[ilyanep]

People need to stop with this whole "only commercial real estate supports working from the office" nonsense. Some of us simply want our job to provide us with a space where we can work that isn't 10 feet away from where we spend the rest of our day, the same way that our job provides us with other tools we need. Not that I'm necessarily defending forced RTO but I hate this framing of the issues.

Also if your vision of WFH is that everyone sprawls out then it doesn't solve some of your other issues: people will still need to use their vehicles to get places (because unless we solve the root issue of 'too few homes' then those people will be spread out from each other or services to not create more cities with too few homes) and their sprawled out suburban communities will not suddenly become more walkable. They'll just drive everywhere.

[labcomputer]

> Also if your vision of WFH is that everyone sprawls out then it doesn't solve some of your other issues: people will still need to use their vehicles to get places (because unless we solve the root issue of 'too few homes' then those people will be spread out from each other or services to not create more cities with too few homes) and their sprawled out suburban communities will not suddenly become more walkable. They'll just drive everywhere.

Partially disagree.

Maybe I'm not representative, but most of my family's driving is specifically _commuting_. All other weekly errands add up to less than one day of commute driving. Actually, less than one way of one day of commuting.

Unless you compare a "fully rural" drive-60-miles-to-get-groceries lifestyle to basically a "downtown manhattan" walk-to-the-office one, I'm skeptical that total car-miles will increase when transitioning from WFO to WFH.

Most "completely non-walkable" suburbs will still have a grocery store within a few miles, usually in a so-called super center with a bunch of other stores. I don't have data to back this up (other than talking with coworkers), but my sense is that people who talk about transitioning to a "rural" WFH really mean "move to a small town" or "move to the outskirts of an exurb".

So, even if they become completely car dependent, they're still reducing from 50 commuting miles per day to 2-3 "errands" miles.

[burnte]

That's fine, but we're trying to make sure going back to the office isn't a REQUIREMENT but a luxury. You go to the office, I get more done here.

[JumpCrisscross]

> we're trying to make sure going back to the office isn't a REQUIREMENT but a luxury

There are multiple equilibria. I like hybrid work. That doesn’t mean others shouldn’t be allowed to require office time. The market will work this out in tech; employees have bargaining power.

[throwbadubadu]

> people will still need to use their vehicles to get places

Hmm ... walkable neighborhood has even become more livable and walkable, all my car uses could now be public transport or car sharing.. needing one now maybe at most once or twice.per month, sometimes less.

> we solve the root issue of 'too few homes' then

Yes.. but on the other hand you can mix only so many homes around offices.. which would make my neighborhood less walkable again.

Also I neither want to be location dependent for job selection, nor do I want to move due to jobs? Kind of arrogant privileged view, on the other hand, why not just leave the space for people that actually really need to live nearby their working location, like the merchant, the doctor, etcetc?

> Some of us simply want our job to provide us with a space where we can work that isn't 10 feet away from where we spend the rest of our day

If you really have that luck to be able to live that close to your office, great.. but how long will this hold? I idiot actually moved pre-pandemic closer to the job, just that they wanted a cheaper location and reorganize and moved then farer away, lol, so I had 2 month of 10 minutes to work :) Until I get that back I prefer not to was so much time travelling for barely nothing.

[add-sub-mul-div]

It's also ridiculous because it demonstrates a lack of understanding of sunk costs. If a company with an office is that concerned about costs, it's cheaper to keep the office closed without paying for utilities and all the other overhead.

A lot of people here just want to work from home and the range of social and economic problems they work backward to have WFH solve is astounding.

[ghaff]

I don't actually believe in the whole commercial real estate conspiracy. The employers who actually have the agency here are presumably mostly not so stupid as to be making decisions based on (often relatively short-term) sunk costs.

But if those same employers are OK with employees who want to and can productively work from home, they're also justified in largely ignoring the preferences of employees who would prefer a bustling in-person office.

[adam_arthur]

Most employers don't own any real estate at all... they lease it. It's extremely uncommon for companies not directly in the business of Real Estate to own their own buildings... there's probably some single digit % of office space owned by the company occupying it.

There may be an incentive for executives tied to local real estate, though. e.g. owning a home in the Bay Area, and seeing it get devalued as everyone is moving away. Residential prices have been falling in the Bay Area... but then NYC has been pretty stable and there's still an urge for BTO there among the banks. Finance is much more relationship driven than Tech, though.

[oceanplexian]

The companies I worked for in San Francisco signed like 10 year leases for premium real estate in the city (millions per year). Before COVID it was a “sure thing” that prices would only go up, incentivizing longer and longer leases.

I suspect this is the real reason big companies are so incessant about RTO. They have to stay or breach the contract which would cost a ridiculous sum of money. Funny enough I’ve observed the exact same behavior when buying colo space or circuits in a datacenter. The previous person would sign a 10yr contact and act like we saved a ton of money, then we’d be stuck paying $10,000/mo for a 100Mb internet connection long after prices dropped an order of magnitude. Unfortunately there is no requirement for critical thinking skills to sign a contract.

[singleshot_]

It’s a little astonishing that so many companies reacted to “we made our own lives difficult by signing a contract for a thing that, it turns out, we don’t need” with “we can solve the problem by deeply annoying a lot of our employees.”

I know it’s a little more complicated than this, and I know there are jobs with Reasons to be in the office (I enjoy one) but still… now you have TWO problems.

[adam_arthur]

I have noticed this as well, companies leaning on the sunk cost fallacy to feel more comfortable throwing away the rent by having the office occupied. In the end its much better for companies if office rents fall substantially, so why fight it?

In general there tend to be conventions around lease durations, and in a hot market you don’t have much bargaining power to change the terms. The better the tenant, the more leverage you have though.

In general the risks of locking into long duration contracts needs to be weighed carefully, as we saw with SVB

[bugglebeetle]

It’s not so much about individual investments, but how commercial real estate sits as an asset class in wealthy people’s portfolios generally. There’s no scenario where a 2008 for commercial real estate doesn’t cost them a lot of money, so it’s in their material interest to push for back to office.

[function_seven]

> It’s not so much about individual investments, but how commercial real estate sits as an asset class in wealthy people’s portfolios generally.

Those same individuals also own companies that pay rent, and so also have an incentive to reduce the amount of money spent on that.

I don't think anyone in the managerial class is looking at their E-Trade asset mix, and deciding that they should change company policy to protect their investments. One decision at one company isn't going to move the needle one iota. And even if it did, it would move another needle the other way (companies are tenants, not landlords).

Much easier to sell the real estate and purchase more shares in companies that were once tenants.

[bugglebeetle]

To whom would they sell this real estate in a tanking, high-interest rate market, exactly?

[JumpCrisscross]

> whom would they sell this real estate in a tanking, high-interest rate market, exactly

Anyone with the political connections to get a residential conversion approved. The wealthy elite are uniquely positioned to profit from this in a civically inactive and politically insular city like San Francisco.

[bugglebeetle]

Residential conversions are wildly expensive and frequently infeasible, so even assuming you have the political connections, the financing is going to be a challenge, and of course your end goal is to fill them with tenants in a down market for tech jobs.

Congratulations, you’re basically back to square one of filling empty real estate, now at additional cost. And thus why the incentives are to try and ride out the status quo by forcing people back into offices.

[ghaff]

That's sufficiently indirect and diffuse that I don't really believe it. That's a bit like Amazon is a non-trivial part of my stock portfolio even through index funds so I'm going to make us go all-in on AWS for that reason (as opposed to other herd-following reasons that may be good or bad).

Especially among execs who have so much wealth that commercial real estate holdings, much less the ones they can directly influence, are in the noise.

[bugglebeetle]

An individual investor has nowhere near as much sway over masses of other people as the business owners we’re describing here, so this analogy doesn’t hold. If you could invest in Amazon while simultaneously forcing others to spend millions on their services, you probably would!