we do it, versus whether we should do it,” he said.
As little as 60 percent of Morgan Stanley’s work space is occupied at any given time, according to Ezulike, who said the changes will push that rate as high as 90 percent as options such as desk sharing let more people use fewer seats.
Despite the less stuffy dress code and other updates, Morgan Stanley shouldn’t be confused with a Silicon Valley startup, Rooney said.
“We’re not a technology firm, we’re a bank,” Rooney said. “We don’t sell technology, we sell advice.”
While there’s no kombucha on tap as there is at Goldman Sachs’s revamped San Francisco offices, there are common dining rooms, and the firm hired its first-ever community manager, Fiona Thomas. She helps plan office get-togethers and is overseeing a meditation event that was oversubscribed.
Morgan Stanley’s executives approved the project, called “Workplace Evolution,” in March and some spaces were fully revamped in months, with help from WeWork and the architectural firm Gensler. The first set of changes included offices in New York, Houston, Frankfurt, Chicago, Glasgow, Budapest, London, Mumbai and Bangalore.
The firm’s headquarters in Times Square -- which is about 1.3 million square feet -- will also see changes, Rooney said. The capital-markets division for the wealth-management unit will be revamped this year. The technology division and back-office functions tied to finance are also being renovated.
“Our traders need to be with our techies,” Rooney said. “You’ll see a very different trading floor in five years time than you see today.”