Botin’s Vision of Future Pays Off for Santander in Age of Covid-19

(Bloomberg) -- As global banks grapple with how and when to safely bring back thousands of employees after the Covid-19 outbreak, Spain's two biggest lenders will be spared some of the headaches preoccupying rivals.

About two decades ago, Banco Santander SA's late chairman Emilio Botin returned from a trip to the offices of First Union Corp. (now part of Wells Fargo & Co) in North Carolina with an idea about the bank's future: to merge 20 offices Santander had in Madrid into a vast campus. He commissioned Pritzker Prize-winning architect Kevin Roche, who in 2002 began to build a financial city west of Madrid. The move set a trend, with Spain's second-largest lender BBVA starting its own complex in 2010 north of the capital.

Botin wanted enough space to accommodate the workers at the nerve center of his fast-expanding empire, complete with services such as daycare for children and sports facilities including a golf course. That vision may now be paying off in unexpected ways as Santander and BBVA start to bring employees back in one of the pandemic's hardest-hit countries. The low-rise structures at their corporate centers minimize issues such as crowded elevators and the need to take public transportation that are creating bottlenecks for rivals in London, Paris or Milan.

Santander's complex may not have been built with a pandemic in mind, “but now it's a competitive advantage,” said Ricardo Wehrhahn, managing partner at Intral Strategy Execution in Madrid, which advises banks. “You've got less population density, more space, modern offices and technology for access and parking, which means you can better adapt to crises like this one.”

The 8,000 employees that work at Santander's global corporate center are spread out over nine buildings, most of which are no higher than three floors. Santander said that 85% of employees travel by car, either using the underground parking lots or the street just outside the complex.

The complex includes a training center with an attached hotel, sports and health facilities and a replanted forest. Dotted over the site are 1,220 olive trees including 11 that are more than 1,000 years old. The lender recently bought back the property after having sold it for 1.9 billion euros ($2.1 billion) to Marme Inversiones, which filed for protection from creditors in 2014.

BBVA -- short for Banco Bilbao Vizcaya Argentaria SA -- completed its campus outside Madrid in 2015. Its seven low-rise offices are built around a plaza from which the La Vela, or Sail, tower rises. They're joined by cobbled streets covered with awnings and overhanging plants during summer and dotted with gardens, patios and waterways.

Herzog & de Meuron, the Swiss architecture studio best known for its refurbishment London's Tate Modern museum and Beijing's “Bird's Nest” Olympic stadium, said the complex was inspired by Arab gardens and designed to encourage people to use stairs instead of elevators.

More than 90% of the 7,000 employees that normally work at the campus are based in buildings no higher than two floors, which means they can avoid elevators, said Borja Eugui, head of facility management, construction and sustainability at BBVA. There's parking capacity for about half of the employees and private bus lines from the center.

“The ample, interconnected installations are clearly an advantage, especially in the first phases of reincorporation,” Eugui said by email. “As we incorporate employees we will reorganize work spaces.”

Companies large and small are rethinking their working environments to battle the pandemic and banks have a particularly difficult task as most have headquarters in busy areas such as London's Canary Wharf and downtown Manhattan. Restaffing offices will depend not just on what the banks decide but also on rules imposed by city officials and local transportation authorities.

London, Milan

Brookfield Asset Management, the landlord that owns Canary Wharf where 125,000 workers from banks such HSBC Holdings Plc, Barclays Plc and JPMorgan Chase & Co. commute each day, has set a limit of no more than six people on the estate's largest elevators and made office entrances and exits one-way. At the same time, Brookfield is trying to provide alternatives to mass public transport by making more parking spaces available for cars and bikes and increasing the service of river taxis.

Italy's biggest lenders took a different path when choosing locations for their headquarters. Unicredit SpA in 2013 moved to a glistening 31-story tower in Milan. Two years later, Intesa Sanpaolo Spa transferred 2,000 employees to a 39-floor skyscraper by Renzo Piano. Both are heavily limiting who can go back and have introduced strict rules for use of elevators and wearing of masks when moving about the building.

The back-to-work drive at Santander and BBVA's corporate centers may be less complicated, yet neither bank is taking chances. Madrid has been one of the epicenters of the Covid-19 outbreak with nearly a third of all Spanish cases occurring in the capital and nearly 9,000 deaths. Even as the health crisis has abated, the country's capital has been held back while other parts of Spain opened up.

BBVA says the return will be managed in stages and synchronized with the latest available data about the evolution of the virus. Central offices will have systems in place to measure temperatures and carry out tests when necessary. Digital fingerprint security will be disabled and external visitors won't be allowed.

Santander is for now allowing a maximum of 25% of its employees to return to offices on a voluntary basis, although only a few hundred are currently doing so and most are working half days before returning home. The lender is carrying out antibody tests on some employees.

“To protect both customers and employees, a comprehensive series of protocols has been put in place which include, among other things, an internal app that allows employees to report any symptoms, facilities to allow temperatures to be monitored, and the provision of protective material such as masks,” a Santander spokesman said.