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NEW YORK CITY-Citigroup will consolidate space at its global headquarters, 399 Park Ave., and is looking to reduce its global real estate footprint by about 10.5 million square feet by year’s end, the financial services company said late Thursday. It’s part of “an ongoing global effort to substantially reduce expenses,” according to a statement.

Consolidation at 399 Park will take the form of cutting the executive floors from two to one and subleasing the remaining space. This is estimated to save $20 million over the life of the lease, according to Citigroup. The company says it will double the overall occupancy rate on the remaining floor at 399 Park–from 89 to 177–by creating smaller offices, increasing work station to office ratios and by utilizing “alternative work strategies.”

Worldwide, Citigroup says the outcome of the space consolidation will result in office density of 120 square feet per employee by the end of 2009–down from 132 square feet currently. “Over the last two quarters, reported premises and equipment expenses are down by $100 million, and Citi expects to realize significantly more savings” this year, according to a statement. “This consolidation is about cost savings and anything reported to the contrary is misleading.”

The company’s office space occupancy as of the end of last year was 94.3 million square feet. By the end of ’09, that will be reduced to 83.9 million square feet.

Some of that consolidation will be done on the back of Manhattan office space dispositions, according to Citigroup. They include: 371,625 square feet at 250 West St., 338,411 square feet at 333 W. 34th St., 270,311 square feet at 787 Lexington Ave., 176,030 square feet at 731 Lexington Ave., 175,076 square feet at Citigroup Center and94,252 square feet at 77 Water St.

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