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Seems nuts to me, but CEOs also get an interesting pressure not to effectively be in a second sector through real estate holdings, etc, so even if long term sub
by fatfingerd 3y ago
Seems nuts to me, but CEOs also get an interesting pressure not to effectively be in a second sector through real estate holdings, etc, so even if long term subleasing would have paid off they may not have wanted to.
I guess its that having a lot of assets in a lower alpha sector will dilute the upside in a boom compared to a company that is totally leveraged to have all its value operating in the one sector. Fiscal madness.
- SilasX 3y agoI get that in theory, but this seems like a special case where they'd want to apply some judgment, especially since it requires a massive commitment of upfront capital that FB could almost certainly deploy more efficiently somewhere else. Like, maybe I'd understand if the payments were due in a slow trickle over time, but article says that FB has already paid the full amount. This would compare to say, taking a small loss each month on the difference between the rent due and what a leasing manager could net from subleases. (Though I guess 149m is a rounding error to FB.)