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Landlords are trying not to rent to startups in San Francisco

42floors.com

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Re: Landlords are trying not to rent to startups in San Francisco

#131

Post by Turing_Machine »

Johnny555 wrote: post #113
timtadh wrote: post #107

Earlier quoted context omitted.

I have found that this says more about the ability of the management and less about the ideas underpinning remote work. Large companies figured out some time ago that they could have a large remote workforce. So it isn't just Basecamp or whoever that is doing remote work. Remote work has it challenges but (and here is the important point) they can be managed if the team knows how to manage. FOSS proved over two decad…

Google, a very large company with nearly unlimited technical resources, continues to bus workers 40 miles down the peninsula every day because they want workers to stay on-site. Google, of all companies, could afford as much office space in SF as they need, yet they still choose to only have a relatively small satellite office there. The experience of large companies that have large remote workforces and FOSS project…

Hmm... it could be argued that Google's repeated failures in the social networking space are compelling evidence that it's one of the least likely companies to succeed with remote workers.

Re: Landlords are trying not to rent to startups in San Francisco

#132

Post by _delirium »

lkrubner wrote: post #59

There are already several comments on this Hacker News thread where people suggest things like remote work. Others suggest moving to less expensive cities. Someone mentioned Tennessee. "mooreds" made the suggestion "consider starting a company outside of San Francisco". But such comments ignore (are in denial? are in defiance?) what is actually happening, which is described in the 3rd sentence of the linked article:…

> It's worth noting that what we are looking at now is some re-centralization.

I think there are some local re-centralization trends, but it doesn't really show up in the overall numbers. Most of the fastest-growing areas in the U.S. are suburban, e.g. the Dallas suburbs are growing far faster than SF is.

Fivethirtyeight had a piece on this focusing on millennials: http://fivethirtyeight.com/datalab/think-millennials-prefer-...

Re: Landlords are trying not to rent to startups in San Francisco

#133

Post by Turing_Machine »

mschuster91 wrote: post #114
Crito wrote: post #75

Earlier quoted context omitted.

Although astazangasta is complaining about rent, he doesn't actually want to buy land either. He thinks he is entitled to free land.

Native Americans iirc thrived without the concept of "privatized land" for thousands of years. Same for basically other self-sustaining native population in history. Okay, you got the occasional clashes with other clans for land but hey, you could always move somewhere else. That's impossible now, given the massive numbers of humans on this planet.

Sorry, that is not correct.

http://tarlton.law.utexas.edu/exhibits/aztec/aztec_property....

I doubt there's ever been an urban culture that didn't have some concept of property ownership, whether by individuals, "nobles", or the state.

Re: Landlords are trying not to rent to startups in San Francisco

#134

Post by czbond »

Osiris wrote: post #64
mooreds wrote: post #7

Or, consider starting a company outside of San Francisco. Not just outside of SoMA, actually outside of San Francisco. (I know, I know, blasphemy.) Eventually the price of real estate and labor will be so high that the relative disadvantages of other locations will not matter.

ZenPayroll is opening a Denver, CO office, looking to hire 100 people[1]. [1] http://fortune.com/2015/07/28/zenpayroll-jobs-denver-colorad...

Boulder is an incredibly difficult market to hire in. I was talkign to the head of Google Boulder when he mentioned they can't even get engineers hired there.

Re: Landlords are trying not to rent to startups in San Francisco

#135

Post by davemel37 »

Honestly, if 42floors just discovered this...they should never have gotten into the commercial real estate business.

Real Estate 101 is about leverage and the cost to borrow is directly impacted by the tenant mix and their respective credit ratings.

How do you operate in the real estate leasing game for years without knowing what landlords want?!

Re: Landlords are trying not to rent to startups in San Francisco

#136

Post by kevin_thibedeau »

jerrac wrote: post #123
mooreds wrote: post #7

Or, consider starting a company outside of San Francisco. Not just outside of SoMA, actually outside of San Francisco. (I know, I know, blasphemy.) Eventually the price of real estate and labor will be so high that the relative disadvantages of other locations will not matter.

I wish people would do that. I know when I see jobs that interest me, they're almost always in SF or NYC. Neither location is somewhere I'd flourish. Seriously, what is the actual appeal of SF? I just don't see it.

The train system around NYC makes it practical to live in more idyllic locales than the heart of the concrete jungle. There are plenty of quaint towns built around LIRR and NJ Transit stations.

Re: Landlords are trying not to rent to startups in San Francisco

#137

Post by fredkbloggs »

khuey wrote: post #125
rconti wrote: post #111

Earlier quoted context omitted.

Not to pile on too much, but the Fed has been amazingly slow to raise rates and only shows signs of doing the most timid increase. It's the cheap money that's fueling the mad rush, yes, but it's a blunt policy tool being used to help along parts of the country that are really still struggling. Until Detroit and Stockton and Pittsburgh are doing well again, aggressive policy is going to continue to fuel massive growth…

What happens if those areas simply don't start doing well again? Large parts of America have been declining for generations (West Virginia, much of Ohio, etc)

Which is likely. Echoes of the eurozone here for sure; SF probably needs 8% interest rates but even 0% is doing very little for the Rust Belt and other perennially depressed regions. Now, the eurozone critics think the problem is lack of fiscal union, but the US suggests it goes a lot deeper than that.

Re: Landlords are trying not to rent to startups in San Francisco

#138

Post by fredkbloggs »

_delirium wrote: post #117
fredkbloggs wrote: post #67

Earlier quoted context omitted.

I'd turn that on its head: keeping short rates as low as they are requires extraordinary economic weakness. The only bad time to raise rates away from zero is when a total collapse is ongoing. None of the recent economic data suggests that a collapse is ongoing; quite the opposite. You're right that it's bad timing in that their rate increase is likely to come shortly before a bust, and therefore will be second-guess…

They would need a new approach to monetary policy to really have justified raising rates in 2013, because there was neither inflation nor full employment, the two things the traditional Taylor rule watches. Inflation was stuck around 0.1-0.2% for all of 2013 (below target), while unemployment was around 7-8% (above target). If the SF Bay Area had its own monetary policy, things look a lot different in the local stati…

Part of the problem is that the CPI-U (and the PCE chain deflator) indicators they use don't do a very good job of capturing the cost of living for anyone. Cue rant on hedonics, basket problems, etc.

In the 70s the big focus was on the wage-price spiral, so hourly wages and prices paid were important indicators. Today there is zero wage inflation going on despite near-full employment, and instead asset prices are in an upward spiral. The preferred indicators should have changed to reflect reality but they haven't. That reality is that outside of a bubble sector there may not be wage growth during the lifetime of anyone now living. When the unions ruled the roost and labor's share of revenue was sky-high, a focus on wages was appropriate. Today, unions are almost gone, wage growth is nonexistent, and virtually all money being created is flowing to owners of capital. I'm not interested in debating whether this is healthy, and neither should the FOMC; that's not its job. But under these conditions, asset prices should be the primary driver of monetary policy, not wages or employment and certainly not the near-useless CPI-U. That driver is screaming slow down!!! and has been for some time now.

Re: Landlords are trying not to rent to startups in San Francisco

#139

Post by s73v3r »

jerrac wrote: post #123
mooreds wrote: post #7

Or, consider starting a company outside of San Francisco. Not just outside of SoMA, actually outside of San Francisco. (I know, I know, blasphemy.) Eventually the price of real estate and labor will be so high that the relative disadvantages of other locations will not matter.

I wish people would do that. I know when I see jobs that interest me, they're almost always in SF or NYC. Neither location is somewhere I'd flourish. Seriously, what is the actual appeal of SF? I just don't see it.

Huge tech community, almost perfect weather (it's not San Diego, but it's close), fairly liberal politics, diverse culture (means tons of interesting and fun cultural activities, and lots of interesting places to eat that you don't get somewhere that isn't a larger city).

You may not agree with or value those things, but a lot of tech people do.

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