This is the real reason for companies wanting people back to the office.
All this talk about collaboration and team spirit is just the publicly given reason for wanting people back to the office.
The real reason is that now the owners of the buildings are losing money.
Cry me a river.
Yep, been saying this for years now, the vicious and irrational hatred against work from home employees is driven by two main factors:
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At a systemic level, despite work from home being obviously less costly in the long run than maintaining an office space, if work from home were allowed to proliferate it basically pop the commercial real estate bubble and then basically every corrupt mayor and idiots in upper management would be shown to be corrupt idiots.
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At a more personal level, upper and middle management people essentially get their kicks from seeing busy little worker bees near them, and they would personally have existential crisis when they realize that 90% of what they do is negging and then ommitting or misrepresenting that in actual meetings. Actual meetings which can easily take place in zoom, or often replaced with just an email.
And you can’t sleep with employees who work from home.
I count my wife as my secretary every now and then, does that count? ( ͡° ͜ʖ ͡°)
She’s already signed an agreement that supersedes HR policy on the pen in company ink: A marriage license
Except family business in alabama
Another part of #2 is they can no longer be toxic and verbally abusive, like they could in person. Anything virtual might be recorded and every email is a record.
Thats a key element as well, the insane corpo manipulation that only exists if you can prove it even though everyone who doesnt up their head up either their own ass or someone elses knows is absurdly rampant… but youre too busy to record it all!
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It’s sad that problems for banks are never problems only for banks. They always turn into problems for everybody else
lol I wrote this over a year ago
If they can’t afford to lose money, they should stop being poor.
Skill issue
It’s really not that hard.
They should stop buying avocado toast and make their coffee at home!
They should sell the buildings…
But nobody wants those buildings.
They do, just not at the prices they want to sell them at.
So, I’ve thought about it and we have a housing shortage and an excess of offices. Seems like a solid solution. Takes a lot of work to make an office into a home, but it’s more profitable than leaving them empty.
But no, that would help people, and the cruelty is the point.
Yep, Ive been saying this for years now as well.
We have giant mostly empty office buildings which could be converted into mostly apartments, with even make shift permitted commercial zones for basically street vendor / convention booth style shops every 10 floors.
Instead it apparently makes more sense to not do this because it makes more sense to keep them empty, heated and lit 24/7, as basically a way to prop up the retail property market.
Capitalism is a farce, and it has already doomed us all: we have now breached the 1.5 C warming barrier, even more rapidly than most of the worst case scenarios predicted. Permafrost in Siberia and Northern Canada is already thawing and releasing methane.
Enjoy the collapse of human civilization in your own lifetime as people and governments continue to squabble and combat each other over scarcer and scarcer resources as our entire way of life becomes too expensive to maintain.
Converting offices is expensive and complicated. Zoning laws also makes it even harder.
This is true, there are hurdles and there people actively working to overcome them and succeeding.
Would you like to know more? https://duckduckgo.com/?q=office+to+residential
I’m aware
It’s a solid solution only if someone ponies up the money to pay for the incredible effort it takes to convert an office building into residences. Waving your hands in the air and telling someone else to pay for it is not a good argument.
Are you watching me? How did you know I was waving my hands in the air?
Meanwhile my company wants to double or even triple the amount of office space we lease in the next 2-3 years, but building management is quoting us prices that are even slightly higher than they were in 2020.
Kinda sounds like the board of your company is full of real estate developers who still win if you guys go tits up.
Prices only go up. If a price is allowed to fall then the gravy train stops and the owner class gets really salty.
This is simply sunk cost fallacy. Companies signed leases. Now they regret it but can’t back out so they’ve got to try to pretend it’s worth it even if it costs their employees money out of pocket.
It’s not really about owners it’s more about leases and the company leasing the property “not getting their money’s worth”
Often they have signed leases with themselves. With original owners, holding companies etc.
This is a way of extracting value from a corporation without paying it as a dividend or salary. Dividends go to all shareholders. Lease payments go to one specific one.
So obviously if there’s no reason to pay these leases anymore, somebody powerful is going to be very upset.
Oh no.
Anyway.
If only there was some solution to unused corporate office space and the housing crisis that has tents in every city?!?
Oh well. Better give the bank a bailout and stop thinking about it.
Wait…are you suggesting we solve a problem? Or even two problems simultaneously? That’s absurd! We need tax cuts, deregulation, and corporate bailouts…I may not know the problem, but I know the solution. /s
That doesn’t make sense. The companies that want people to come back to the office are the ones paying rent. That rent doesn’t get better or worse if people come back to the office.
These companies tend to own or have long term leases, so either they are stuck paying rent and have to justify the expense or they own an asset that is depreciating in value and they could stop that from happening by spending no money to force their employees back into the office. You have to think about the big money, too. Real estate is a cornerstone asset for big money, many banks and real estate empires hold these enormous office buildings and society trending towards WFH means those buildings are rapidly losing their value.
Justifying the rental expense doesn’t really make sense, because they end up paying more in utilities in addition to the rent. If you’re still on the hook for a lease and have most employees WFH, just downsize when the lease ends or move everything remote if possible.
Seems like banks are worried about the loan holders defaulting and are pushing companies to bring employees back to bring up demand for commercial real estate?
these leases are like 10 to 30 years, its not like a yearly one.
I’m aware, but that doesn’t negate my point. The tenant company still has to pay more in utilities and such to bring people back to the office. Whether they pay that cost for 10, 20, however many years is extraneous.
A lot of larger citys will also have things on the books (not sure if it will effect commercial zoned buildings) but if they are empty they will be charged much higher tax rates. And also if you turn on the lights in a place its normally the whole area is turned on. So if they get 3 people to come in they are spending the same power that a full office would need (assuming they have workstations there) if not then they need to wait till the contract they have allows for some sort not full payout with other penalties (which when you see a biz go under the lease holder will be part of the creditors that get money well before employees).
Why would anybody get into an unbreakable office lease of 10 years? Let alone 30.
You have never leased out a office building I can see. If you area going to spend 100,000’s even into more to make the office space (as you build to suit inside the space as well) you wanna know you have it for so long. So it was good for biz as they knew they would have it for a decade maybe more and protect the investment. And it would also lock in the rent rates for that time so they could stave off inflating rents (there is a normally a year over year % increases built into the lease so the company that owns the building doesnt loose out too bad).
It was also something that C levels were spending their money on, they would own the property company and get even more out of it. They could spend a ton with a bank with the thought of I can assure you biz X (which they are on the board of if not the CEO outright) will be there for this many years and will pay the principal of the loan over this time, we also built space for other offices inside the building and we will give a discount to anyone that used or is referred by your bank. Again stacking security onto the loan they got, plus more to put on a plate of a potential biz start up.
Yes, thank you! I hate this constant narrative that back-to-office is always tied to commercial real-estate investments, or that there’s some magical tax incentive.
Usually what you have is: bank lends money to a commercial real estate company that owns the building. Commercial real estate company leases out office space to one or many companies. When those companies reduce or terminate their leases, the commercial real estate company struggles to pay their mortgage and defaults. Commercial real estate loses. Bank loses. And if commercial real estate had pooled investments to fund the building (along with bank loan), then those investors lose as well.
There are some large companies that own their own buildings, but that’s more of an exception.
But those rent paying companies have very wealthy boards who are invested in commercial real estate.
And the companies are controlled by venture capitalists, who are smart and distribute their investments. So they have interests in various companies, including the real estate companies.
Oh won’t somebody think of the shareholders.
Oh wait, I’m doing it right now. Mua ha ha ha ha ha ha!
This is a good post, but I’m not sure it belongs in technology. Hmm.
The connection is mostly that tech companies have been wanting people back to offices for years now, so it kind of made sense to place this also in tech. But I know what you mean.
I just hope something can be done with the empty structures. Turning them into housing is easier said than done for many buildings.
It’s easier said than done, but it’s not that difficult. It’s mostly reconfiguration of plumbing and zone controls on HVAC. The electrical is easier to distribute.
If you commit to doing it the right way, and tear it down to the structure (but leave the facade alone), it’s not terribly difficult.
The problem is that the building owners want to do it cheap, and it won’t be cheap. It will be more economical in the long run than fully vacant building though.
Iirc one of the biggest challenges was plumbing right? Especially for tall buildings.
So more or less, since many businesses are only keeping their offices because they have multi-year leases preventing them from simply packing up and going fully remote or downsizing to a smaller office, we can expect occupancy rates to continue falling and slow-burn exacerbating the commercial real estate crisis. And really, the problem here is just that banks are overinvested in commercial real estate, not knowing that a pandemic would alter work patterns in a lasting way. So again, we’re all in for a fun ride on the roller coaster that is capitalism, literally because of problems caused by real estate speculation.
Because banks fucked up and we have to solve it
Damn, squatting on real estate is backfiring. I’m heartbroken
I will never have sympathy for landlords.
Easiest ‘job’ on the planet.
