Chongqing Tiandi Case
1. Issues
Unilever House, a 70-year-old building in London, is no longer a pleasant place to work with its current poor amenities, high operating costs and inappropriate interior design. In order to revitalize utilization of workspace, encourage collaboration and efficiency and further promote Unilever performance, the management has to deal with several issues.
1. Should Unilever redevelop Unilever House or move out to some other appropriate places?
2. If they decide to redevelop Unilever House, how can they finance all costs?
3. If they decide to move out, which place should they choose?
4. Does the design work?
5. Are Stanhope's interests properly aligned with management's interests?
2. Alternatives
After denying small renovation and relocation in another continent or country due to little impact on operating efficiencies and foreseeable future for the European-based company, there are three potential alternatives to deal with the company’s central office.
The first option is that the Unilever House would be re-developed on the site where the old building would be demolished and replaced by a friendly environmental building with 250,000 square feet of net usable space. The company would hire Stanhope PLC, a London-based developer, and Kohn Pedersen Fox, an international architect firm, for construction and development of the building. The total cost of the project would approximately be £110.8 million within 3 years. The company could use external financing (sale-leaseback, borrowing) and/or internal source (cash). The newly built eight-storey office headquarter of the green construction process would be installed flying carpets, meeting space and walkways between floors, space trumpets, hang in the atrium and rotate at certain time, transparent walls on each floor and a glass-made back wall. The building could be subleased the first four floors while the rest would be the company’s employee workspace with gym, wellness, and dentist’s office located below
Unilever House, a 70-year-old building in London, is no longer a pleasant place to work with its current poor amenities, high operating costs and inappropriate interior design. In order to revitalize utilization of workspace, encourage collaboration and efficiency and further promote Unilever performance, the management has to deal with several issues.
1. Should Unilever redevelop Unilever House or move out to some other appropriate places?
2. If they decide to redevelop Unilever House, how can they finance all costs?
3. If they decide to move out, which place should they choose?
4. Does the design work?
5. Are Stanhope's interests properly aligned with management's interests?
2. Alternatives
After denying small renovation and relocation in another continent or country due to little impact on operating efficiencies and foreseeable future for the European-based company, there are three potential alternatives to deal with the company’s central office.
The first option is that the Unilever House would be re-developed on the site where the old building would be demolished and replaced by a friendly environmental building with 250,000 square feet of net usable space. The company would hire Stanhope PLC, a London-based developer, and Kohn Pedersen Fox, an international architect firm, for construction and development of the building. The total cost of the project would approximately be £110.8 million within 3 years. The company could use external financing (sale-leaseback, borrowing) and/or internal source (cash). The newly built eight-storey office headquarter of the green construction process would be installed flying carpets, meeting space and walkways between floors, space trumpets, hang in the atrium and rotate at certain time, transparent walls on each floor and a glass-made back wall. The building could be subleased the first four floors while the rest would be the company’s employee workspace with gym, wellness, and dentist’s office located below