Oso planning to go pro
I absolutely did NOT do that. I stated the fact that there was no decrease in the Chicago metropolitan area between 2010-20.Illiterate.
It actually is the right metric and completely relevant. But you don't want to use it because it doesn't support your point. People are acting like the entire area is in some sort of decay. It isn't. It will likely continue to grow because it is a vibrant area with a diverse economy. (Unlike Rockford, Flint and Youngstown.)Is it growing as fast as others? No. Will it fall behind places like DFW in the next couple of decades? Perhaps. But these are the same dire predictions people made when LA passed up Chicago a few decades ago - and yet here Chicago remains with nearly 10 million people in the metro.
June 20, 2023Return to Office Enters the Desperation PhaseThe next stage of getting workers back at their desks includes incentives like $10 to the charity of their choice — and consequences like poor performance evaluations if they don’t make the trek in.https://www.nytimes.com/2023/06/20/business/return-to-office-remote-work.htmlFor tens of millions of office workers, it’s been three years of scattershot plans for returning to in-person work — summoning people in, not really meaning it, everybody pretty much working wherever they pleased. Now, for the umpteenth time, businesses are ready to get serious.----These new policies come as business leaders accept that hybrid work is a permanent reality, with just over a quarter of full workdays in the country now done at home, and offices still at half their prepandemic occupancy. (Though that 50 percent occupancy metric combines Tuesdays and Wednesdays, when offices are bustling, with Fridays, when they tend to be ghost towns.)
People have been rushing to deem "the new normal" of office and/or hybrid work since 2021. And they keep constantly shifting. There is plenty still to be determined and worked out. One solution won't work for all job functions and industries.I was just at a major trade show and talked to colleauges of mine. Two companies in very similar functions and spaces in the industry, both implementing expanded WFH programs. One was raving about how well it was working. The other talked about the struggles and challenges and how it would simply not work without more concessions back to the "old" way of working. And neither were wrong or unreasonable and both have good culture/employee retention.Where did all the thinkpieces go about "the end of business travel"? Probably the same place as the large contract of a supplier to one of my oldest customers in HK. Traditionally, they had trimester meetings and sales teams were in HK 5-6 times a year. The supplier said post-COVID they had de-emphasized business travel and wanted to do more teleconferencing, even as HK was now open. Proposed annual meetings and bi-annual sales trips with more frequent video calls. My customer expressed their disinterest in it. Supplier stood firm, contract was not renewed. Now suddenly the supplier is saying they will travel more Bit of a tangent, but felt applicable.
The WSJ had an interesting piece on downtowns in major cities and it sure seems that the smart money guys are not betting on a resurgence of downtowns anytime soon. The article had a graph on cell phone activity in downtowns and several were under 35% of pre pandemic activity. The scary part of the story was the lost money in commercial real estate.I also try and follow the smartest people, and most are running from major cities. I have no idea what will happen long term but I do not see any reason why anyone would be bullish on any big downtown. I will say it makes me sad because I have always loved the action of being in the heart of a big city. While MKE is far from a big time city, I love having my office in a great location in the heart of the city and now am debating renewing my lease.
Simple. People want to LIVE downtown. Convert the commercial high rises into livable spaces until there is a balance. The cost of living in an urban center is extremely high, and a wise investor should consider converting while prices are high to maximize ROI.
Not simple ... it is incredibly difficult and expensive to convert commercial/office to residential, and only a small percentage of current buildings in most city centers are viable for such conversion.One big problem ... modern office buildings have huge footprints. No one wants an apartment/condo without a window. What do you do with the vast interior space? Also, ask Tower; converting these big buildings to residential is against most existing building and fire codes. All that means is another dump truck of money to bring them into compliance, meaning these are not affordable housing units but more units for the wealthy.-----https://www.nytimes.com/interactive/2023/03/11/upshot/office-conversions.htmlThe idea, however, is less like a sweeping fix and more like a set of intricate puzzles — a different one for each building. Each one must solve for local rules that say what counts as a bedroom, for structural columns and elevator shafts that shape where walls go, for construction costs and land prices that affect rent rolls. And they must solve, above all, for access in every unit to fresh air and sunlight.For many offices, this puzzle may be unsolvable, at least for now.
It's only as difficult as you choose to make it. Sure, it would cost a lot to retrofit, but it also costs a ton to tear down and rebuild. Tax incentives, long term empty commercial taxes, Public housing, etc. This isn't an unsolvable problem, it is an opportunity to change urban living.Also, if you're saying that a lot of these buildings would only be affordable for the wealthy, there are obvious problems with that argument. Require that a certain number of units are required for different income levels not to mention the downward pressure that more housing overall puts on housing prices.Your solution is what, exactly?
It's only as difficult as you choose to make it. Sure, it would cost a lot to retrofit, but it also costs a ton to tear down and rebuild. Tax incentives, long term empty commercial taxes, Public housing, etc. This isn't an unsolvable problem, it is an opportunity to change urban living.Also, if you're saying that a lot of these buildings would only be affordable for the wealthy, there are obvious problems with that argument. Require that a certain number of units are required for different income levels. Not to mention the downward pressure that more housing overall puts on housing prices.Your solution is what, exactly?
I'm on a short business trip the next two days. The market intelligence I just learned from the customers today was irreplaceable. If I didn't meet them in person I certainly would not have learned via videoconference.
He doesn’t have one. Just move to Fredonia
Try reading about six or seven posts above ....---“If anyone says that they know the way out of this difficult situation, they’re fooling themselves,” said Brian D. Taylor, the director of the Institute of Transportation Studies at the University of California, Los Angeles. “This is a really challenging time.”
New buildings with large footprints were never designed to be converted into residential units. Estimates are it would cost about $200/foot to cover in most urban cities. (the plumbing alone for kitchens and bathrooms would be a massive undertaking) And that is on top of $100/$300 foot to acquire the building.So a typical 1200 square foot 2 bedroom would have $240,000 in conversion costs. Add in the building costs; that condo would need to go for at least $500k to break even.What is the market for $500+k two-bedroom condos in a place like Milwaukee?What is my solution? Not pretending the unworkable is workable.Again, conversion works for many older low-rise buildings with small footprints. It does not work for large modern office buildings with big footprints, which is the majority of office space in most city centers.
Between 2016 and 2023, several of the building's major tenants announced that they would be vacating their spaces. A number of these businesses moved up Water Street to the newly opened BMO Tower (Milwaukee). In 2023, Klein Development and developer and investor John Vassalllo purchased the building and announced plans to convert the building into 350 luxury apartments by 2026. The buildings small floorplates make it unattractive to modern office use, but the high quality of construction, views and location make it appealing to residential conversion.
You're doing back of the napkin math and making a ton of assumptions regarding a complex issue. Good job, good effort.
You're doing back of the napkin math and making a ton of assumptions regarding a complex issue. Good job, good effort.There are a lot more small/medium size commercial buildings in downtown Milwaukee that can be repurposed. I never suggested taking the US Bank building and loading it with condos. Curious that you chose Milwaukee instead of SF. But you probably did that because you checked zillow and noted that there were over 400 results for condos over $500k with 2+ bedrooms. But I understand why you'd choose Milwaukee. It better fit your claims.https://en.wikipedia.org/wiki/List_of_tallest_buildings_in_Milwaukeehttps://en.wikipedia.org/wiki/100_East_Wisconsinhttps://www.jsonline.com/story/money/real-estate/commercial/2023/03/10/100-east-office-tower-conversion-to-350-apartments-to-happen-by-2026/69994734007/I guess someone already had the idea to swap to luxury apartments in Milwaukee. Oh shoot, I thought that idea was all mine! Perhaps instead of listening to what one doomer says, perhaps look to what the investors and banks have actually decided was a good idea. Might there be problems or financial woes? Yes, of course, but that is investing. Your solutions seems to be to throw your hands up in the air and say, "Nothing to be done! Sky is falling folks!"
Oh, well then nothing, I guess. This one guy says so. So it must be!