[jjav]

> corporate executives are the kind of people who could have a lot of money invested in commercial real estate

Sure, many of them do.

But there's something else they are far more invested in: their company (through huge pay and even larger stock option grants).

I don't buy this meme that CxOs are willing to hurt company efficiency just to protect personal real estate investments, when for nearly all executive (I'm sure there's some exception but not enough to matter) they own far more share in the company than in their side business in real estate.

[johnnyanmac]

>I don't buy this meme that CxOs are willing to hurt company efficiency just to protect personal real estate investments

I do. Think of all the inefficiencies you've seen reported (or reported yourself) and nothing is done. On the grand scale companies have abandoned the idea of retaining talent altogether, with best performers leaving over the refusal for some 10% CoL raise and hiring/training a new person for 20% more.

I think the most dangerous part is that these aren't rational actors fully focused on maximizing long term profits. So they aren't making seemingly rational decisions.

As an alternative viewpoint, there are probably a lot of peer pressure from people we never see nor hear about that can influence these CxO's as well. They are still people at the end of the day (85% of the time or so). if their friends or [company they admire] do something they will follow suit, no matter how incompatible it is with their company.

[l33tman]

I asked the CTO/R&D manager at a company I worked for once why he didn't bother getting talent or retaining talent, he said (paraphrasing): "Because I can't scale talent I might as well don't bother with it"

Many large corps are fine with being on the thick part of the Bell curve, their managers can easily scale if the board says they should output more, they are essentially linearizing their whole company around a point and they can scale up/down around it.

It works until someone else innovates and beats them, and then the loop repeats.

It's in some sense good that CxO's behave like this, because it leaves opportunities for smaller companies all the time.

[jncfhnb]

Agreed. But, companies are owned primarily by funds that in turn are exposed. If there is some pressuring to save real estate, it’s not the C suite, it’s the stockholding giants

[mitthrowaway2]

I think this doesn't get enough attention. The biggest shareholders in many companies are index funds like Vanguard and BlackRock, which often have the right to vote on behalf of the shares in their ETFs. Their interests are in ensuring the entire ETF goes up, and a real estate deleveraging would do the opposite.

[phkahler]

>> Their interests are in ensuring the entire ETF goes up...

Things like automatic enrolment in 401K plans, or automatically bumping employee contributions by 1 percent will also benefit the broad market and funds.

[mitthrowaway2]

Yes, as does curing COVID and protecting the environment.[1] And on the less good side: broad-based price hikes instead of fighting with the competition over market share in a race to the bottom.[2] It remains to be seen whether ETF ownership is connected to "greedflation", but I believe so.

[1] https://newsletterhunt.com/emails/12216

[2] https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2632024

[krageon]

You shouldn't assume this much competence of anyone, including anyone in upper management. This is a fallacy both you and the GP make, though it is a bit easier to believe that they think their company suffers because people work from home. It is a fairly incompetent attitude, with very little if any basis in real data.