HP to shrink its office space

HP plans to consolidate its sprawling real estate holdings into more densely packed locations as part of its ongoing cost-reduction plan, the company announced on Thursday.

The four-year review of HP's real estate kicked off a little less than a year after CEO Mark Hurd announced plans to aggressively cut costs within the company. Under the new programme, HP wants to reduce the number of offices it maintains and to have a smaller number of "core sites", it said in a press release.

Over several years of acquisitions, HP has accumulated quite a lot of real estate, according to a company spokesman. "We're an amalgamation of four companies over the years," he said - referring to HP's major purchases of Compaq, Digital Equipment and Tandem. That doesn't include dozens of other smaller acquisitions, such as deals with AppIQ, Peregrine Software and Snapfish, which had their own facilities.

HP hopes to use the savings from the consolidation to upgrade its so-called core sites with new technology designed to make it easier for mobile workers to get their work done, the spokesman said. This includes things such as mobile workspaces, or "hotelling", and more technology in common areas such as cafeterias and coffee rooms.

The consolidation efforts will be spread around the world, he said. HP, which is headquartered in Palo Alto, California, has not released plans for specific facilities or geographical areas.

The real estate initiative follows plans to consolidate HP's data centres from 85 separate locations to six. The company also recently announced plans to reorganise its supply chain activities.

Tom Krazit writes for CNET News.com