Why I’m Advising Clients to Stay Away from Office Space Investments
why I think office space is a category to stay away from:
It is, frankly, a
horribly competitive business made much worse today (from a landlord’s POV) by
a huge groundswell of folks using their home offices, incubators and coffee
shops with free wi-fi. There is a badly named Stockholm startup called Hoffice, where your
home is an apartment by night and a shared office by day. It’s a kind of
rent-a-co-worker deal. It also can be part of the sharing economy since it can
rotate locations—today my place, next week yours. No money may need to change
City Lab reports, “As
each Hoffice session begins, everyone in the group
shares what they plan to do with their day, also outlining what they think
might get in the way of reaching that goal. The day is then split into
45-minute sessions, interspersed with short breaks taken together.”
Sounds kind of hokey
to me, but it’s the death knell of traditional office space.
Large companies still
need to be able to gather the tribe together in one place, but even so, many of
them are hoteling their workers—no one gets an assigned workspace and their
hours vary widely—as a result they need less office space than they once did.
Making it worse, large
predators roam the office countryside—banks, REITs, penfunds, insurance
companies, publicly traded firms—who with their cost of capital falling below
1% can be profitable at lease rates far, far below what any entrepreneur would
have to charge.
I can beat Usain Bolt
in a 100-meter race; I know I can. I’ve timed myself. As long as he lets me
start at the 80-meter mark that is.
That’s what your
situation is if you are in a market populated by jaguars, when you are a
tortoise, which is the situation Terrace Investments Limited, the first parent company of the Ottawa Senators, faced in the late 1980s, and part of the reason why they decided to pivot from building office complexes to structures like Canadian Tire Centre along with ownership of a National Hockey League franchise.
Excerpt from: Don’t Back Down, the real story of the founding of the NHL’s Ottawa Senators and why big leagues matter, available from: https://www.brucemfirestone.com/ottawa-senators/.
@ profbruce @ quantum_entity
these are people working on unrelated projects or freelancers.
 Work From Home, Just Not
Alone and Not in Your Own Home, https://www.citylab.com/work/2015/02/work-from-home-just-not-alone-and-not-in-your-own-home/385101/.
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