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With lots of companies struggling or going under, the demand for commercial real estate should be lower. Supply roughly constant, demand significantly down.
by martincmartin 7y ago
With lots of companies struggling or going under, the demand for commercial real estate should be lower. Supply roughly constant, demand significantly down.
- wyldfire 7y agoI would think/expect that long term demand for the services provided would continue to exist/grow, so probably just short term commercial real estate impact?
- short_sells_poo 7y agoProbably, but the key issue is how levered WeWork is. It's the same really as taking out a mortgage you can barely pay. It only takes a short term shock to push you into default, and once foreclosed, it doesn't matter that you'll eventually recover because the losses will be locked in and you no longer participate in the recovery.
- lkbm 7y agoCompanies might also realize that now that they've figured out how to work remote, they should keep doing that and save ten grand or so a month. I believe the smallest offices in the WeWork we're housed in are $6k/mo. Those are generally used by teams of 3-6 people.
- wool_gather 7y agoEmployees are not universally going to just eat the costs of working from home (or from shared spaces) on behalf of their employers, though. If this becomes a more regular situation, employer subsidies for remote essentials will be expected features of jobs even more than they are now, i.e., not just perks. The monthly bills for 100 remote workers is easily 10K -- their internet connections alone would probably hit that. A single person renting a desk at a co-working space is going to spend a few hundred a year.
- londons_explore 7y agoI see employers just requiring you to have a workspace at home. > Your crappy internet keeps cutting out? Not our problem. Poor work performance. You're fired.
- wool_gather 7y agoWould an employer with that kind of attitude even be trusting enough to let people to work from home in the first place?
- blaser-waffle 7y agoAbsolutely. Easy way to shift blame and then trim the fat.
- asdff 7y agoSame thing happens today if you are a wage worker and your car breaks down and miss a shift with an unsympathetic boss.
- lkbm 7y agoRight, but the monthly bill for 100 non-remote workers at WeWork is 5-10 times that just for the space. As I said, their smallest offices (~6 person -- maybe 10 if you really crowd) are $6k/mo.