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Microsoft has announced it is abandoning plans for a new office complex in London, citing the need to cut 10,000 jobs this year as the driving factor behind its decision. The move highlights the extent to which the tech giant’s broader cutbacks will impact its real estate needs.

In an email statement, Microsoft confirmed its commitment to the UK, stating that it has facilities nationwide. The company’s decision follows an announcement in January that it would reduce its workforce by 5% this year as part of a broader industry trend towards job cuts and remote work, which has strained office real estate demand.

The Microsoft office leases in Reading, England, expire in 2026 and were intended to be replaced by the new London complex. If Microsoft will now renew the office lease in Reading is not clear. Microsoft didn’t comment on future office plans in the UK.

Like other tech vendors, Microsoft is cutting jobs across the board, and expansions in every region are being looked at. Microsoft also is investing a lot in hybrid work, which means they need less office space around the globe.

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