3 ms·

I would agree with you that overall demand is likely to shift towards short-term flexible office space and away from long term leases, I just don't understand w

I would agree with you that overall demand is likely to shift towards short-term flexible office space and away from long term leases, I just don't understand why large real estate holders will leave that piece of the pie there for third parties to arbitrage, unless they're genuinely desperate, and I don't think they'll become that genuinely desperate because the government will act to shore them up because of how critical central business district real estate values are in general to so many things. I see large real estate holders spinning up WW-like departments and following the WW model but I don't see a company that doesn't itself _own_ the real estate being able to prosper. WW managed to cultivate a very trendy atmosphere and all the associated types piled in accordingly but that only lasts for a while; sooner or later you run out of cash to burn. I have no idea why SoftBank threw money at WW like they thought they had to spend it all before the world ended, I'm not sure that they really know either.

vidarh 3y ago
They've had many opportunities to do that over the years, and instead left the space to stodgy providers like Regus. Some might try to address it now, others will just unload their assets or look to partner with someone to do it for them. It's not a given they'll want to be the ones taking the risk - ironically with WeWork likely to be one of the things making some of them wary of starting their own. Better to let someone else burn other shareholders money if it doesn't work. But ultimately, irrespective of political clout, there's only so long you can shore up a glut in supply before there will be a push towards e.g. residential conversions and the like. I agree with your skepticism with respect to WW's ability to be the one to profit, though.

3 ms·

I would agree with you that overall demand is likely to shift towards short-term flexible office space and away from long term leases, I just don't understand w

by 15457345234 3y ago

vidarh 3y ago
They've had many opportunities to do that over the years, and instead left the space to stodgy providers like Regus. Some might try to address it now, others will just unload their assets or look to partner with someone to do it for them. It's not a given they'll want to be the ones taking the risk - ironically with WeWork likely to be one of the things making some of them wary of starting their own. Better to let someone else burn other shareholders money if it doesn't work. But ultimately, irrespective of political clout, there's only so long you can shore up a glut in supply before there will be a push towards e.g. residential conversions and the like. I agree with your skepticism with respect to WW's ability to be the one to profit, though.