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why can’t they sell the buildings/get out of the leases/let them expire/don’t renew them/lease them out to somebody else?
by MuffinFlavored 4y ago
why can’t they sell the buildings/get out of the leases/let them expire/don’t renew them/lease them out to somebody else?
- mike_d 4y agoYou have a bucket of widgets, and so does everyone else to varying degrees. Each widget is really worth a dollar, but you paid $12 on average for yours because widgets were in demand at the time. Nobody really needs all their widgets right now, so there is little to no demand. You can either keep holding your widgets and keep them at a $12 valuation on your books, or sell them for an $11 write down. If enough people sell their widgets at $1 then everyone's widgets are magically worth $1 too, and everyone is fucked. Bay Area commercial real estate right now is like holding a bunch of jumbo mortgages in 2007.
- indymike 4y agoVery few buyers for large amounts of office space right now. Commercial vacancy is high.
- WhyNotHugo 4y agoThey're trying to push for this "back to the office" mentality. You can't convince other that this is a good idea and then lease out your offices if you're not using your office yourself. I'm not sure about this particular case, but in similar situations with other corporations, a key detail was that management had investments in office real estate, so the push to "back to the office" was more about personal pockets than anything else.