Trading floors have always been the beating heart of major banks. Hundreds of people hunched over computers, gossiping, yelling and chatting on the telephone, and most importantly, generating revenue to their employers, were the trading floors.
Before the pandemic, a typical New York City office floor might have housed 150 to 200 people. A typical trading floor at a major financial institution could have accommodated 400 to 600 people. Each person used multiple monitors, a desktop computer, and a specialized telephone system called the turret which can process hundreds upon simultaneous calls. Many trading floors had their own data centers to provide on-site backup. However, these have been lost with the advent of cloud backup services.
Trading floors are unique due to the high density of people and electronic devices. They also require more ventilation than an average office. An underfloor ventilation system is necessary to cool the room effectively because of the heat from so many people, computers, and screens. Trading floors have ceilings that are at least 15 to 20ft high. This makes it less efficient to cool the room from above than from below.
Architects, engineers, landlords and others argue that trading floors use more energy than regular corporate offices for all these reasons. These bustling financial hubs pose a problem for landlords who must reduce their energy consumption in order to comply with New York City’s Green Buildings Law, Local Law 97. In 2024, buildings with more than 25,000 sq. feet will be subject to significant fines if they fail to meet the energy benchmarks. These laws are designed to reduce carbon emissions.
Financial firms have also been forced to digitize their trading due to the pandemic. Most banks have moved to cloud-based platforms for their trading operations. These virtual desktops allow analysts and traders to use Bloomberg Terminals from home. A thin client terminal is a stripped-down computer that connects with a remote server. This allows traders to access their virtual desktops from anywhere. Digital turrets is an online version for the telephone switching system that traders use at work. It allows traders to handle higher volumes of calls while working remotely.
This means that traders can work more efficiently with less energy. Many trading floors are moving away from desktop PCs and favor thin client terminals that use less electricity. A trading floor with fewer servers and computers requires less energy to cool.
Despite having a smaller carbon footprint than 10 years ago, many trading floors still require more power than a law practice, a nonprofit or an architecture studio.
Ece Calguner Erzan is a SOM design principal who has worked on many trading floor projects in New York City. He said that a trading floor uses more energy than an office floor. Trading floors can have 400, 500, or 600 people, depending on whether they are new or existing. Your energy loads will be much higher when you have so many people on one floor. It’s about how much energy is required to cool 400-500 CPUs. [central processing units].
She said that trading has seen dramatic changes over the past five- to ten year due to technological advancements. The cloud has eliminated the need for data centers. Everything is out of buildings. Or, there is a New Jersey Data Center so we don’t have to cool them. If you don’t have a CPU on your desk you can reduce the heat. It allows traders to be flexible and mobile.
John Pickens, Erzans SOM associate principal, who handles technical aspects of trading floor design, said that trading still has a higher electrical load despite all the technological advances. There has been some outcry over trading floors versus standard offices. Local Law 97 doesn’t distinguish between a legal firm and a trading room. It categorizes it all as office space.
Lighting is another important factor in energy consumption. The use of sensors to dim lights at night and turn them off during the day can reduce electrical loads in all types offices, including trading floor offices. Pickens pointed out that sensors are now available that allow landlords and tenants to turn off computers and other electronic devices after someone leaves their desk. Some desks have built-in timers to put computers to sleep.
Migrating to thin client terminals from desktop computers can still be one of the greatest energy savers. There may still exist trading operations in the area that are still using local CPUs at desks. These businesses will need to make investments in moving. [computing]Pickens said Pickens was able to speak for the outside city, even though there is no Local Law 97.
Marisol DeRosa, an architect with Genslers financial service practice, said that standardizing traders screen setups is another way to reduce electricity use. She also worked on Deutsche Banks new Columbus Circle headquarters.
She explained that every trader has their own preference regarding screens. Some traders prefer to have four to six standard monitors that look like a cockpit. Others prefer three long, curved screens that are arranged in a straight line. DeRosa explained that Deutsche Banks trading floors in 1 Columbus Circle have a standardization for the screens so that every trader has exactly the same number of monitors and type.
Some traders have not yet switched to virtual desktops even though Deutsche Banks new trading floor was opened.
Because they were not fully migrated [to thin client]She said that we have included this flexibility in our desk setups. One for traders who have already migrated to cloud computing, and one for traders who are still in the cloud.
Owners feel Local Law 97 will unfairly penalize their buildings because they have large financial tenants.
One Bryant Park’s landlord, the Durst Organization, faces potential fines of millions of dollars. This despite installing environmentally-friendly features such as a cogeneration plant and geothermal heating. The buildings anchor tenant Bank of America has trading floors located on the second through sixth levels of the 2.1-million-square-foot office tower.
Jordan Barowitz (a Durst spokesperson) stated that there’s no way to limit these uses in a way that doesn’t use more carbon. Although we could have fewer people in the building, they would still be using more carbon and working in a less efficient environment. Our cogeneration plant is twice as efficient than regular power plants and could be unplugged and plugged into the grid to heat our building. However, the grid isn’t powered by renewable energy so we would be burning more carbon.
Durst feels like it is being punished for its ownership of a densely populated office tower, a feeling that other owners may share. Industry working groups are helping the city’s Department of Buildings to develop more detailed Local Law 97 rules that could adjust energy standards for different types of tenants. Even a discussion has been held about mitigating penalties for dense office buildings. Barowitz countered that it wouldn’t be enough.
The working groups are trying that, but they are constrained because of the law’s language. The law is very specific, so you need to be very creative in order to navigate around it. There isn’t a lot of flexibility.
Pete Sikora, climate and inequality campaign director at New York Communities for Change is skeptical of owner claims.
He said that he would like to hear a detailed, well-thought-out analysis by the industry of different types of buildings with and without trading floor. This is a serious problem, but there has yet to be any evidence.
He also said that landlords could do more basic energy upgrades.
They need to make energy efficiency improvements in the near term, according to the activist. Their exterior lights are always on during the day. They are not LEDs so they will retrofit them.
He said that One Bryant Park, a building, can apply for waivers under Local Law 97 benchmarks. To offset some of their carbon footprint, owners will be able to purchase renewable energy credit (RECs). The first offshore wind projects and the hydroelectric lines that will power New York City’s electric grid are expected online in 2025-2026. This would allow for the creation of a carbon credit program. However, the state and the city have not yet published pricing and rules for RECs. This leaves landlords unsure about how much they will be able buy.
Sikora also believed that the DOBs rulemaking would make law enforcement more fair.
Sikora stated that the Department of Buildings is currently working on a finer categorization of different building types. It will map the limits to give a better idea of what is fair for any building.
Density adjustments could also be in the pipeline. While office owners are aware of how many people enter their buildings each day, other types of landlords don’t necessarily use this technology.
Sikora stated that a system to account low and high density buildings can make the law more fair. It’s very difficult. How do you track it and compare it? Is it possible to count people as they enter and exit the building? It’s not practical for the vast majority real estate. The Department was encouraged in this way [of Buildings]It is important to remember that density tracking must be practical, easy to use, and not too complicated. It is possible to make it less valuable that its compliance. If you want to adjust density, it must go both ways and produce the same level pollution cuts.
Rebecca Baird-Remba can be reached at [email protected].