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Whoa there silver. Just because a few tech companies are giving up their space doesn’t mean commercial office space is doomed. There are still plenty of non-t

Whoa there silver. Just because a few tech companies are giving up their space doesn’t mean commercial office space is doomed. There are still plenty of non-tech companies and local businesses (like law firms) that I doubt will be going away. Tech companies have a huge incentive here - they can now start hiring engineers at non Bay Area prices. Which, if enough companies do it, means your salaries are at risk. Nobody cares that it’s expensive to live here, they only pay because they all insisted on in person offices. By going remote they can stop paying Bay Area rents and compensation levels.

dpflan 6y ago
I agree this not a private sector overall trend, but seed for the thought experiment. Recent news and surveys do indicate significant change expected in remote work changes and real estate footprint changes. "Large companies already expect more of their workers to continue to work remotely and say they plan to reduce their real estate footprint, which will, in turn, reduce the foot traffic that feeds nearby restaurants, shops, nail salons and other businesses." [1.] This is part of data from a deport by Deloitte [2.][3.]: > "In a year, 75% of CFOs expect more of their workforce to work remotely and nearly half expect a smaller real estate footprint." [1.] https://www.nytimes.com/2020/05/21/business/economy/coronavirus-unemployment-claims.html https://www.nytimes.com/2020/05/21/business/economy/coronavi... [2.] https://www.prnewswire.com/news-releases/deloitte-cfo-signals-survey-executive-teams-are-largely-focused-on-adapting-operations-for-near-term-performance-and-evolving-their-businesses-for-a-post-crisis-future-301061671.html https://www.prnewswire.com/news-releases/deloitte-cfo-signal... [3.] https://www2.deloitte.com/us/en/pages/finance/articles/reopening-for-business-but-near-normal-operating-levels-not-expected-until-next-year.html?id=us:2pm:3em:ceocfo:awa:cons:051820 https://www2.deloitte.com/us/en/pages/finance/articles/reope... Regarding salaries due to support expensive city lifestyles: True, I would like to see how remote-first companies handle hiring people in such cities.
Apocryphon 6y ago
> Which, if enough companies do it, means your salaries are at risk. Nobody cares that it’s expensive to live here, they only pay because they all insisted on in person offices. By going remote they can stop paying Bay Area rents and compensation levels. There would be a transition period, probably on the order of years to even decades, before they would cease considering the cost of living in where their remote workers live. Hopefully by that time, rents in the Bay Area will have dipped as people slow moving in/start moving out because of flexible remote work situations.
jonny_eh 6y ago
> Just because a few tech companies are giving up their space That hasn't happened yet either. It's more like "we're going to stop expanding".
Androider 6y ago
Interestingly the law firm our company uses has converted to permanent remote only just now. So it's not just tech companies. I think, once the boss gets a taste of working from home, they too want to enjoy their fancy homes and spending times with their kids instead of sitting in traffic all day. And Covid now provides them a generally acceptable way to push that change through.

dpflan 6y ago

I agree this not a private sector overall trend, but seed for the thought experiment. Recent news and surveys do indicate significant change expected in remote work changes and real estate footprint changes. "Large companies already expect more of their workers to continue to work remotely and say they plan to reduce their real estate footprint, which will, in turn, reduce the foot traffic that feeds nearby restaurants, shops, nail salons and other businesses." [1.] This is part of data from a deport by Deloitte [2.][3.]: > "In a year, 75% of CFOs expect more of their workforce to work remotely and nearly half expect a smaller real estate footprint." [1.] https://www.nytimes.com/2020/05/21/business/economy/coronavirus-unemployment-claims.html https://www.nytimes.com/2020/05/21/business/economy/coronavi... [2.] https://www.prnewswire.com/news-releases/deloitte-cfo-signals-survey-executive-teams-are-largely-focused-on-adapting-operations-for-near-term-performance-and-evolving-their-businesses-for-a-post-crisis-future-301061671.html https://www.prnewswire.com/news-releases/deloitte-cfo-signal... [3.] https://www2.deloitte.com/us/en/pages/finance/articles/reopening-for-business-but-near-normal-operating-levels-not-expected-until-next-year.html?id=us:2pm:3em:ceocfo:awa:cons:051820 https://www2.deloitte.com/us/en/pages/finance/articles/reope... Regarding salaries due to support expensive city lifestyles: True, I would like to see how remote-first companies handle hiring people in such cities.

Apocryphon 6y ago

> Which, if enough companies do it, means your salaries are at risk. Nobody cares that it’s expensive to live here, they only pay because they all insisted on in person offices. By going remote they can stop paying Bay Area rents and compensation levels. There would be a transition period, probably on the order of years to even decades, before they would cease considering the cost of living in where their remote workers live. Hopefully by that time, rents in the Bay Area will have dipped as people slow moving in/start moving out because of flexible remote work situations.

jonny_eh 6y ago

> Just because a few tech companies are giving up their space That hasn't happened yet either. It's more like "we're going to stop expanding".

Androider 6y ago

Interestingly the law firm our company uses has converted to permanent remote only just now. So it's not just tech companies. I think, once the boss gets a taste of working from home, they too want to enjoy their fancy homes and spending times with their kids instead of sitting in traffic all day. And Covid now provides them a generally acceptable way to push that change through.