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Nearly 12M Square Feet of Vacant Office Space in S.F

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Re: Nearly 12M Square Feet of Vacant Office Space in S.F

#231

Post by jtbayly »

reaperducer wrote: post #196
erosenbe0 wrote: post #66

Earlier quoted context omitted.

In terms of suffering, I'm more worried about the loss of support workers and supporting businesses over the long-term. Especially in a place like Chicago where the installed base of offices is much much larger than SF, and where portions of the future sales tax revenue has already been securitized and sold to investors.

Developers in Chicago are building as fast as they can right now. It's counterintuitive to people on the outside, but from what I read, it's because labor, material, and capital are dirt cheap. So the developers are putting up new skyscrapers and other mega-developments so they're in a good position to take advantage of the recovery. A new 57-story office tower opened just last week: https://www.chicagoarchitecture.o…

I was under the impression that building materials are very expensive right now.

Re: Nearly 12M Square Feet of Vacant Office Space in S.F

#232

Post by minitoar »

glorppe wrote: post #223

I’m licking my chops and hoping the SF bay does get cheaper; I’d love to live in the city or in Berkeley if the prices dropped significantly. Especially if commuting isn’t a big part of my life. Meanwhile, you couldn’t pay me an extra 100k a year to consider moving to the Midwest or Texas. I just value weather and nature and outdoor activities far too much to deal with those places. I guess if your family is there or…

And so are all the other younger people who want to live in the urban environment. This is why it won't get significantly cheaper.

Re: Nearly 12M Square Feet of Vacant Office Space in S.F

#233

Post by lotsofpulp »

jtbayly wrote: post #231
reaperducer wrote: post #196

Earlier quoted context omitted.

Developers in Chicago are building as fast as they can right now. It's counterintuitive to people on the outside, but from what I read, it's because labor, material, and capital are dirt cheap. So the developers are putting up new skyscrapers and other mega-developments so they're in a good position to take advantage of the recovery. A new 57-story office tower opened just last week: https://www.chicagoarchitecture.o…

I was under the impression that building materials are very expensive right now.

You are correct, metal prices are up 3x and wood at least 2x. Building might be happening due to demand, but not because the materials are cheap. It might be possible that labor in big cities might be cheaper, but I doubt it.

Re: Nearly 12M Square Feet of Vacant Office Space in S.F

#234

Post by jonahbenton »

reaperducer wrote: post #196
erosenbe0 wrote: post #66

Earlier quoted context omitted.

In terms of suffering, I'm more worried about the loss of support workers and supporting businesses over the long-term. Especially in a place like Chicago where the installed base of offices is much much larger than SF, and where portions of the future sales tax revenue has already been securitized and sold to investors.

Developers in Chicago are building as fast as they can right now. It's counterintuitive to people on the outside, but from what I read, it's because labor, material, and capital are dirt cheap. So the developers are putting up new skyscrapers and other mega-developments so they're in a good position to take advantage of the recovery. A new 57-story office tower opened just last week: https://www.chicagoarchitecture.o…

Exactly the same in NYC. Real estate investment is planned on 50-100 year basis. We're in for a 3-5 year blip from a utilization perspective, but on longer timeframes, now is really just a great time to add to the capital base.

Re: Nearly 12M Square Feet of Vacant Office Space in S.F

#235

Post by hogFeast »

lumost wrote: post #159
hogFeast wrote: post #68

Earlier quoted context omitted.

Agreed. Very hard to estimate that effect. With corporate real estate, it is inherently local (you cannot export an office) so the question is about the swings in vacancies. Have some markets seen ~15% vacancies before? Yes, corporate real estate is very cyclical, no-one builds for years, and then the market adds 40-50% in a few years. But when it gets to 30-40% then you are probably looking for examples outside the…

There are a lot of companies that require office space e.g. pharma, hospitals etc. I wouldn't be surprised to see established companies expand on cheap real estate and start offering closed offices to employees.

Warehouses is another one (in addition to coworking). I am not sure how easy it would be to rezone (some places have an industrial category that is separate from office/residential) but being able to fulfill orders out of city-centres is obviously attractive (but debt and equity would go to zero then, you could probably maintain prices with coworking but warehouse space is going to be a 90%+ loss).

Re: Nearly 12M Square Feet of Vacant Office Space in S.F

#236

Post by scarmig »

As a homeowner in San Francisco... this is great. The cost of living has been too high here for ages, and the prices distort both our society and the economy. It'll be rough for speculators, but in the medium term everyone will come out stronger.

After the pandemic, we'll have the chance to see real businesses start here that don't rely on giant checks from VCs for viability; new restaurants will see more opportunities to take risks, as the cost to rent will collapse; and we'll end up with people moving here who want to live here, not those who despise the city but feel compelled to move here in pursuit of the almighty dollar.

I encourage companies to continue to support remote work. And, if you do hate the city, please leave, move to Boise, and let people in who will appreciate it.

Re: Nearly 12M Square Feet of Vacant Office Space in S.F

#237

Post by znpy »

sebmellen wrote: post #116
umvi wrote: post #83

Earlier quoted context omitted.

Why not just print 1 million dollars per person and end poverty in one fell swoop? If there are no consequences for printing 3 trillion, why not print 300 trillion?

This is the worst strawman argument I've ever seen. The problem is precisely that corporations (especially badly managed ones) have been able to bleed the stimulus coffers dry, and they will continue to do so, because we have a system of government which caters to them. Direct payments and rent forgiveness are not "printing money", they are limited, specific relief packages targeted at people in need. These are peopl…

I think it was ironic?

Re: Nearly 12M Square Feet of Vacant Office Space in S.F

#238

Post by hn_throwaway_99 »

zeristor wrote: post #220
FreakyT wrote: post #172

Earlier quoted context omitted.

That actually seems like a really good idea — I’d love to see more housing in the “downtown core” areas of SF, which are like 95% office space.

It depends, and whilst San Francisco can’t be compared to Harlow there can be some tragic ramifications: https://www.bbc.co.uk/news/uk-england-essex-47720887

I mean, Terminus House was essentially turned into a large project where people were dumped, an approach that has shown similarly disastrous results in the US for decades. That's quite different from turning office space into desirable apartments.

Re: Nearly 12M Square Feet of Vacant Office Space in S.F

#239

Post by nicoburns »

quickthrower2 wrote: post #145
nicoburns wrote: post #100

Earlier quoted context omitted.

I think it's instructive to set aside money for a minute and think about things in real terms: if we shut things down, then which parts of the economy won't be functioning and what is the cost of that. For example: suppose hospitality workers are paid to stay at home. How is that paid for? Well actually it's entiely paid for by people having fewer of the hospitality experiences that they are used to. It is obvious wh…

I'm not concerned about justification for QE, but more about where is the limit of debt you can take on to provide cash to a vast population, and is there a better way to fix things? I see the problem as a lack of agility of the economy. The hospitality works could have another job, but those jobs can't get created fast enough. How can they get paid by other people rather than the government. Another question is post…

They don't need jobs because we don't need those people to work. What we need them to do is stay at home.

There shouldn't need to be any debt involved. It should be as simple as printing money (the central bank can do this) and distributing it to the people who need it. Normally this would cause excessive inflation because it would be injecting extra money into the economy. But it shouldn't in this case because it's injecting money that was already there until very recently.

Re: Nearly 12M Square Feet of Vacant Office Space in S.F

#240

Post by ngokevin »

ps747 wrote: post #178
dannyw wrote: post #148

Earlier quoted context omitted.

I don’t think everyone who lives in San Fran wants do life in San Fran. They’re here because that’s where the jobs are.

Disagree. I love SF. The Symphony is phenomenal, love the Opera and Ballet too. The parks are beautiful, and you can get out into nature in about an hour's drive. Living in SF is expensive, but salaries are high too. Especially if you're in tech like most on HN, you can have a very nice lifestyle here.

I like SF, but symphonies, operas, ballets, and beautiful parks are like the common denominator of major US cities.

But anyways I agree SF is beautiful in many areas, and no one should listen to any opinions of SF from anyone who calls it "San Fran" :)

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