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.
I don’t get the financial advantage of RTO to a company that was more in the business of using the space than selling/leasing it out. If they owned the space, what’s the problem? Maintenance is easier, you can remodel whenever and now have the option of selling. If they were leasing, they can stop or renegotiate for better terms. Are has fallen for a sunk cost fallacy?
