I love this quote from the Oracle of Omaha.

Amazon found that giving things away for free isn’t a business and Shopify capitalized on wannabe-ism.

Facebook’s a better business than either of these but they’re paying $3Bil to terminate leases chasing a fad. So you take a bet but can’t stomach the wait? 

Hey Zuck, are we jumping the gun while the jury is still out on the future of work?

I’ve helped many borrowers. Hard times are here. Get your house in order. Go through your loan docs. What you see may surprise you AND save you lots of heartache.

Uninformed common sense reactions will kill you. Lenders will pursue personal guarantees - even though your loan is non-recourse.

It’s not about winning. If you’re in a PG case with a lender, financing other assets will be almost impossible. In commercial real estate, if you can't finance deals, you are up a creek.

Many if not most employers see value in the office space, but not the old model of sardine canning workers into the smallest cookie cutter space from 9-5 every day. 

Beyond that however, nobody seems to know, or at least be willing to have their balance sheets take a bet as to what the future of office actually looks like. 

Landlord’s with the misfortune of negotiating leases during this time of flux are getting allot of ask but being offered very little value in return and the sustained physics of such an arrangement — it’s impossible because landlords have expenses, tenant improvement costs and a mortgage to pay. A short term lease with low rent may be a necessary defensive move, but not many owners have the ability to fund it. 

Companies like JP Morgan, Goldman Sachs and Apple - they’ve  all mandated a return to office but they all have heavy bets in the space and lots of leverage with their employees. In talking with friends and colleagues such the amazing Ken Ashley and the always ‘cut through the cluttered data’ Neely Tamminga, it’s apparent to me that the question isn’t as much the future of office as its reintegration. We need a bridge to tomorrow. 

One would think that if technology has made the home a place from where you can work, then the technologically equipped office should be that much more efficient and effective in its own right. 

Solving this problem by just kicking the can is going to invite carnage. You need a proactive approach and that’s the only way that landlords will save their properties from a death spiral. 

How do we get landlords to provide experiential, useful space at a low cost? 
How do we provide tenants the optionality they need while extracting a commitment to a building? 

How do we train middle managers to guide employees into effective hybrid work efforts, so that return to office isn’t more of what you were anyways doing at home or just a day of social interaction that hurts productivity.

Sam Zell made the ultimate office trade years ago — and it paid off in spades! Finding the right formula this time around will result in similarly massive returns.