Arco to Vacate 2 Floors of Tower

Just as Chicago’s Sears Tower lost Sears and the Chrysler Building in New York hasn’t housed a Chrysler employee in decades, Arco Plaza may say goodbye to Arco.

Atlantic Richfield Co., which is working up to a major cost-cutting announcement, said it will move its top executives out of the upper two floors of Arco Tower, one of the twin 52-story landmark buildings on Flower Street in downtown Los Angeles, and may quit the building altogether.

Even if Arco decides to leave Arco Tower, where it occupies 11 floors, the oil giant would keep its headquarters downtown, spokesman Lee Tashjian said. One option is to move to Arco Center at 333 S. Hope St., which houses the Arco Products division, he said.

“We have a restructuring and cost-reduction initiative underway here” and Arco has determined that its headquarters costs are higher than those of competitors, Tashjian said.

Arco will soon announce details of the plan, which will include layoffs, and the company would therefore require less space. The company is considering consolidating employees but has not yet made a decision to leave Arco Tower, Tashjian said. Arco Plaza, which also is home to the Bank of America Tower, is owned by Shuwa Investments Corp., a Japanese real estate company.

Arco has already let go four senior executives, including its president, and is jettisoning its corporate jets.

Arco has slightly more than 1,500 permanent and temporary employees downtown. A total of 400 permanent and 250 temporary Arco employees work at Arco Tower, 490 permanent and 105 temporary Arco employees work at Arco Center, and an additional 190 permanent employees and 100 temporary employees work nearby.