5 ms·

People have theorized that RTO mandates are shadow layoffs, but I think they might actually be commercial real estate investors trying to prop up the office mar

People have theorized that RTO mandates are shadow layoffs, but I think they might actually be commercial real estate investors trying to prop up the office market. If large companies are able to force RTO those working conditions will trickle down to smaller employers, which will stop the bleeding of tenants for small and midsized buildings. Those commercial office buildings are owned by REITs and investment banks. It's like if the landlords that own malls were allowed to ban online shopping.

threatofrain 2y ago
IMO remote work should be evaluated on a role-by-role basis because remote team coordination really is that much harder. The prima facie incentives actually lean hard in the direction of employers because you access the global market of developers, driving down cost big time and real estate is expensive. Thus remote coordination is so hard... that employers would rather pay for expensive real estate and expensive talent, including the burn on time for employees driving around.
- 8note 2y ago
  at least where im working, team coordination was already dying to dead before covid lockdowns started because all the realted teams were moving to far off locations. the coordination improved with dedicated remote compared to conference room to conference room remote meetings
- evujumenuk 2y ago
  So what you're implying is that for roles where other companies do have managed to establish functioning remote work protocols, we should interpret RTO mandates as a public display of organizational dysfunction if they were unable to emulate those within the span of, oh, five years? Also I'm pretty sure employers don't generally pay for, or care about, the commute times of employees…
  - spacemanspiff01 2y ago
    Yes, especially for something creative and collaborative like engineering. Creating a culture where remote work works as well as in person is hard, and takes explicit effort and buying from management.
    - hdjjhhvvhga 2y ago
      I agree to some degree - it's only hard at the very beginning. After that, it just becomes a part of the company culture. And you can feel it from the first days when you are onboarded or when you struggle with your first ticket.
  - threatofrain 2y ago
    Yes employers do care about commute. Commute time is one of the leading predictors of turnover, and it has a more dramatic effect on employee happiness vs higher salary. Also, it's de facto culture for programmers to work a little everywhere, on and off the clock (I'm not saying that's right, but it's reality). A certain well known big defense company used to subsidize rent if you agreed to live closer.
itake 2y ago
Why do the landlords have control over tech ceos?
- kcb 2y ago
  JPMorgan are the landlords. They just finished building one of the biggest skyscrapers in NYC for their use https://en.m.wikipedia.org/wiki/270_Park_Avenue_(2021%E2%80%93present) https://en.m.wikipedia.org/wiki/270_Park_Avenue_(2021%E2%80%... Someone needs to at least be able to portray a return on that investment.
- senderista 2y ago
  Institutional investors in Big Tech also have investments in commercial real estate?
- hdjjhhvvhga 2y ago
  In this particular case we are talking about a large company that owns a lot of commercial real estate and invests heavily in it. From their point of view, allowing people WFH is acting against the best interests of the company - if these commercial buildings are sitting empty, their value goes down. I see their point but as an employee I would never work for them unless completely broke and desperate - and even then only temporarily, just to have time to find a better job that allows WFH.
  - goodklopp 2y ago
    They could instead rent it out right? Employees are happy, money is flowing in. win win.
    - Ekaros 2y ago
      Problem is demand. If everyone else also have people working remotely... So what they have to first do is to show it themselves.
- disambiguation 2y ago
  I think most corporate America works this way. Every company has a board of directors (i.e stake holders (i.e investors, with many investments, including land)) they pass down edicts from on high. "If you want my money you have to do XYZ." From there c-suite executives figure out how to pull it off. Sometimes investments in one area affect decisions in another, which is technically a conflict of interest, which is technically illegal, but hey that's why America is famous for its corporate integrity.
tootie 2y ago
That really doesn't seem plausible. Why would JPM bother propping up commercial real estate? I think the answer is much simpler. Jamie Dimon is very opinionated and conservative and wants people back in the office because thinks they're slacking off at home.
- bdndndndbve 2y ago
  I'm not saying they're single-handedly propping up real estate, but they benefit from "number goes up" in the economy. If WFH becomes a durable trend and a bunch of commercial properties get written down it's going to have a big impact on a lot of investors. Many large companies either have real estate investments, or their owners are diversified into real estate. It makes sense for companies collectively to push in this direction not out of nostalgia but to avoid a massive correction.
- t-writescode 2y ago
  Our entire banking system is built on trusting that companies and individuals will keep paying their loans. If enough people don’t want commercial real estate, then those empty buildings will, at least for businesses, eventually start to default because they have no money. At least that’s my “off the top of my head” theory. It doesn’t change the fact that the US’s car-centric, NIMBY, segregated behavior has resulted in a world where in-office work is about as unpleasant as can be and greatly desired against.
  - tootie 2y ago
    Commercial real estate bottomed already. The market isn't going to collapse. Besides they obviously didn't make any similar hedges when it was residential real estate in 2007. Nor does it make sense for them to spend hundreds of millions on real estate so they can not lose money. There is no 4d chess. It's just old people making bad decisions.
    - ksec 2y ago
      >Commercial real estate bottomed already I think you are under estimating the problem with Commercial real estate, along with rental around the city that has on adjacent Commercial real estate pricing. Which also has a knock on effect on other financial instruments. The situation wont change or pops the Commercial real estate value to where it was. But it should hopefully buy some time for the market to solve itself. And this isn't just JPM literally eery bank and finance sector are forcing other sector ( other than tech ) to end Remote work.
mingus88 2y ago
Amazon is full RTO in my city and there are now lines down the block for the food trucks this week at lunchtime. I’m sure every business owner is conspiring together to get those captive office workers back in city centers where their wages can be siphoned.
- blackeyeblitzar 2y ago
  This is definitely the case in Seattle, where every news story about Amazon RTO seems to feature a restaurant owner or business association praising Amazon and ignoring that they’re really just stealing from the employees who lose 1-2 hours to commuting each day.
  - seanmcdirmid 2y ago
    Amazon employees are universally complaining about it, while Amazon is the only FAANG that is actively hiring right now (they must have higher turnover).
    - blackeyeblitzar 2y ago
      Weird to hear that they’re complaining. On LinkedIn, I often see Amazon employees talking about how RTO has been great or that there’s a positive side to it. Maybe they’re just managers? Or maybe the silent majority is too afraid to speak against it publicly? I feel like Amazon looks very bizarre to an outsider, almost cultish in accepting this new reality of RTO, all just to shill almost universally Chinese made low quality products. Either way if this didn’t spur them into unionization I don’t know what will. Not that I’m pro union either - I have concerns about how many of them run. But I feel like losing 1-2 hours daily is such a big cost that it’s worth dealing with that.
      - seanmcdirmid 2y ago
        No one is going to trash talk their company on LinkedIn, that’s just a quick way to being unemployable. I’m just talking about techies anyways, and the grumbling I hear in social conversations. It is difficult to get tech workers making > $200k/year to unionize. At that point, it’s more grumbling about first world problems than about oppressive working conditions (yes, working from home is better, but no, RTO isn’t some sort of unreasonable request for the compensation involved, but people will still complain of course).
ryandrake 2y ago
That theory has always seemed to me like the tail wagging the dog--a relatively small tail (commercial real estate) wagging a big dog (trillion dollar companies). If you look at the balance sheet of these companies, real property is significant, but almost always far from the largest investment they have made.
kkfx 2y ago
https://hbr.org/2024/07/u-s-commercial-real-estate-is-headed-toward-a-crisis https://hbr.org/2024/07/u-s-commercial-real-estate-is-headed... it could be retarded ad bit, not avoided.

threatofrain 2y ago

IMO remote work should be evaluated on a role-by-role basis because remote team coordination really is that much harder. The prima facie incentives actually lean hard in the direction of employers because you access the global market of developers, driving down cost big time and real estate is expensive. Thus remote coordination is so hard... that employers would rather pay for expensive real estate and expensive talent, including the burn on time for employees driving around.

8note 2y ago
at least where im working, team coordination was already dying to dead before covid lockdowns started because all the realted teams were moving to far off locations. the coordination improved with dedicated remote compared to conference room to conference room remote meetings
evujumenuk 2y ago
So what you're implying is that for roles where other companies do have managed to establish functioning remote work protocols, we should interpret RTO mandates as a public display of organizational dysfunction if they were unable to emulate those within the span of, oh, five years? Also I'm pretty sure employers don't generally pay for, or care about, the commute times of employees…
- spacemanspiff01 2y ago
  Yes, especially for something creative and collaborative like engineering. Creating a culture where remote work works as well as in person is hard, and takes explicit effort and buying from management.
  - hdjjhhvvhga 2y ago
    I agree to some degree - it's only hard at the very beginning. After that, it just becomes a part of the company culture. And you can feel it from the first days when you are onboarded or when you struggle with your first ticket.
- threatofrain 2y ago
  Yes employers do care about commute. Commute time is one of the leading predictors of turnover, and it has a more dramatic effect on employee happiness vs higher salary. Also, it's de facto culture for programmers to work a little everywhere, on and off the clock (I'm not saying that's right, but it's reality). A certain well known big defense company used to subsidize rent if you agreed to live closer.

itake 2y ago

Why do the landlords have control over tech ceos?

kcb 2y ago
JPMorgan are the landlords. They just finished building one of the biggest skyscrapers in NYC for their use https://en.m.wikipedia.org/wiki/270_Park_Avenue_(2021%E2%80%93present) https://en.m.wikipedia.org/wiki/270_Park_Avenue_(2021%E2%80%... Someone needs to at least be able to portray a return on that investment.
senderista 2y ago
Institutional investors in Big Tech also have investments in commercial real estate?
hdjjhhvvhga 2y ago
In this particular case we are talking about a large company that owns a lot of commercial real estate and invests heavily in it. From their point of view, allowing people WFH is acting against the best interests of the company - if these commercial buildings are sitting empty, their value goes down. I see their point but as an employee I would never work for them unless completely broke and desperate - and even then only temporarily, just to have time to find a better job that allows WFH.
- goodklopp 2y ago
  They could instead rent it out right? Employees are happy, money is flowing in. win win.
  - Ekaros 2y ago
    Problem is demand. If everyone else also have people working remotely... So what they have to first do is to show it themselves.
disambiguation 2y ago
I think most corporate America works this way. Every company has a board of directors (i.e stake holders (i.e investors, with many investments, including land)) they pass down edicts from on high. "If you want my money you have to do XYZ." From there c-suite executives figure out how to pull it off. Sometimes investments in one area affect decisions in another, which is technically a conflict of interest, which is technically illegal, but hey that's why America is famous for its corporate integrity.

tootie 2y ago

That really doesn't seem plausible. Why would JPM bother propping up commercial real estate? I think the answer is much simpler. Jamie Dimon is very opinionated and conservative and wants people back in the office because thinks they're slacking off at home.

bdndndndbve 2y ago
I'm not saying they're single-handedly propping up real estate, but they benefit from "number goes up" in the economy. If WFH becomes a durable trend and a bunch of commercial properties get written down it's going to have a big impact on a lot of investors. Many large companies either have real estate investments, or their owners are diversified into real estate. It makes sense for companies collectively to push in this direction not out of nostalgia but to avoid a massive correction.
t-writescode 2y ago
Our entire banking system is built on trusting that companies and individuals will keep paying their loans. If enough people don’t want commercial real estate, then those empty buildings will, at least for businesses, eventually start to default because they have no money. At least that’s my “off the top of my head” theory. It doesn’t change the fact that the US’s car-centric, NIMBY, segregated behavior has resulted in a world where in-office work is about as unpleasant as can be and greatly desired against.
- tootie 2y ago
  Commercial real estate bottomed already. The market isn't going to collapse. Besides they obviously didn't make any similar hedges when it was residential real estate in 2007. Nor does it make sense for them to spend hundreds of millions on real estate so they can not lose money. There is no 4d chess. It's just old people making bad decisions.
  - ksec 2y ago
    >Commercial real estate bottomed already I think you are under estimating the problem with Commercial real estate, along with rental around the city that has on adjacent Commercial real estate pricing. Which also has a knock on effect on other financial instruments. The situation wont change or pops the Commercial real estate value to where it was. But it should hopefully buy some time for the market to solve itself. And this isn't just JPM literally eery bank and finance sector are forcing other sector ( other than tech ) to end Remote work.

mingus88 2y ago

Amazon is full RTO in my city and there are now lines down the block for the food trucks this week at lunchtime. I’m sure every business owner is conspiring together to get those captive office workers back in city centers where their wages can be siphoned.

blackeyeblitzar 2y ago
This is definitely the case in Seattle, where every news story about Amazon RTO seems to feature a restaurant owner or business association praising Amazon and ignoring that they’re really just stealing from the employees who lose 1-2 hours to commuting each day.
- seanmcdirmid 2y ago
  Amazon employees are universally complaining about it, while Amazon is the only FAANG that is actively hiring right now (they must have higher turnover).
  - blackeyeblitzar 2y ago
    Weird to hear that they’re complaining. On LinkedIn, I often see Amazon employees talking about how RTO has been great or that there’s a positive side to it. Maybe they’re just managers? Or maybe the silent majority is too afraid to speak against it publicly? I feel like Amazon looks very bizarre to an outsider, almost cultish in accepting this new reality of RTO, all just to shill almost universally Chinese made low quality products. Either way if this didn’t spur them into unionization I don’t know what will. Not that I’m pro union either - I have concerns about how many of them run. But I feel like losing 1-2 hours daily is such a big cost that it’s worth dealing with that.
    - seanmcdirmid 2y ago
      No one is going to trash talk their company on LinkedIn, that’s just a quick way to being unemployable. I’m just talking about techies anyways, and the grumbling I hear in social conversations. It is difficult to get tech workers making > $200k/year to unionize. At that point, it’s more grumbling about first world problems than about oppressive working conditions (yes, working from home is better, but no, RTO isn’t some sort of unreasonable request for the compensation involved, but people will still complain of course).

ryandrake 2y ago

That theory has always seemed to me like the tail wagging the dog--a relatively small tail (commercial real estate) wagging a big dog (trillion dollar companies). If you look at the balance sheet of these companies, real property is significant, but almost always far from the largest investment they have made.

kkfx 2y ago

https://hbr.org/2024/07/u-s-commercial-real-estate-is-headed-toward-a-crisis https://hbr.org/2024/07/u-s-commercial-real-estate-is-headed... it could be retarded ad bit, not avoided.