https://fortune.com/2023/08/03/michael-bloomberg-billionaire-return-to-office-federal-agencies/

Empty offices are a problem that could result in another run on the banks, some economists have warned, with swaths of new office buildings financed on short-term loans with no leases taken out to pay for it. Morgan Stanley estimates that $1.5 trillion in commercial real estate loans are due to be repaid by 2025.

With 176 offices across the world—some of which cost more than $1 billion to build—it’s perhaps not a surprise that Bloomberg is keen to get his own staff back through the doors, a sentiment echoed by JPMorgan CEO Jamie Dimon.

  • PorkrollPosadist [he/him, they/them]@hexbear.netEnglish
    8·
    1 year ago

    It is, in fact, to the benefit of many businesses to downsize their physical presence in the office. If the only people who benefited from work from home were workers, we would see this policy abolished very quickly, but as it turns out, capitalist firms also hate landlords. This is a showdown between the FIRE sector and the whole rest of the economy, and I don’t think FIRE is going to win. Sure, these investment banks can drag all of their workers back to downtown Manhattan, but that is not going to bridge the gap.

    • Catalyst512 [he/him]@hexbear.netEnglish
      4·
      1 year ago

      What do you mean by the FIRE sector? Isn’t part of this push back to the office due to commercial real estate interests? I’m sure there are FIRE people who own “investment property” but I don’t know if that is the strongest force at play here. Not disagreeing with you just trying to get a better picture in my head.

      • PorkrollPosadist [he/him, they/them]@hexbear.netEnglish
        10·
        1 year ago

        Isn’t FIRE, Finance, Insurance, Real Estate? These seem to be the folks who are most deeply invested in returning people to work. The people who took out massive loans on these properties to develop them, with the expectation of steady rental incomes. A secondary effect of the abundance of unrented office space is a slump in development, as well as a slump in the value of residential properties in the immediate vicinity of these downtown economic zones (Who’s going to pay premium rents for an apartment in Midtown when they can telecommute from Maine?). Insurance, while being a very broad industry, is tied very closely with the Real Estate industry, and because of the extreme commodification of housing, this has broad effects on the entire financial economy.