Apple announced on Wednesday that it would move its London headquarters to the Battersea Power Station, a historical landmark currently being revamped as the center of a new upscale district encompassing shops, restaurants, and hotels.
News of the move, slated for 2021, comes in a post-Brexit era that many analysts believed would be characterized by catastrophic economic effects. The British government says the announcement shows the country's continued status as a magnet for investment following the June vote to leave the European Union.
"It's another vote of confidence in the UK economy," finance minister Philip Hammond told Reuters, "sending a clear signal that companies are continuing to invest in Britain's future, and that we are one of the most attractive investment destinations for the global technology industry."
Campaigners for the movement to remain in the EU had warned that adverse economic effects would follow if the British public chose to leave the bloc. The morning after the vote seemed to bear out those warnings, with global stocks tumbling, reported The Christian Science Monitor:
As economists had estimated in anticipation of a potential leave vote, last night’s outcome led to a 10 percent drop in the value of the British pound – and a decline in the value of the Euro – compared to the US dollar to its lowest level in more than three decades. As of Friday morning, £1 was worth $1.37.
Given America's deep ties with Britain, worth trillions in investments flowing both ways, the decision sent the markets into a freefall in the US, too. The Dow was down nearly 400 points, or about 2.1 percent, in mid-morning trading. The S&P 500 was down around 50 points at 10:30 am ET. Despite the ominous market response, over the long term there won’t be much of a dent here, predicts at least one analyst.
“Today is just a classic market reaction,” which could last for weeks, Greg McBride, chief financial analyst at financial information repository Bankrate.com, tells The Christian Science Monitor.
But this month, the Monitor reported that despite those first negative aftershocks, the post-Brexit period has so far brought no such economic calamity. Nor have multinationals pulled up anchor and fled the country, as some analysts had predicted.
Nearly three months after the referendum, the roaring unemployment some economists predicted has been just a purr. In fact, the unemployment rate has improved, and a historic three quarters of Britons who can work have jobs, according to a survey the British Office for National Statistics (ONS) released Wednesday.
The country’s unemployment rate for May to July fell 0.6 percent from a year ago, from 5.5 percent to 4.9 percent, according to ONS. The employment rate was 74.5 percent for those three months, with 559,000 more Britons employed than a year ago.
The survey has upset dire forecasts about the immediate blowbacks of Brexit. But economists are divided over what this means in the long run. Some argue the survey contains other indications the worst is yet to come, such as the slowdown in wage growth. Others say it shows the resiliency of the British economy.
The Battersea station, whose construction dates back to the 1930s, is widely recognizable for its art deco chimneys. Abandoned for decades, it was bought in 2012 by a Malaysian consortium. More than 4,000 homes have been built at the site in addition to the array of businesses, with the first residents set to move in over coming months.
Apple said it was looking forward to "this magnificent new development at one of the city’s best-known landmarks," in a statement to The Evening Standard. "This is a great opportunity to have our entire team working and collaborating in one location while supporting the renovation of a neighbourhood rich with history."
Apple employees currently work across nine different London sites.
Apple's main European headquarters will remain at Cork, Ireland, where it employs 6,000 people and takes advantage of a lower tax rate, reports The Evening Standard. About 1,400 Apple employees will leave their current London offices for the Battersea site, which will be one of Apple's largest campuses outside the United States, that will occupy six floors in the central boiler house of the former coal-fired power station.
This report contains material from Reuters.