As the wider brokerage industry figures out how to cut real estate costs in a work-from-home era, one firm, Charles Schwab Corp., said Tuesday it was closing offices in five cities because employees in those locations are now working from home.
Large firms like Schwab typically occupy huge offices in prime, and expensive, downtown locations in large cities across the country. Schwab is closing offices in Atlanta, San Antonio, San Diego, St. Louis and Tampa, Florida, according to a statement from the company, and approximately 5% of its staff are assigned to those locations.
The company said more cuts to real estate will occur in the following locations: Boston, Chicago, San Francisco, Jersey City, New Jersey, and Henderson, Nevada, a suburb of Las Vegas. Schwab will be closing floors or offices and then relocating the people working in those locations to offices in a similar geography in those cities.
Schwab is the largest custodian to thousands of independent financial advisors who are registered investment advisors, and it's currently working to finalize the transfer of accounts from TD Ameritrade Inc., a rival which Schwab bought in 2020.
While those RIAs don't work in Schwab offices, which house Schwab's own network of financial consultants and support staff, some RIA advisors who use Schwab as a custodian closely watch the operations of the company.
"These offices, that’s to be expected," said one financial advisor whose RIA uses Schwab to custody client assets. "They’re going to cut costs. It looks like the consolidation of retail branches is pretty much done, and Schwab has been methodical about it."
The changes in working environments and locations will have no impact on client service, a Schwab spokesperson wrote in an email.
"In an effort to efficiently use resources to support our clients, our employees, and our stockholders, we have evaluated our real estate footprint," the spokesperson said. "We will close some of our smaller locations with modest levels of in-office attendance or reduce or move our footprint in others. There are no changes to our larger centers and corporate campuses or to our branch footprint."
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