Every CFO or CEO Ive talked to thinks remote work is wildly unproductive. They do occasionally check internal messaging networks for green lights and get pissed every time they see 80% off. (Kind of like Bloomberg dot colors). Most would prefer hybrid at most 2 days offsite in a week.MDlaxfan76 wrote: ↑Thu Aug 24, 2023 10:58 amVery serious issue with office real estate. Not worried so much for financial services nor Schwab in particular.youthathletics wrote: ↑Thu Aug 24, 2023 8:09 am Charles Schwab Plans To Cut Staff, Reduce Real Estate Footprint In Latest Cost-Cutting Push
https://www.bisnow.com/national/news/of ... int-120348
But big, big problem for office real estate, especially in over built regions, but throughout the country.
Huge vacancy rates persist post Covid, especially in urban cores....and that has all sorts of negative ripple effects. Falling rental rates are understated as leases for subtenancies are significantly less than master. So, when leases turnover, tenants are taking the opportunity to downsize and then paying much lower rates per foot as well.
I think that this is going to be a persistent issue as white collar work expectations continue to change and companies look for ways to rightsize in-office and be more productive with their resources overall. Technology has had, and will continue to have, a big impact on number and necessary location of workers. And we're going to see this continue as various forms of AI make a good worker far more productive, accomplishing 1.5X, 2X, 10X what they could have done before...there will be competition based on these dynamics...
Want to see where things are truly out of whack disastrously? China. Largest real estate company (one of largest in world) went bankrupt. 2nd largest close to doing so as well...
That being said (webinar by Trepp next week on office): https://www.trepp.com/market-pulse-webi ... e=hs_email
A report on office from end of July
https://www.trepp.com/access-trepp-offi ... 6f0c4fcec0