The world’s empty office buildings have become a debt time bomb

The bellwether we have for the health of the UK, or at least London, is train and tube usage. It has, apparently, returned to almost 100% of pre-COVID.

That's not to say that London's commercial properties are fully reoccupied, they're not, but London is perhaps doing slightly better than US cities in this regard.

Having said that - HSBC is moving from Canary Wharf back to a smaller building in the City (of London) because of the change to WFH: https://www.bbc.co.uk/news/uk-england-66019180

This sounds like a horrible vision for the future -- everyone completely separated, all interactions via video chat? All in the name of making sure we never have to leave our homes for convenience's sake?

A car is a machine to provide negotiating leverage in real estate markets.

Dense urban centers, while awesome in many ways, easily lend themselves to the development of grassroots real estate cartels made up of property owners who block new construction to profit from real estate appreciation. As this occurs people are forced further and further out to find affordable places to live. Eventually the jobs start to follow, leading to tax base collapse and urban decay. This leads to a death spiral of urban decay, crime, and population flight.

Then the city gets cheap and people start to move in again. Repeat cycle. Cities get cool -> people move in -> cities get expensive because you can't build -> people move out -> cities collapse.

There are places that seem able to avoid this cycle, such as Tokyo, but AFAIK that relies on a different kind of governance regime that takes zoning away from local bodies and enforces a uniform pro-density zoning code at the city or even larger scale. Basically you have to break the NIMBY cartel. It also involves very proactive transit policies that build out transit to match density.

Of course it could also be due in part to Japan's declining population, which makes it pretty hard to have real estate inflation.

I put it to you that while you have taken one step back, you will get a clearer view if you take 10 paces back.

We are in the midst of catastrophic accelerating climate change. We are heading for a world that is 3-4º C warmer by the end of the 21st century, when children born today are getting to old age. That means the certain collapse of the West Antarctic Ice Sheet and worldwide sea level rise of 5-6 metres in those kids' lifetimes.

Now look at how much of these expensive cities and their expensive offices are build under 5-6m of current high tide level. All those buildings will be lost to the sea before they are paid off. All those investors will lose their money. All cities and city districts wholly located within 5-6m of mean sea level will disappear completely.

Just considering sea level rise, whole nation states will disappear. Whole economic sectors will collapse.

But it's not just about sea level rise. With 3-4º of warming, much of the tropics becomes uninhabitable. Most glaciers disappear; currently fertile countries lose their year-round water supply.

The Himalays are called the world's 3rd pole. 5 or 6 major rivers originating in the glaciers of the Himalayas provide about one third of all humanity with their fresh water.

All those countries become desert, even if only seasonal desert. All agriculture fails.

If you view the world in terms of money -- not a good strong robust worldview at all, but a common one -- then there are far far bigger financial threats looming than empty offices and bankrupt financial institutions that invested in them.