Brookfield Asset Management (stock symbol BAM) owns considerable office space. In DTLA alone they pretty much own half of skyline via their subsidary Brookfield Properties.
The WSJ featured an interesting graphic today:
Basically more than 70% of office space are empty. Having been since spring. Why should people return? At what cost? It seems that wheels are still turning. Regardless if office drones show up – or not. Maybe there might a future market for temporary meeting spaces and rooms. Much easier to use them if they are shared. It is not that a meeting room would have corporation specific benefits.
So it seems that owning lots of commercial real estate being used as office would be bad for business. Since Brookfield is publicly traded one could expect that its stock is not doing so great. Turns out that that is not really true:
Yes, BAM trades higher today than it did in January. When business was ‘normal’.
This is nuts.
It also is crazy that seemingly more than 70% of people don’t need to show up for work at the office, and the sky is not falling. Which really raises the question: Why did they show up in the past?
Because a cubicle was a fun place to be? Because the commute is so much fun? Allot of time AND money flows into the daily mass migration from ‘burbs to city centers and back. Seems it can be replaced by a network connection people had for Netflix anyway.
What else do we do that we no longer need to do? Things get nudged along week by week. Month by month. Year by year. Decade by decade. All the while it could have been radically changed.
This is the real benefit of emerging countries like China: They can ask themselves at each step in any process how it could be done best. Not having a precedent of a somewhat working system gives amazing liberties.
I think at least half of work efforts in the US are being wasted. They could be optimized away. Mostly in the middle of these structures. Where work interacts with reality (blue collar) things have been optimized all the time. You can measure the throughput of a chamber maid much easier than that of an Excell spreadsheet jockey in some cubicle home office.