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REI said Wednesday that it is looking to sell its new headquarters campus near Seattle to bolster its finances amid a steep pandemic-related sales slump.
The outdoor equipment cooperative had big dreams for a new corporate campus in 2016, when it announced plans to move from Kent, Washington, to the Bellevue Spring District, 20 miles from Seattle, offering its 1,400 employees the central office the latest office amenities. Those should have included features like two large outdoor patios connected by bridges and a facade with large windows and garage doors that roll up, according to Fast Company.
Unfortunately, due to the COVID-19 outbreak that led to REI stores closing for weeks, this is not the case. REI CEO Eric Artz told employees in a video call Wednesday that selling the newly completed campus, which staff were due to move to this summer, will likely generate profits and put the company on a more secure financial footing.
“These dollars would also play an important role in stabilizing our business through the ongoing impacts of current disruptions,” Artz said, according to a transcript of the call shared with us. The CEO noted that REI’s business had done better than initially feared, but warned: “The pandemic is far from over.”
Before the emergence of COVID-19, REI had been on a roll. Sales increased 12.3% last year to reach $ 3.1 billion. However, REI continues to open stores.
Rather than a sleek new headquarters, REI will have several smaller satellite offices in Greater Seattle that will reduce employee travel time. The company says this approach will make it easier to attract talent who may not be willing to relocate to the greater Seattle area. Artz expects most of the headquarters staff to work from home at least until the end of this year.
You are not the only CEO facing this dilemma. Shopify CEO Tobi Lütke told us in May that he expects most staff to work remotely in the future, well beyond the pandemic, and is reconsidering office space.
At the same time, many corporate CEOs worry about the long-term impact on culture, creativity, and teamwork of having people scattered through the winds. CEO of Walmart Doug McMillon told shareholders in June: “How do you get to know people? How do you get an idea of what culture is like? The culture within a company is a very important aspect ”. That company is moving forward with its plan to open a new headquarters campus in 2025.
But in REI’s case, a new, modern campus would have been a luxury that must, for the moment at least, be relegated to the fundamentals of its business.
