David King, the agency's regional CEO, confirmed the news to Campaign.
"We will be scaling down our Beijing office, which will see the relocation of several staff to Shanghai, further up-weighting the resources of this growing office," he said.
Among those who will move to Shanghai is Barry Low, creative director for China, who left DDB and joined Iris in August.
For those unable to relocate, King said the agency is "working very hard" to find opportunities at other agencies for them.
Sony Ericsson, a major client in Beijing, will also be handed over to the Shanghai office.
The announcement has been made internally, but King said it might take a couple of months before the process is completed.
In Shanghai, King said he still saw multiple opportunities for Iris. "There are a number of pitches going on. And we have existing business. A number of potential clients. A number of international clients that we don't yet work with in China," he said.
"Iris Shanghai will therefore become our regional hub for best practice, resource and creativity in China," he added.
As part of the agency's ambitious plans of expansion in Asia-Pacific, Iris Beijing and Shanghai were launched in March 2009 and January 2010 respectively, following the establishment of offices in Singapore, Delhi, and Sydney.
Timeline of Iris' China operations
March 2009 Iris opened an office in Beijing headed up by Peony Wu, formerly Asia-Pacific marketing director for Motorola.
July 2009 Peony Wu left Iris and joined Ogilvy's digital and direct media unit, Neo@Ogilvy, as managing director in Greater China.
December 2009 David King, formerly managing director of Rapp China, joined Iris as regional CEO of China. King oversees the agency's client base - in particular the Sony Ericsson business across Greater China. Meanwhile, board director Chris Martell, who has been running the Sony Ericsson business in Asia for the past 18 months, relocated from Singapore to Beijing to lead the business.
January 2010 Iris expanded to Shanghai. "China is one of the fastest growing communications markets in the world and a presence in Shanghai has always been planned to service our regional and global clients," said David King in a statement.
May 2010 Lester Kahn was appointed managing director to lead the growth of Iris Beijing.
August 2010 Barry Low, formerly senior creative director at DDB China, was appointed creative director for China.