Power Reads: 5 Interesting Articles That Will Help You This Week

Each week, I select a few articles that rise above the fray and hopefully help you on your journey in leadership and the CRE world. They pull from one of four "corners": corporate real estate, technology, management science and anything positive. Each day we can become a better version of ourselves.

1. From 'The Butt End Of Real Estate' To Blind Bidding Wars: Inside The Staggering Rise Of Industrial

When Rooney Daschbach started working warehouses in 1986, finding tenants was a struggle. 

“He would advertise teaser rates of 25 cents a square foot for the South Bay Los Angeles properties he was marketing, sending out rate cards illustrated with pictures of quarters. To woo tenant reps, he and colleagues would offer free weeklong vacations to Hawaii, even the occasional car. ”

In a market with 12% vacancy, he would even allow tenants to lease space month-to-month, letting them pay just enough to cover warehouse owners' operating expenses and pay their mortgage.

2. Design an Office that People Want to Come Back to

As the Covid-19 crisis enters its third year and the Omicron variant surges, organizations around the world are contemplating how, when, and even if to have their knowledge workers resume regular in-office hours. And they do so at a time when the views and priorities of their employees have shifted. A recent McKinsey study showed that well-being, flexibility, and work-life balance are top of mind. A survey Microsoft conducted last year indicated that 41% of the global workforce would consider switching jobs in the next year, with 55% noting that work environment would play a role in their decisions.

“Our firm was put in a unusual position in 2020: we were hired to design the headquarters of the Korean fintech company Hana Bank during the very period when the pandemic was forcing business leaders to rethink the purpose of the office. But the process — and the resulting building — wasn’t a reaction to Covid. Rather, the crisis highlighted and accelerated trends that had been bubbling under the surface for years, including an increased focus on employee mental and physical health, the needs of a multi-generational workforce, greater emphasis on corporate purpose, and the shift to remote work.”

The pandemic raised the stakes for companies looking to retain top-tier employees and build thriving cultures. Here are some of the principles we employed and lessons we took away from the Hana Bank project as well as our recommendations for how organizations can implement both small and large-scale changes in enticing people to return to in-person work.

3. The Office Market May Be Turning a Corner

There’s some good news for the office market, according to Transwestern. In the company’s 2021 Q4 review, there was quarterly office absorption of 644,000 square feet, which the company described as “turning a corner,” as “33 out of 51 tracked markets registered positive net absorption as market correction is underway.”

“The five areas with the biggest increases in net absorption were in Boston, San Jose-Silicon Valley, Dallas-Fort Worth, Seattle, and Charlotte. When looking at trailing four-quarter net absorption, the top five were Austin, Raleigh-Durham, San Jose-Silicon Valley, Oklahoma City, and Nashville. About 30% of the markets that Transwestern tracks showed positive net absorption over the previous 12 months.”

Seattle, San Jose-Silicon Valley, Charlotte, Austin, Salt Lake City and Raleigh-Durham had all been experiencing an expansionary trend, meaning positive net absorption percentage of office space before the pandemic.

4. That Blinking Office Voice Mail? Don’t Worry. Everyone Else Ignores It, Too.

Chris Galdieri hasn’t checked his work voice mail in nearly two years and he isn’t sorry. Like millions of office workers, Mr. Galdieri, a professor at Saint Anselm College in Manchester, N.H., was sent home at the start of the pandemic. A few months later, when he came back to pick up some books, he glanced at his desk phone and saw his voice mail was full.

“He cheerfully walked away. “It was like, everything else in the world is on fire, everything’s falling apart, but at least I’m not getting any more voice mails,” he says. Even after he resumed on-campus teaching last fall, he didn’t bother tackling the blinking light on his phone. By now, he can’t remember his passcode. “I can’t say anyone’s noticed or complained,” Mr. Galdieri said.”

When a hush swept offices in March 2020, cubicle plants started withering. Snacks went stale. Shelves sprouted cobwebs. Missed calls mounted. Fast forward nearly two years, and even after some workers have returned to their desks—plants revived, furniture vacuumed—the red lights on many office phones still blink forlornly.

5. A Few Years Ago, This College Dropout Was on Food Stamps. Now He Owns a $90 Million Company

Scott Everett's Dallas real estate company, S2 Capital, spends years working to turn underperforming or distressed properties into moneymakers. It's a tremendously successful business model--and, in a way, a metaphor for Everett's entire adult life.

“Less than a decade ago, Everett was a teenage father and community college dropout waiting tables and relying on government assistance. Since then, he has taught himself the real estate business, weathered a recession-battered housing market, and built a 250-employee business that last year generated $89.5 million in revenue.”

Everett wound his way through multiple areas of the real estate industry before hitting on one that worked. He first attempted to improve his station by flipping houses, an unfortunate choice in 2007-08. With the market imploding, he shifted to the commercial side, and later began focusing on apartment complexes.

Your success blesses others. I wish you a great and hugely impactful week!

Power Reads: 5 Interesting Articles That Will Help You This Week

Each week, I select a few articles that rise above the fray and hopefully help you on your journey in leadership and the CRE world. They pull from one of four "corners": corporate real estate, technology, management science and anything positive. Each day we can become a better version of ourselves.

1. NYC's Office Leasing Recovery Is Being Fueled With Piles Of Landlord Cash

Owners of the country’s most expensive offices are luring occupiers with massive incentives, with the average cash payments given to Manhattan tenants now double what it was five years ago.

“In 2021, the average cash payments in the borough given to tenants were $154 per SF, The Wall Street Journal reported, citing CBRE data. That is up from an average of $76 in 2016. The incentives, which come in the form of landlords paying build-out costs and tenants’ moving expenses, are pushing rents down — even if it doesn’t show up in the official figures.”

“Face rents have not changed since the pandemic, but that’s not the story,” Savills Vice Chairman Jeffrey Peck told the WSJ. “The story is the fact that landlords are now receiving 20% less than what they had been receiving prior to the pandemic.”

2. Google Is Going All-In on In-Person Work, Which Could Be Great News for Office Investors

The pandemic has dealt a dreadful blow to office REITs, or real estate investment trusts, and the worst may still be yet to come. That's because we're nearing the two-year anniversary of not just the start of the pandemic but also remote work.

“To be clear, remote work was a thing prior to the COVID-19 outbreak, but it wasn’t common. These days, a large chunk of the labor force is working remotely, whether by choice or otherwise. And the fear among real estate investors is that office REITs will lose value if buildings continue to sit vacant for months on end.”

But at a time when so many companies are delaying their office return plans due to the omicron outbreak, Google is actively investing in office real estate. And that alone is a sign that investors shouldn't be too quick to lose hope.

3. Sephora To Expand San Francisco Headquarters in Landmark Pandemic Office Lease

Beauty giant Sephora is injecting a dose of optimism into San Francisco's sagging office market by agreeing to take over all 16 floors of downtown space that technology giant Salesforce had sitting on the sublease market for nearly a year.

4. The Rich Get Richer: Manhattan Sees Record Number Of Office Leases Crack $100/SF

Manhattan’s office market saw a record number of triple-digit rent leases in 2021, more evidence that the flight-to-quality phenomenon is further boosting the fortunes of the owners of new buildings.

“Tenants signed six leases with starting rents of $200 per SF or more in 2021, according to a JLL report, a price point previously seen only a handful of times in the history of New York. The 164 leases signed at $100-plus starting rents were also a New York City record. In 27 of those deals, tenants agreed to pay between $150 and $199 per SF.”

While the 3.4M SF leased at over $100 per SF fell short of the all-time mark, the total represents a 60% increase from 2020, compared to the overall leasing market in the city, which grew 32% year-over-year. Deals over $100 per SF accounted for 19% of all office leasing in Manhattan last year, according to JLL. 

5. Corporate America is coming around to remote work. But more big changes lie ahead

Nearly two years after millions of Americans became abruptly acquainted with Zoom, questions about what the post-pandemic office will look like can be answered with a quick look around: It’s already here.

“The case for the functionality of remote work has largely been settled: The wheels of productivity continued to hum on Wall Street and in Silicon Valley and other corporate strongholds even as their sprawling offices lay vacant. Employees stayed home and learned how to live at work. And throughout 2021, profits rolled in.”

Corporate leaders attempting to coax employees back to the office have largely accepted the inevitability of the hybrid work model — a strategy buttressed by the reality of raging coronavirus rates, a tight labor market and the nation’s more than 10 million job openings. Now they are learning to leverage its benefits, according to Adam Galinsky, a professor of leadership and ethics at Columbia Business School in New York. That includes more flexibility and less time commuting for employees, and lower real estate and operating costs for companies.

Your success blesses others. I wish you a great and hugely impactful week!

Power Reads: 5 Interesting Articles That Will Help You This Week

Each week, I select a few articles that rise above the fray and hopefully help you on your journey in leadership and the CRE world. They pull from one of four "corners": corporate real estate, technology, management science and anything positive. Each day we can become a better version of ourselves.

1. Office Occupancy Hits New Pandemic-Era High

Despite the lingering effects of Thanksgiving dinners across the nation, more workers returned to office buildings in the first week of December than at any point in the last 18 months.

“Average office building occupancy across the 10 largest office markets rose to 40.6% on Dec. 1, 8.1% higher than the post-holiday week last year, according to Kastle Systems, which tracks electronic keycard, fob and building access data.”

Texas and California continue to be at the extremes in office return: Austin and Houston, at 59.3% and 54.9% of pre-pandemic levels, respectively, have the most heavily trafficked office buildings, while San Francisco saw occupancy hit a pandemic high-water mark of 28.3%.

2. Working Vacations Have Never Felt This Good

BRANCHES PBC

After working long hours on tight deadlines for a big project as a landscape designer in Pittsburgh, Daryn Cassada was burned out. So her boss paid for a week away at a wellness resort in Hilton Head, S.C. It wasn’t exactly a vacation, but it wasn’t a work trip either.

“Ms. Cassada exercised, took mindfulness classes, ate gluten- and sugar-free meals, and dialed in to calls as needed to help keep projects for her real-estate company moving forward.”

“Most of the people who were there were actively working,” she said of her time at the resort this past October. “They’d be out there with their computer getting it done, and making sure they made it to their next Pilates class.”

3. The Escape From The Home Office

Thomas McConnell

Office culture has been around for years. Cubicles, coffee mugs, and printer paper are just some things that are commonly thought of when thinking about offices. However, we are starting to see a shift from the more traditional, individualized workspaces to offices that foster hospitality and collaboration. In early 2020 at the outset of the COVID-19 pandemic, many people packed up their office desks and started working from home. As a result, workplaces have started to change.

“Since there are fewer people working in offices every day, companies are starting to downsize their space. Health and safety precautions have been implemented into workspaces to allow people to feel safe and comfortable as they work. What’s more, office amenities like open meeting spaces, collaboration rooms, wellness areas, individual focus rooms, fitness centers, café-style break rooms, and multipurpose rooms are on the rise. Now more than ever, there is a strong correlation between hospitality, wellness, and the workplace.”

There has always been a tie in between hospitality and the workplace. Office spaces were designed with amenities like break rooms in mind and considered ergonomics for worker comfort. Workspaces were individualized and created a sense of separation amongst coworkers. Cubicles were the norm and only a small portion of offices were dedicated to teamwork.

4. U.S. Jobless Claims Fall to Lowest Level in 52 Years

A strong economic recovery and persistent labor shortage pushed jobless claims to their lowest level in more than half a century last week, just 18 months after the pandemic prompted six million workers to file for unemployment in one week.

“First-time claims for unemployment benefits, a proxy for layoffs, fell to 184,000 in the week ended Dec. 4, the lowest level since September 1969, the Labor Department said Thursday. The previous pre-pandemic low of 194,000 was recorded late last month.”

Unemployment claims have been steadily falling all year as the labor market has tightened amid a shortage of available workers. While the Omicron variant of Covid-19 represents another threat from the pandemic, economists expect labor market conditions to remain tight.

5. Companies Plan Big Raises for Workers in 2022

Companies are planning for steeper wage increases next year than at any point since the 2007-2009 recession, according to a new report, amid a tight labor market and the highest inflation in three decades.

“A survey by the Conference Board set for release Wednesday finds that companies are setting aside an average 3.9% of total payroll for wage increases next year, the most since 2008.”

The survey also shows that companies are planning on raising salary ranges, which would result in higher minimum, median and maximum salaries. That suggests pay raises could be broad-based and affect workers across a company’s pay scale.

Your success blesses others. I wish you a great and hugely impactful week!

Power Reads: 5 Interesting Articles That Will Help You This Week

Each week, I select a few articles that rise above the fray and hopefully help you on your journey in leadership and the CRE world. They pull from one of four "corners": corporate real estate, technology, management science and anything positive. Each day we can become a better version of ourselves.

1. Was the Office Always This Distracting? Get Ruthless About Your Productivity Now

You’re back at the office. How are you supposed to get any work done? There are in-person meetings and intractable Zoom calls clogging your calendar. Your commute has eaten the hour you once used to corral your inbox. And everyone wants to say hi.

“There’s this slow drip of half-baked conversations. ‘Do you have a minute? Do you have a minute? Do you have a minute?’ ” says Maura Thomas, a productivity trainer based in Austin, Texas.”

Focus in the office has long been tough, especially since companies started ripping down walls in the name of collaboration and lower real-estate costs. But after more than a year at home, the return can feel almost designed to kill your productivity. The background noises sound louder. Your chatty co-worker has 18 months of gossip to share. And there you sit, at your desk, exposed.

2. Offices Still Have a Role to Play But Must Adapt to New Needs

Shutterstock / G-Stock Studio

Flexible working has not killed the office; it died in the 1990s. Back then, when you left the office on a Friday, no one could contact you until you were back in the office on a Monday. You were either at work in the office or at home.

“Then mobile phones arrived, followed by email, laptops and wifi. Work infiltrated home life, and life infiltrated work. But the office has been slow to adapt even though working now is fundamentally different to the 1990s.”

Change will have to happen. There is a work evolution under way unlike anything the office market has experienced before. Yes, we have seen some wacky features such as slides and we have seen the introduction of hot-desking, breakout areas and co-working, but this is different.

3. These 6 Basic Human Needs Should Drive Your Office Design

Getty ImageS

What do you need from your physical space to be most productive at work? That’s the question Kristin Cerutti, design leader at architecture firm Nelson, and Jill Pable, professor and chair of the Interior Architecture & Design Department at Florida State University, asked last month during a presentation at the NeoCon 2021 design conference in Chicago.

“While their answers varied from “sunlight” and “quiet places to focus” to “comfortable seating with a good place to put a necessary cup of coffee” (or for many of us, several throughout the day), the recurrent theme was that workplaces need to “support each individual’s specific needs while still maintaining continuity,” as Cerutti said during the session.”

“Places are not just physical settings, and people are not just bodies that occupy those settings,” added Pable. “People are affected by their environments, which in turn affects how they view themselves, other people and their jobs. We, as designers, should see places as situational environments, and we can’t underestimate the potential of physical space to operate in tandem with other organizational things like trainings, collaboration, learning and workplace interactions. The right setting encourages productivity and well-being.”

4. Your New Office Set-Up Is Going to Look a Lot Like the Old One

As companies prepare for a post-pandemic world, the much-mooted “hub and spoke” workplace model is evolving in unexpected ways. Forget the idea of a city-center office hub and a handful of smaller, suburban spoke offices. Most large corporates are doubling down on existing prime locations, hoping to lure workers back to the office with swish buildings and proximity to restaurants and shops. In the new hybrid set-up, the low-cost, commute-free spoke is your own home.

“For companies that do see a benefit in having additional formal work locations, the answer is not — as some predicted early in the pandemic — directly leasing secondary office spaces in the suburbs. Instead, companies are partnering with flexible workspace providers to give employees access to a network of locations.”

Both options allow companies to cut space overall and swerve difficult decisions about picking non-central locations for dispersed staff. They also avoid the risk of secondary offices becoming, well, secondary, while senior managers and staff with big ambitions or limited responsibilities outside of work gravitate to HQ.

5. Why Companies Should Consider the ‘Hubquarters’ Model

MKDA

Companies are finally moving away from the traditional workplace centered around a corporate headquarters where employees gather on a daily basis and all the leadership presides. When employees were forced to adjust to working away from the office during the pandemic, some discovered that their productivity relied less on where they work and more on how they work.

“Now, employers are looking at innovative workplace models that incorporate the new lessons learned during the pandemic. These models include improved versions of prior workplace trends. Hub and spoke, for example, is a popular model used by many companies that includes one central office and smaller satellite offices. ”

The newest version of that is “hubquarters,” a network of smaller locations designed for both collaboration and independent work. These could be a cluster of small offices, coworking spaces and other remote locations, including home offices. All locations can be a vibrant part of the network, with key leadership present and a dynamic mix of teams collaborating in various combinations to meet  increasing employee demands for flexibility. 

Your success blesses others. I wish you a great and hugely impactful week!

Power Reads: 5 Interesting Articles That Will Help You This Week

Each week, I select a few articles that rise above the fray and hopefully help you on your journey in leadership and the CRE world. They pull from one of four "corners": corporate real estate, technology, management science and anything positive. Each day we can become a better version of ourselves.

1. With Tenants 'Committed to the Office,' Boston Properties Expects Widespread Return to Work

One of the nation's largest developers and office landlords is banking on an eventual sweeping return to the workplace as it sees the appeal of remote work dissolve.

Boston Properties said despite lagging occupancy and tenants' delayed return dates, an enduring commitment by businesses to physical space has been evident in increased touring activity and space requirements, a flurry of blockbuster leases and a willingness to agree to longer-term deals.

For Boston Properties, anticipating that return has meant repositioning traditional office developments to cater to accelerating life science demand and weighing a restart for projects it shelved at the onset of the pandemic. The developer had more than $1.05 billion of projects moving through its construction pipeline by Sept. 30, a marked increase from the $868.8 million reported at the same time last year.

2. Here’s Why Employees at Top-Performing Companies Need the Office

n Gensler’s global workplace surveys over the last year, “working in-person with my team/colleagues” was ranked the number one reason to come to the office. That’s still true, but it’s far more nuanced than that. Our latest research reveals that top performing companies value the office for more than just collaboration. We uncovered a wide range of work activities people prefer to do in the office — both individual work and working with others.

According to our U.S. Workplace Survey 2021 research, workers at top-performing companies prefer the office for a much wider range of activities than workers at unranked companies, including deep concentration, ideation, and creative tasks. Top-performing companies’ employees are nearly twice as likely to prefer the office for individual thinking/ideation. They also prioritize in-person work over virtual work, in particular for giving and receiving in-person feedback.

For individual reflection or conceptual tasks, however, they are more likely to prefer a wider variety of places — both in and out of the office. (In this study, we define top-performing companies as organizations that have recently been ranked on a Most Admired, Best Places to Work, and Most Innovative Companies list.)

3. 'Stunning' Percentage Of Companies Haven't Set Hybrid Work Plans: EY Survey

Company leaders are increasingly finding that their businesses function better with workers at home at least some of the time, and most firms have yet to put formal arrangements into place.

The shift to hybrid work could have a knock-on effect on corporate real estate strategy with major office market impacts: a move away from a centralized headquarters. 

Seventy-five percent of the 500 U.S. C-suite and business leaders Ernst & Young surveyed in its inaugural Future Workplace Index said they don’t expect having one main work location in the long term.

4. Broker 2.0: $1.5B Investment Into Proptech By Big Firms Is Changing How They Operate

The nation's biggest brokerages have invested almost $1.5B in proptech deals over the past 10 years. They know the world is changing, they know they need to stay ahead of that change, and they have put up real money to invest in the future. But what has that investment actually bought them?

The real estate industry is being redefined by extensive investments in new technology. Global venture capital investment in proptech exceeded $61.1B since 2010, according to investment data from Pitchbook.

While venture capital investors and tech startups seek to create breakthrough products and change how the industry operates, change is also coming from within, in the form of big brokerages and real estate service firms investing in their own technology and even creating their own technology investment funds.

5. Rick Steves on the Return of Travel and Why It Matters

On a recent morning, Rick Steves was wandering around the ancient Tuscan town of Volterra with a new crop of tour guides. His company’s trips to Europe are set to resume in February after a nearly two-year pandemic hiatus, and the guides were midway through a nine-day trip around Italy to learn “what makes a Rick Steves tour a Rick Steves tour.” One of the stops on their itinerary was Volterra, a medieval hilltop town whose stone walls are 800 years old. Mr. Steves — who has been to Tuscany many times for his popular public broadcasting show and YouTube channel — was relishing being back.

“We’re surrounded by the wonders of what we love so much, and it just makes our endorphins do little flip-flops,” he said during a phone interview.

That unabashed enthusiasm has fueled Mr. Steves’s empire of guidebooks, radio shows and TV programs, as well as tours that have taken hundreds of thousands of Americans overseas since he started running them in 1980.

Along the way, Mr. Steves has built a reputation for convincing hesitant Americans to make their first trip abroad — and that first trip is often to Europe, which Mr. Steves has called “the wading pool for world exploration.” But he also speaks passionately about the value of travel to places like El Salvador and Iran, and he’s open about how his time in other countries has shaped his views on issues like world hunger and the legalization of marijuana.

Your success blesses others. I wish you a great and hugely impactful week!

Power Reads: 5 Interesting Articles That Will Help You This Week

Each week, I select a few articles that rise above the fray and hopefully help you on your journey in leadership and the CRE world. They pull from one of four "corners": corporate real estate, technology, management science and anything positive. Each day we can become a better version of ourselves.

1. One Size Doesn’t Fit All: Employees’ Needs Are Changing Work Spaces

Not surprisingly, traditional offices appear to have been radically altered by the pandemic, perhaps forever.

According to Grant Christofely, North American associate director of workplace strategy at M Moser Associates, a workplace design company, some organizations still design their offices the same way they did 50 to 70 years ago: static, inflexible spaces where employees perform individual, task-oriented work more than eight hours a day.

“But that’s not how works gets done, how you make money today,” he said. “You make money from ideas being exchanged. And technology has had a huge impact on the way people work, the way ideas are exchanged. The way ideas were exchanged was changing before the pandemic — people are realizing that the time to change is now.”

2. To Get Ahead at Work, Lawyers Find It Helps to Actually Be at Work

The only suspicious note was the relative lack of millennials. Near the very end, a first-year associate darted into the room, grabbed a plastic-wrapped ice cream bar and darted out again, barely exchanging more than a sentence or two with colleagues. It seemed like a rebuke to the whole affair.

Yet when I later tracked down the associate, Akshita Singh, expecting to find her disillusioned with the office return and irritated by the oldsters trying to sell it, it became clear that something else was going on: She wasn’t conscientiously objecting to the office. She had actually embraced it.

“I’ve been coming in every day,” said Ms. Singh, who turned out to be swamped that afternoon. “It’s nice to leave my laptop here knowing I’ll come back tomorrow.”

Since the beginning of the year, as mass vaccinations loomed and “return to office” became an incantation so popular it earned its own abbreviation, workers under 40 have been notably resistant.

3. After pause for Delta variant, office returns once again on the rise. Here's how to welcome workers back.

Even with the Delta variant derailing many employers' plans, September was still a big month for returning to the office.

There was a 21% increase in workers returning to the office in September compared to August, according to workplace platform Robin.

The month-over-month increase was the first since June, and Robin expects that increase in office visits to continue through November before dropping around the holidays.

4. How to Reframe What Work Means to You

When I was a teenager, I got a summer job working in a grocery store. All day long, I took vegetable cans out of boxes, hit each one with a price tag gun, and placed them on the shelf. Again. And again. And again. I felt every minute of every hour stretch to a standstill. I had no contact with customers, and I hardly ever saw a manager.

Then I got lucky: I was hit by a forklift behind the store. A bruised tailbone got me paid sick leave until the end of the summer. Since the only reason I took the job was to earn money to buy myself a new bike, I was very happy!

But of course there’s something wrong with this story. Is work really just something we must endure so we can afford to do something else — like riding a bike? Or is there more? Why do we work?

I believe this question carries fundamental implications for business leaders, as I’ve described in my recent book The Heart of Business. The answer each of us gives influences our attitude toward work and how invested we are willing to be as individuals, and thus whether we and our companies thrive.

5. Unlimited vacation days? More employers are embracing the policy.

More companies are implementing unlimited vacation policies in the Covid-19 era, but experts say implementing the policy is hardly a day at the beach.

Interest in offering unlimited paid time off is rising as companies seek to save money and distinguish themselves in a competitive labor market.

Nicholas Reiter, a partner and co-chair of the labor and employment practice group at Venable LLP, said he has noticed an uptick in employers transitioning from an accrual system to unlimited PTO — and the rise of remote work during the pandemic is one of the factors.

Your success blesses others. I wish you a great and hugely impactful week!

Power Reads: 5 Interesting Articles That Will Help You This Week

Each week, I select a few articles that rise above the fray and hopefully help you on your journey in leadership and the CRE world. They pull from one of four "corners": corporate real estate, technology, management science and anything positive. Each day we can become a better version of ourselves.

1. Madison Avenue Landlords Hope for Revival as Local Residents Return

The street that dresses Manhattan’s wealthiest residents is still wearing the scars of the pandemic. But recently, there are signs of healing on Madison Avenue.

The famed shopping district, which relies more on locals than tourists, is coming back to life as New Yorkers return to the city, head back to the office and attend society events such as the Met Gala. Falling rent prices and rising availability have also created opportunities for younger retailers and even pop-up shops to open in storefronts normally reserved for established luxury brands.

Lower rents are motivating new tenants as well as others relocating from elsewhere in the city to sign leases, said Steven Soutendijk, executive managing director for Cushman & Wakefield Retail Services. Affluent Madison Avenue shoppers haven’t been hit by the pandemic to the degree they were during the 2008 financial crisis.

2. Burning the Candle at Both Ends: Pandemic Burnout While Working from Home

A recent study revealed that 75% of the U.S. workforce has experienced burnout, with 40% citing Covid-19 as a significant contributing factor, (Reynolds, 2020).

The World Health Organization recently recognized workplace burnout as an “occupational phenomenon” (WHO, 2019). During the Covid-19 pandemic, the chronic stress associated with workplace burnout has migrated from the office to the home.

A series of interviews conducted by Ware Malcomb revealed concerns about burnout and the need for remediation techniques to support the home-workforce.

3. Office Occupancy Stabilized In Q3, Ushering In The Next Phase Of Uncertainty

Office leasing in the third quarter saw its first rays of sunshine since the coronavirus pandemic began, but the trajectory of the next few quarters is still clouded with uncertainty.

Net absorption for office buildings nationwide hit its best level since before the pandemic began in Q3, with quarterly research reports from JLL and Plante Moran Cresa finding negative absorption of between 7M and 13M SF, about a third of the level seen in Q2. Quarterly data supplied by Colliers found 3.3M SF of positive net absorption, representing the first positive absorption since Q1 of last year.

Roughly half of the markets for which Colliers has Q3 data had positive net absorption in the quarter. In about half of those markets, the positive absorption was less than 100K SF, suggesting the office-using economy on the whole is in a similar phase, with secondary, tech-heavy markets like Austin, Nashville and Salt Lake City seeing the most positive absorption, Colliers Director of National Office Research Stephen Newbold said.

4. ‘There’s Not A Miracle Cure’: Port Experts Start Detailing Plans To Ease Supply Chain Disruptions

Port experts have followed President Joe Biden's Wednesday announcement that the Port of Los Angeles would move to 24/7 operations with further solutions, some of which would get commercial real estate more directly involved in solving the problem.

Biden made the announcement Wednesday to address sustained disruptions to the supply chain and backlogs at the port, which, together with the Port of Long Beach, handles 40% of all incoming shipping containers to the U.S. Newly appointed Port Envoy John Porcari and Port of Los Angeles Executive Director Gene Seroka on Thursday shared details on the plan to shift to round-the-clock operations and other potential solutions, including that they are in talks to potentially add sites for shipping containers to be staged away from the ports.  

“We’re actively pursuing multiple ideas,” Porcari said during a digital press conference. "One of them are inland pop-up sites that can be used to ground containers on an interim basis on either public or private property. That provides some temporary help while longer-term capacity issues are addressed.”

5. SIOR: Industrial Sales to Surpass 2019 Record

Forget Musk vs. Bezos, SpaceX vs. Blue Origin and Capt. Kirk actually flying high above the stratosphere. The “massive race for space” is down on the ground in the U.S., says a new report from the Society of Industrial & Office Realtors and LightBox.

The report notes that industrial sales this year could top $120 billion (the record set in 2019), with average rents rising by 5 percent to 7 percent, or even more, and purchase prices increasing by at least that rate—all despite varied headwinds.

By mid-2021 industrial sales volume had reached almost $52 billion, and the average price per square foot had risen by nearly 25 percent year-over-year, to $120.

Your success blesses others. I wish you a great and hugely impactful week!

Power Reads: 5 Interesting Articles That Will Help You This Week

Each week, I select a few articles that rise above the fray and hopefully help you on your journey in leadership and the CRE world. They pull from one of four "corners": corporate real estate, technology, management science and anything positive. Each day we can become a better version of ourselves.

1. Manhattan office leasing up 60% in Q3

The pandemic-driven downturn in Manhattan’s office market hit an inflection point in the third quarter, with demand finally exceeding supply.

Leasing volume from July to September jumped to a total of 7.23 million square feet, up by 58.8 percent compared to the second quarter. With that, the quarterly net absorption turned positive — for the first time in two years — at 0.87 million square feet, according to Colliers International’s quarterly market report.

Franklin Wallach, Colliers’ senior managing director of research in New York, called this moment the “critical milestone” in the market’s post-pandemic recovery. But he also cautioned the market still faces a long road to recovery.

2. New Office Product Continues To Outperform Even As Sector Shifts

Despite a rise in hybrid work arrangements, the physical office is here to stay – and data captured over the course of the pandemic reveal that occupiers are choosing newer, better Class A product as they decide where to put down stakes. 

“The physical office will continue to have some role to play in the future of work,” Cushman & Wakefield economist Rebecca Rockey says in a new report outlining the future of the sector across the country. “And although there are a myriad of occupiers with vastly different needs, we know that newer, better quality office product, which usually outperforms, did so to a greater degree during the pandemic. And that trend is expected to stick.”

Historically, Class A office product has outperformed, whether during expansions or recessions or within CBD or suburban submarkets. And during prior expansions, Rockey says, Class A office product accounted for a “disproportionate amount” of absorption relative to other product types, clocking in at a growth rate of 1.7 times its share of inventory. After the Dot Com bust, Class A office accounted for 61.6% of all absorption and 35.7% of the inventory and after the Great Financial Crisis (GFC), these shares were 78.4% and 45.0% respectively, she says.

3. Boston Office Absorption Turns Positive As Lab Conversions Take Space Offline

Tech and life sciences firms flocking to Class-A office space powered Boston's office market to record its first quarter of positive absorption since the onset of the coronavirus pandemic.

The market recorded 307K SF of positive absorption in Q3 — meaning tenants took up more space than they vacated across the market — after a total of 5.5M SF of negative absorption amassed over the past six quarters, according to Colliers research. 

“The first signs of recovery are emerging,” Colliers Research Director of U.S. Capital Markets Aaron Jodka said. “Then we expect a strong Q4 largely because of the commitments that were done years ago on under-construction buildings.”

4. 6 Questions to Ask About Covid and Air Quality at Work

Whether you’ve already returned to your workplace or will be heading back to the office eventually, it’s a good idea to ask what steps your employer has taken to improve indoor air quality.

The more time we spend indoors with other people, the more likely we are to breathe each other’s exhaled air — and germs. The vast majority of scientists now agree that the coronavirus is airborne, and infectious droplets can linger in the air, float around the room or build up in spaces with poor air flow, like conference rooms.

Early in the pandemic, a coronavirus outbreak on the 11th floor of an office building in South Korea showed how just one infectious person can increase the risk for everyone in a workplace. Out of 216 people on the floor, 94 were infected. Most of the infected worked in rows of desks grouped on one side of the office.

5. Tesla To Relocate Headquarters to Austin, Texas, From California

Electric vehicle maker Tesla is moving its corporate headquarters from Palo Alto, California, to Austin, Texas, becoming just the latest West Coast company to pick a new home with no state income tax and a relatively low cost of doing business.

Tesla CEO Elon Musk made the announcement at the company's shareholder meeting Thursday in Austin, where the company is building a major $1.1 billion manufacturing plant.

Musk told shareholders that there was "a limit to how big you can scale in the Bay Area," with it being tough for people to afford homes and employees having to come into the area from far away, as reported by CNBC.

Your success blesses others. I wish you a great and hugely impactful week!

Power Reads: 5 Interesting Articles That Will Help You This Week

Each week, I select a few articles that rise above the fray and hopefully help you on your journey in leadership and the CRE world. They pull from one of four "corners": corporate real estate, technology, management science and anything positive. Each day we can become a better version of ourselves.

1. EXCLUSIVE: Carvana Subleasing Nearly 600K SF From State Farm In Atlanta

Carvana has subleased more than 550K SF of State Farm's Park Center Building 1, the 21-story, 607K SF tower overlooking Interstate 285 at the intersection of Ashford-Dunwoody Road, Bisnow has learned.

Carvana plans to start moving workers into the building on Feb. 1, a State Farm spokesperson confirmed. State Farm's employees have been operating virtually for more than 18 months, and the hybrid model has given State Farm “the experience and momentum to think differently about our facility needs,” spokesperson Roszell Gadson said in an email to Bisnow.

State Farm leases the 570K SF office component of Building 1 from a Transwestern investment fund that bought the building for $275.4M in 2017 from its original developer, KDC, according to Databank. Del Frisco's has a restaurant on the ground floor.

2. Visa To Take 123K SF At Former Norfolk Southern HQ

A financial giant is expanding its presence in Midtown Atlanta at Norfolk Southern's former headquarters.

Visa is planning to open a 123K SF office at 1200 Peachtree St., Gov. Brian Kemp's office announced Wednesday morning. Visa plans to create 1,000 jobs in the region over the next several years in the 370K SF building Cousins Properties purchased from the railway giant in 2019.

“Georgia is a growing hub for the fintech industry thanks in part to our strategic investment in workforce development initiatives,” Kemp said in a statement. “It’s always great to see a world-renowned company like Visa capitalize on the exceptional pool of diverse talent in Georgia and choose to invest in our state.”

Cousins purchased 1200 Peachtree St. for $82M after securing a deal with the railroad giant to build it a new headquarters tower off West Peachtree Street in Tech Square.

3. Cisco In Talks To Establish Huge Midtown Atlanta Office

Cisco Systems is in talks with Portman Holdings to lease approximately 80K SF at the 770K SF high-tech tower called Coda on West Peachtree Street in the heart of Georgia Tech's Tech Square, sources familiar with the negotiations tell Bisnow. The deal, if finalized, would fill most of the 100K or so SF of vacant office space at the $375M tower.

Officials with Portman and Cisco didn't respond to messages seeking comment. The company has been in conversation with Georgia Gov. Brian Kemp over the move, sources said, which is expected to bring hundreds of new tech jobs to the local economy.

Cisco could be the latest in a string of economic development wins for Atlanta, focused on the tech sector or companies opening tech hubs, including Google, Microsoft, Anthem Blue Cross Blue Shield, BlackRock, Thyssenkrupp and, in a deal announced Wednesday morning, a new Visa office, also in Midtown.

4. Why education tech startup upGrad chose Midtown for its U.S. expansion

India-based education technology startup upGrad is looking to build on the legacy of Mailchimp and other successful Midtown startups with its new Ponce City Market office. 

The startup is investing much of the $185 million it raised earlier this year into an expansion into the United States. UpGrad partners with universities to adapt graduate degrees to online formats. Georgia’s robust university system and its talent pool of former and current startup employees made Atlanta a perfect fit.  

It helps that Karan Raturi, the North American general manager, is a Georgia Institute of Technology graduate.  

“The startup journeys and stories we’ve seen in Atlanta have created this incredible pool of product engineers, business development executives or marketing executives,” Raturi said. “We can tap into that pool at a cost structure that’s favorable within the U.S.”  

5. Accounting Firm Counting On High-Profile Signage In Big Lease At 2002 Summit

A Central Perimeter-based accounting firm is crossing a major interstate to get its brand in front of more than 200,000 vehicles a day.

Aprio, formerly known as Habif, Arogeti & Wynne, inked a deal for 55K SF at 2002 Summit Blvd., a tower in the Perimeter Summit office campus off Ashford-Dunwoody Road on the Brookhaven side of Central Perimeter, CoStar reports.

Aprio plans to install its signage atop the 18-story tower, according to CoStar. The 390K SF 2002 Summit overlooks Interstate 285 where an average of 219,000 vehicles traveled daily last year, according to the Georgia Department of Transportation. The firm will move from its current headquarters at the Queen building at Concourse Corporate Center, across the interstate from Perimeter Summit.

Also known as 5 Concourse Parkway, the Queen is part of the iconic King and Queen towers in Central Perimeter.

Your success blesses others. I wish you a great and hugely impactful week!

Power Reads: 5 Interesting Articles That Will Help You This Week

Each week, I select a few articles that rise above the fray and hopefully help you on your journey in leadership and the CRE world. They pull from one of four "corners": corporate real estate, technology, management science and anything positive. Each day we can become a better version of ourselves.

1. Florida sees new COVID cases drop by 47% in the past two weeks

Florida saw a decrease of about 47% in new COVID cases in the past two weeks, the largest drop in the United States, according to a Fortune analysis of New York Times data.

It was some welcome relief for the state, which has been a COVID hotspot, with a daily average of 12,192 cases as of Sept. 15—the second highest number after Texas.

When it comes to the share of the population with COVID, Florida is now in the middle of the pack, with an average of 51.3 daily cases per 100,000 people. States such as West Virginia, Tennessee, and Kentucky are fairing far worse—averaging at or near 100 daily cases per 100,000, according to a Fortune analysis of New York Times data.

2. Why Top-Performing Companies Are More Likely to Increase Their Real Estate Footprint Post-COVID

In early summer of 2021, when we surveyed a variety of companies in the U.S., 70% of business leaders were expecting a return to the office after Labor Day weekend. We now know that was wishful thinking. The delta variant has since delayed many companies’ plans. And yet, the sentiment about the office hasn’t changed.

Even though delta changed the timeline, workers around the world still place a great deal of value in the physical workplace — and our newest data from the U.S. shows that people at the top performing companies in particular value the physical workplace and look forward to resuming in-person work.

To understand how expectations and needs around the future of work and the workplace continue to evolve, we surveyed 2,000+ U.S. leaders and knowledge workers across 10 industries in May/June 2021 to capture current sentiment around the workplace as offices begin to reopen. The survey findings offer valuable insights into what companies were planning at that time, and the continued importance of the office as a place for a range of activities.

3. Amazon Adding 125,000 Workers in U.S., Opening Dozens of Facilities

Amazon.com Inc. AMZN -0.81% said it plans to add 125,000 employees in the U.S. and has lifted its average starting wage as it continues to rapidly expand its vast warehouse operations in a tight labor market.

The tech giant on Tuesday said it has opened more than 250 facilities this year and plans to open another 100 across the country in September, deepening its pool of locations used to store, sort and ship its packages.

It said it has lifted pay for workers in such facilities to an average of $18.32 an hour as it seeks to fill those locations and replace workers who leave existing jobs. That follows a move in April to increase wages between 50 cents and $3 an hour for more than 500,000 employees.

4. U.S. Economy Shows Resilience During Delta Surge

The U.S. economy is proving resilient in the face of the Delta variant.

Americans briskly increased spending at retailers last month, while employers have largely resisted the urge to lay off workers, the government reported Thursday, both signs of strong demand in the economy.

Sales at the nation’s retailers rose 0.7% in August, rebounding from a drop in July, the Commerce Department said. With many schools, college campuses and offices reopening, consumers shelled out more for groceries and merchandise at big-box stores. Those purchases—along with higher spending on furniture and hardware—offset another big decline in car sales, which have suffered from a global computer chip-shortage that has crimped supply.

Meanwhile, initial jobless claims—a proxy for layoffs across the U.S.—rose 20,000 last week to 332,000 but remained near a pandemic low, the Labor Department said. Layoffs caused by Hurricane Ida, which hit Louisiana in late August, likely contributed to the increase, economists said.

5. Companies signing Atlanta's biggest office leases

There's a lot of uncertainty about the future of the office market.

Many companies have pulled back on initial plans to return to work. Others are downsizing from bigger offices to smaller spaces and adopting a hybrid work model.

Even so, some companies are still signing big leases.

Here are several notable office leasing deals this year, stretching from Atlanta's central business district neighborhoods to suburban cities.

Your success blesses others. I wish you a great and hugely impactful week!

Power Reads: 5 Interesting Articles That Will Help You This Week

Each week, I select a few articles that rise above the fray and hopefully help you on your journey in leadership and the CRE world. They pull from one of four "corners": corporate real estate, technology, management science and anything positive. Each day we can become a better version of ourselves.

1. Building A Workplace People Want to Come Back To

Despite how quickly the nature of work is changing, for many, there’s one point of view on physical spaces that will always hold true: the strongest interpersonal relationships are developed, well, in person. 

“It’s like sports,” said Brett Hautop, VP of Workplace for LinkedIn. “Going to a game in person is completely different than watching it on television or listening to it on the radio. It just doesn’t compare.” 

In a recent episode of WorkSpaces’ webcast series, Office Hours, Hautop joined us to discuss how companies can bridge that gap between virtual and physical as they safely emerge from the pandemic. He took us through his vision of the workplace of the future, emphasizing why in-office experiences will remain important — while unpacking the ways offices have failed workers in the past, and how a well-designed hybrid work strategy can prime them for success.

2. Morgan Stanley Raises $3.1 Billion for Global Real Estate Bets

Morgan Stanley has raised $3.1 billion for a new fund dedicated to global real estate bets, eclipsing the $2.7 billion it raised for a predecessor vehicle in 2018.

The vehicle, known as North Haven Real Estate Fund X Global LP, or ‘G10,’ garnered backing from investors including sovereign wealth funds, U.S. and international pension funds, insurers, high-net-worth individuals and family offices, John Klopp, head of global real assets for Morgan Stanley Investment Management, said in an interview. Maryland State Retirement and Pension System is among the fund’s investors, according to data compiled by Bloomberg.

“We’re playing the same tailwind sectors as the vast majority of others,” Klopp said, citing the firm’s bets on warehouse and multifamily properties. “The fundamentals are extremely strong and have been exacerbated by Covid. There’s an enormous opportunity that’s going to continue for a while in these two areas.”

3. Let’s Redefine “Productivity” for the Hybrid Era

The boundary between work and home has never been a clear line. Even when I’m in the office, for example, I’m on call if any of my four kids needs me. I remember how hard it was to get things done in my early days at Microsoft when they were babies — I had a lot of free time while they napped or played, but I couldn’t use that time productively because I might have to drop everything to attend to them at any moment.

They say necessity is the mother of invention, and as a mother and researcher, trying to manage the boundary between work and home brought a lot of invention into my life. For example, while most productivity research tends to focus on eliminating distractions, I began to imagine what we could do if we used the micro-moments we have each day productively.

This led me to develop approaches to algorithmically break tasks down into microtasks that fit more easily into the fragmented way we actually work. The resulting concept, which we call microproductivity, expanded the way we think about productivity at Microsoft.

4. Remember Todd Beamer of United 93

BRIAN BRANCH-PRICE/ASSOCIATED PRESS

My hometown is on the edge of the New York City area, where dense development ends and soybean farms begin. The 9/11 memorials around here are a reminder of our proximity to the city, but some are easy to miss. The one at the post office in nearby Cranbury is particularly inconspicuous: “This Building Is Named in Honor of Todd Beamer. ”

There’s some beauty in the humility of such a memorial. But when I learned a few years ago that Beamer had lived in the town next to mine, I was ashamed. Why hadn’t I known that this hero of 9/11 was a local guy? My region, the state of New Jersey, and the country as a whole ought to know more about Todd Beamer.

A 32-year-old software salesman for Oracle, Beamer was among the passengers on United Airlines Flight 93 who attacked the hijackers and prevented them from crashing the Boeing 757 into the U.S. Capitol. His rallying cry, “Let’s roll,” rests in America’s memory. It is exalting to think of what he and his fellow passengers did on that short flight, and the people they saved on the ground.

5. Condoleezza Rice: We Are More Secure Than We Were on 9/11

AFP VIA GETTY IMAGES

‘A plane has hit the World Trade Center,” my young assistant shouted. “What?” I asked. “Was it a small plane?” “No,” he replied. “A commercial airliner.” Within minutes there was a second plane. Then a third. America had been changed forever.

Twenty years have passed since that horrific day and nothing is the same. I remember the day after, President Bush told us that he wanted Americans to feel safe and get back to normal. We have done that, but normal is different. From the way we go through an airport to the names of institutions that we now take for granted: Homeland Security, TSA.

To this day I wonder how this could have happened. I still feel great remorse that it did.

Your success blesses others. I wish you a great and hugely impactful week!

Power Reads: 5 Interesting Articles That Will Help You This Week

Each week, I select a few articles that rise above the fray and hopefully help you on your journey in leadership and the CRE world. They pull from one of four "corners": corporate real estate, technology, management science and anything positive. Each day we can become a better version of ourselves.

1. My Years on Wall Street Showed Me Why You Can’t Make a Deal on Zoom

For all the endless bravado and gobs of money sloshing through Wall Street, at their core, banking and trading are apprenticeship businesses. They are akin to the Florentine guilds of the Renaissance, in which the subtleties and intricacies of art and science were absorbed over many years through careful observation.

In my 17 years on Wall Street advising corporate executives on restructurings, leveraged buyouts and mergers and acquisitions, I was far from God’s gift to the profession. But watching and learning from Wall Street giants such as Felix Rohatyn at Lazard and Ray McGuire at Merrill Lynch were invaluable. Sitting in their offices, I’d observe them as they romanced a potential client to win an assignment, subtly laid the groundwork to help a big shot decide whether to consummate a merger or helped negotiate the terms of a bankruptcy. I learned how the business really worked and began to understand what levers to pull to get deals done.

I was there, and I know what it’s like. So here’s my advice to you, fellow Wall Street drones: Get back to the office.

2. Exclusive survey: How the Delta variant is affecting companies' return plans

Nearly half of companies that haven’t yet returned to the office say the Covid-19 Delta variant is causing them to reconsider or scrap their return plans for now.

That was one of the big takeaways from a new survey by The Business Journals, which polled 2,404 respondents from Aug. 9-11. 

The survey largely confirmed what we reported in late July — that the rise in Covid-19 cases fueled by the Delta variant has many businesses pumping the brakes on post-Labor Day returns.

It’s a trend with high stakes not just for the businesses themselves, but for commercial real estate brokers, retailers and restaurants that are banking on a wave of employers returning to the office. 

3. Amazon Plans to Open Large Retail Locations Akin to Department Stores

Amazon.com Inc. plans to open several large physical retail locations in the U.S. that will operate akin to department stores, a step to help the tech company extend its reach in sales of clothing, household items, electronics and other areas, people familiar with the matter said.

The plan to launch large stores will mark a new expansion for the online-shopping pioneer into bricks-and-mortar retail, an area Amazon has long disrupted.

Some of the first Amazon department stores are expected to be located in Ohio and California, the people said. The new retail spaces will be around 30,000 square feet, smaller than most department stores, which typically occupy about 100,000 square feet, and will offer items from top consumer brands. The Amazon stores will dwarf many of the company’s other physical retail spaces and will have a footprint similar to scaled-down formats that Bloomingdale’s Inc., Nordstrom Inc. and other department-store chains have begun opening, the people said.

4. For Robot Trucks, Navigating Highways Is Just One Bump in the Road

The maneuvers on public roads, both short demonstration runs with no commercial cargo on board, show the potential of a technology that has drawn billions of dollars of investment. But they also show how far it has to go before it can operate safely without a human at the wheel, allowing semi trucks to haul themselves over busy interstate highways, through gnarly weather and routes lined with construction.

Most startups are pushing to achieve what is known as Level 4 automation, meaning the vehicle is capable of performing all driving functions under certain conditions. That would signal that the technology can be useful to trucking companies and shippers at commercial scale, and the startups can start earning more meaningful revenue.

In the past four months, four prominent self-driving trucking companies collectively valued at about $26 billion, including TuSimple and Plus, have rushed to tap public markets, leveraging the robust market for initial public offerings and the popularity of a vehicle known as a special-purpose acquisition company, or SPAC, in bids to raise large sums of money.

5. Why Super Commutes Aren’t Going Anywhere

Commutes longer than 90 minutes one way, also known as super commutes, are expected to stick around despite more and more professionals transitioning to remote working arrangements.

According to a new report from Apartment List, 3.1% million U.S. workers commute over 90 minutes every day. 

While the report estimates that one in three super commuters have jobs that are fully compatible with remote working arrangements, super commuters grew by 45% between 2010 and 2019, particularly in big cities like New York and Los Angeles.

With professionals migrating to the suburbs at a fast pace and companies adopting hybrid policies that require workers to come into the office at least part of the week, the report believes this could create a “new class of part-time super commuters.”

Your success blesses others. I wish you a great and hugely impactful week!

Power Reads: 5 Interesting Articles That Will Help You This Week

Each week, I select a few articles that rise above the fray and hopefully help you on your journey in leadership and the CRE world. They pull from one of four "corners": corporate real estate, technology, management science and anything positive. Each day we can become a better version of ourselves.

1. Strong Jobs Report Offers Hope for the Labor Market

Friday’s employment report revealed an improving labor market for many, as 943,000 jobs were added in July, the unemployment rate fell to 5.4% and average weekly earnings rose by 0.4% over the month. The news comes as a relief to those still waiting for the economy to return to normalcy.

Generous measures of government support have helped stabilize household finances in what would otherwise have become Depression-era conditions, given the massive loss of jobs seen in March and April of 2020. Even so, households continue to accumulate debt, although not nearly as much as might be expected had that support not been forthcoming.

Household debt grew by $313 billion in the second quarter, or by 2.1 percent, according to a report recently released by the Federal Reserve Bank of New York. While that marked the fastest rate of growth in 14 years, things might not be as dire as at first glance. In addition to higher debt burdens, outstanding household debt can grow due to population growth and inflation.

2. Pay cut: Google employees who work from home could lose money

Google employees based in the same office before the pandemic could see different changes in pay if they switch to working from home permanently, with long commuters hit harder, according to a company pay calculator seen by Reuters.

It is an experiment taking place across Silicon Valley, which often sets trends for other large employers.

Facebook (FB.O) and Twitter (TWTR.N) also cut pay for remote employees who move to less expensive areas, while smaller companies including Reddit and Zillow (ZG.O) have shifted to location-agnostic pay models, citing advantages when it comes to hiring, retention and diversity.

Alphabet Inc's (GOOGL.O) Google stands out in offering employees a calculator that allows them to see the effects of a move. But in practice, some remote employees, especially those who commute from long distances, could experience pay cuts without changing their address.

3. If you’re working while on vacation this summer, this column is for you

You know how the creep begins. An email here, a meeting there, a “Let me just deal with this now” and two hours later… your holiday is over.

This summer feels especially vulnerable to the blending of work and relaxation because that’s been the case for so much of the last year. And setting boundaries now feels really hard...to impossible. Some of us (guilty) are scheduling time away in beautiful places thinking we can do it all. Indeed, Americans plan to take an extra five days of vacation this year. One survey found that nearly two-thirds of respondents felt vacation deprived. In a global ranking, Americans took the fewest number of vacation days last year.

“The pull of inertia is challenging to overcome,” said Leah Weiss, cofounder of Skylyte, a mental-health startup. “The risk of burnout increases when we do not build structured rest into our lives.” She notes the problem predates the pandemic due to workers’ “beliefs that they can't face the workload they will be met with when they return or a conviction that they are indispensable to their teams.”

4. Class C Multifamily Properties Face Greatest Exposure As Moratoria Expire

Institutional-grade multifamily product will likely emerge from the looming end of eviction and foreclosure moratoria relatively unscathed, but Class C properties in less recovered markets are staring down greater exposure. 

That will leave some landlords in the precarious position of deciding whether to evict (and potentially draw big rent increases with new tenants) while assessing the risk of foregone rental arrears, according to a new report from Cushman & Wakefield.

“On the one hand, this means that owners will have renewed freedom of action,” writes C&W’s Kristina Garcia in the report. “On the other, were there to be a significant increase in turnover in the market as a result of increased evictions, occupancies would fall, likely resulting in a decline in rents.”

5. AMC Theatres Signals the Future of Cinemas With Plans To Add Venues, Screen More Than Movies

AMC Theatres is betting that a resurgence in Americans heading out to cinemas will accelerate as the world’s largest theater operator looks at buying real estate in Los Angeles, Chicago and Atlanta and plans to screen more sports, concerts and video-gaming events.

The number of visitors to Leawood, Kansas-based AMC Theatres across the United States tripled from the first quarter of this year as theaters reopened in major markets with vaccinations increasing and blockbusters returning such as Disney’s “Black Widow.” Rival chains including Texas-based Cinemark Theatres reported similar gains.

It's time for "AMC to be playing offense again” after more than a year of pandemic restrictions, CEO Adam Aron told analysts on a conference call to discuss its second-quarter earnings. Revenue surged to $444.7 million in the three months ended June 30 from $18.9 million in the year-earlier quarter at the height of the pandemic. Its net loss narrowed to $344 million from $561.2 million.

Your success blesses others. I wish you a great a hugely impactful week!

Power Reads: 5 Interesting Articles That Will Help You This Week

Each week, I select a few articles that rise above the fray and hopefully help you on your journey in leadership and the CRE world. They pull from one of four "corners": corporate real estate, technology, management science and anything positive. Each day we can become a better version of ourselves.

1. Returning to the office: Employees who show up in person often get ahead faster

What if people who work in an office perform better than people who work from home? What if they get promoted more quickly and receive larger, more frequent pay raises? And what if all this happens not because bosses are irrationally biased against remote workers, but because employees in the office do better work?

Haltingly, perhaps awkwardly, the working world is about to embark on a gigantic natural experiment that will test those hypotheses. Much is riding on the outcome. High-profile CEOs—notably Goldman Sachs’s David Solomon, dean of the bring-’em-back-to-the-office school, and Facebook’s Mark Zuckerberg, champion of the let-’em-stay-home faction—may be proved wise or foolish. But going in, it must be said—and many people won’t like this—that the pro-office argument has a lot going for it.

Proponents of WFH often claim that remote workers are more productive than office workers, but that’s far from clear. Some research supports the claim; other research refutes it. A Fortune survey in June found that 45% of U.S. workers who are partially or fully remote said they’re more productive at home; 55% said they’re equally (40%) or less productive (15%).

2. Commercial Real Estate Prices Have Surpassed Pre-Covid Levels

U.S. commercial real estate property values overall have surpassed their pre-pandemic rates. 

Green Street’s commercial property price index, which is determined by the net asset values of properties owned by real estate investment trusts, hit 137 last month, 1.3% above where the index sat in February 2020.

“With interest rates as low as they are, private equity shops flush with capital, and many REITs in the bidding tent as well, further price gains are expected,” Green Street co-Head of Strategic Research Peter Rothemund said in a statement.

July’s prices were up 14% up year-over-year and 2.4% higher than they were in June. Before last month, February 2020 had the highest index since at least 1998, according to Green Street. 

3. Mall Giant David Simon: ‘Physical Retail Is Here to Stay’

David Simon continues to be the ultimate brick-and-mortar believer — and is more invested than ever.

The mall giant, who leads Simon Property Group as chairman, chief executive officer and president, held court on a conference call with analysts on Monday after turning in stronger second-quarter results.

Simon said the lockdown lease fights with most retailers have died down and that the company is moving forward — shoppers are out and spending despite rising COVID-19 cases, new properties are being developed and new tenants are ready to move in.

Like the rest of fashion and the world, the real estate company is still recovering after more than a year of the coronavirus. But while brands of all shapes and sizes shift their focus to driving more digital sales, Simon is making his case for the store loud and clear.

4. U.S. Import Surge Overwhelms Warehouse Space Near Ports

Michael Lebhar/Reuters

Surging demand for warehousing close to major ports driven by the growth of e-commerce and the flood of container imports hitting U.S. shores is making storage space harder to fi nd and more expensive, adding new stresses to already strained supply chains.

Logistics service providers and real-estate firms say competition for warehouses close to ports such as those in Southern California and New York City is intense, pushing up rents and forcing companies to look to neighboring regions to serve shippers’ needs.

The pinch is most pronounced in the industrial region close to the nation’s busiest ports at Los Angeles and Long Beach. “You can literally count on your hand at best how many spaces are available in that entire region,” said Carl DeLuca, head of real estate in the Americas for DHL Supply Chain, a unit of global logistics giant Deutsche Post AG.

5. Apartment Rents Increase as Young Workers Head Back to Cities

Apartment rents are rising fast, boosted by young professionals returning to cities and an expensive housing market that keeps many of them renting.

Stock prices of publicly traded apartment companies have jumped in stride. The FTSE Nareit Equity Apartments index, which tracks these landlords, is up 42% since January, trouncing the S&P 500’s 17% gain during the same period.

Median rent has risen more than 10% over the past year $1,244, according to homesearch website Apartment List. That figure is also 9.4% above where rents stood in March 2020, right before Covid-19 lockdowns began.

Your success blesses others. I wish you a great a hugely impactful week!

Power Reads: 5 Interesting Articles That Will Help You This Week

Each week, I select a few articles that rise above the fray and hopefully help you on your journey in leadership and the CRE world. They pull from one of four "corners": corporate real estate, technology, management science and anything positive. Each day we can become a better version of ourselves.

1. Remote Work’s Last Hurrah: 6 Spots to Make Your Summer Office

Those who’ve been able to work from home over the last year have had to get creative about their workstations, setting up makeshift offices on balconies, couches or even kitchen counters. Some temporarily relocated to new cities and towns from early in the pandemic.

But a new convergence of factors in the United States — easier access to vaccinations, loosening domestic restrictions, falling coronavirus cases and good weather — has led to a golden opportunity for those tempted to take their work on the road after a year of staying put.

Remote workers who are vaccinated but are not yet required back in an office are enjoying what may be a once-in-a-lifetime window, if they’re in a privileged position to take advantage of it — to hit the road with laptops in tow, and explore the country while getting paid.

2. How to Have a Fun, Multigenerational Family Vacation

Feeling released after a terrible year, this summer many families are hitting the road or taking to the skies with three or more generations, together.

How can family vacations live up to the name, providing time to feel close but also time off the clock? Parents who had children at home for remote school for much of the last year may ache for a chance to catch their breath. Grandparents yearn to be with their families at last, without feeling as if they’re operating a day care center.

Here’s how experts in family dynamics, and some grandparents and parents, suggest to best pull that off.

3. How to Take a Post-Pandemic Road Trip

Many of us have been itching for a summer vacation after more than a year of social distancing. But even as more of us are venturing out of our homes, not everyone is ready to ditch the masks and hop on a plane to a packed resort or crowded tourist destination.

If you are considering a multiday road trip, here are our suggestions for how to plan, what to bring, and other ways to keep yourself fed, safe, and happy on your travels. 

Still can't get away? We also have recommendations on ways to stay entertained at home, with guides for our favorite phone games and gear for making beer, wine, cider, and mead. Need more of a staycation? Learn how to relax at home.

If you're vaccinated, out-of-state travel should be fine, so your destination depends on how far you're willing to go. We still recommend staying away from hot spots like Nashville or Miami, though—your first outing since quarantine ended shouldn't include standing in line for an hour outside a bar.

4. A Perfect Summer Road Trip in the Rocky Mountains

Countless monumental acts of nature roost within the Rocky Mountains.

If you’re pressed for time but eager to gorge on scenic beauty and intriguing mountain towns, we’ve devised a three-day road trip setting out from Denver and ending in Grand Junction.

A few pointers: Some of the best spots sit at the end of rocky roads; opt for four-wheel drive. Cellphone reception can’t cross over every peak; make sure your maps are printed or downloaded in advance.

This region can be highly seasonal; visit between now and the end of September before some places flip from bustling to boarded-up.

5. We All Really Need a Vacation. Here’s How to Make the Most of It.

Peter Cade/Getty Images

Even before the pandemic, millions of days of vacation time went unused in the United States. As it did with so many things, the pandemic only exacerbated the problem.

Most of us are eager for a change of scenery, and research shows that taking vacations is important for a variety of reasons. Rest and time away increases resilience, which makes people better able to deal with the inevitable setbacks at work. It provides perspective that can help people see new solutions to problems, and it gives people a chance to pursue other life goals, like spending time with family and seeing the world.

As things start approaching a new normal in many parts of the world, it’s time for a reminder not only that you need to use your vacation time, but of how to make the most of it.

Your success blesses others. I wish you a great a hugely impactful week!

Power Reads: 5 Interesting Articles That Will Help You This Week

Each week, I select a few articles that rise above the fray and hopefully help you on your journey in leadership and the CRE world. They pull from one of four "corners": corporate real estate, technology, management science and anything positive. Each day we can become a better version of ourselves.

1. Tech Workers Who Swore Off the Bay Area Are Coming Back

“It was just a hellhole living here,” said Mr. Osuri, 38, the founder and chief executive of a cloud-computing company called Akash Network. He decamped for his sister’s roomy townhouse in the suburbs of Columbus, Ohio, joining an exodus of technology workers from the crowded Bay Area.

But by March, Mr. Osuri was itching to return. He missed the serendipity of city life: meeting new people, running into acquaintances on the street and getting drinks with colleagues. “The city is full of that — opportunities that you may never have expected would come your way,” Mr. Osuri said. He moved back to San Francisco in April.

The pandemic was supposed to lead to a great tech diaspora. Freed of their offices and after-work klatches, the Bay Area’s tech workers were said to be roaming America, searching for a better life in cities like Miami and Austin, Texas — where the weather is warmer, the homes are cheaper and state income taxes don’t exist.

2. Work-From-Home May Be Efficient, But Google Says Get Back To Offices Anyway

Google

Despite reports that Google engineers believe they are as productive working at home as they used to be in the office, the tech giant is sticking with plans to bring most of its employees back to their offices much of the time.

Google wants much of its workforce, about 60%, to return to physical offices three days a week, starting in September. The matter was the subject of a memo and then an open blog post by CEO Sundar Pichai in May. 

He said in the post that 20% could work at home full time, while the other 20% could apply for a transfer to another Google office. Google is reviewing applications from employees regarding their work situations come September.

3. Wall Street’s New Rivalry: Who Can Meet the Most People in Person

Wall Street investment bankers are well-accustomed to jockeying for multimillion-dollar fees on corporate deals. Now, the game is focused on just showing up.

After more than a year of Zoom, Wall Street’s elite are beginning to emerge from behind their screens and returning to the timeworn custom of in-person client visits, handshakes and wine-soaked dinners.

Rivals Goldman Sachs Group Inc. and JPMorgan Chase & Co., which have already brought their employees back to the office faster than the rest of Wall Street, are urging their bankers to get out and visit boldfaced corporate clients —and quickly, before others do.

4. 'Safety Stock' Driving Warehouse Leasing To More Record Highs

Metro Atlanta industrial landlords are sailing toward another year of record absorption as companies increase their leasing activity.

The wind in the sails, this time, is more than just tenants building out their e-commerce delivery networks. Companies also are taking on extra storage space after the coronavirus pandemic exposed a weakness in the just-in-time delivery model that kept inventories razor thin.

“Just-in-time is a great concept, but when you have shocks to the system like we have, you also realize that lean inventories can cost you sales,” said Lisa Ward, the managing director of Atlanta-based industrial developer Core5 Industrial Partners.

5. The Reassuring Data on the Delta Variant

Martin Kozlowski

You read the same alarming headlines every few months, now with Greek letters. As the virus that causes Covid-19 evolves and mutates, the same concerns pop up about whether the variant evades vaccines, makes people sicker than the old versions, and increases transmissibility. What we know about the Delta variant is reassuring.

One of the most important questions is whether vaccines are still working well. The best way to answer that is to look at the number of vaccinated people getting serious Covid-19 symptoms or being hospitalized. A new study from the U.K. found that vaccines are still incredibly effective at preventing serious illness with the Delta variant circulating.

The Pfizer vaccine was 96% effective after two doses at preventing hospitalization, meaning the average unvaccinated person in the study was more than 25 times as likely to be hospitalized with Covid as the average vaccinated one. (This almost certainly understates the protectiveness of the vaccine, as the vaccinated cohort was older and had a higher incidence of pre-existing conditions than the unvaccinated one.) The Johnson & Johnson vaccine produces strong neutralizing antibodies and cellular responses against the Delta variant, still present eight months after administration.

Your success blesses others. I wish you a great a hugely impactful week!

Power Reads: 5 Interesting Articles That Will Help You This Week

Each week, I select a few articles that rise above the fray and hopefully help you on your journey in leadership and the CRE world. They pull from one of four "corners": corporate real estate, technology, management science and anything positive. Each day we can become a better version of ourselves.

1. Apple says in-person work is ‘essential’ and will not go back from its hybrid work plan

Earlier this month, Tim Cook announced in an internal memo that Apple is going to adopt a new hybrid work plan that will require employees to work in-person at least three days a week. While this has resulted in some controversy, the company reaffirmed that it has no plans to go back on its decision, as it considers in-person work “essential.”

In an internal video obtained by The Verge, senior VP of retail and people Deirdre O’Brien said that Apple believes that “in-person collaboration is essential to our culture and our future.” O’Brien also mentioned that the products and services introduced by Apple in the past have all been the result of in-person collaboration.

“If we take a moment to reflect on our unbelievable product launches this past year, the products and the launch execution were built upon the base of years of work that we did when we were all together in-person.”

Due to the COVID-19 pandemic, Apple had to close its offices in 2020, which resulted in more than a year of completely remote work. Now that the situation is better in the US, the company wants its employees to return to in-person work, but there’s a group of people who have taken a stand against this decision.

2. Wall Street Wants Bankers Back in the Office. Especially Gen Zers.

The life of a 20-something Wall Street number cruncher has always been a grind, marked by marathon workweeks and menial tasks. Working from home made it worse. Now bank leaders want the newbies back in the office.

While many companies are hailing the Covid work-from-home experiment as a success, top Wall Street firms such as Goldman Sachs Group Inc. and JPMorgan Chase & Co. aren’t so sure. They hope that being back in the office will cure the malaise that many of their junior bankers are feeling.

Remote work “does not work for younger people,” JPMorgan Chief Executive Officer Jamie Dimon said at The Wall Street Journal’s CEO Council Summit in May. “It doesn’t work for those who want to hustle.”

3. Virtual CRE Tours, After Mass Adoption, Face Fight For Relevance Post-Covid

When the coronavirus restrictions froze almost every aspect of dealmaking — from travel to in-person tours — the real estate industry scrambled to find alternatives to keep business going. Many of those alternatives came in the form of advanced technology, with developers, property managers and proptech firms alike plowing time and money into creating new technologies to allow clients to keep looking at assets to buy and space to rent.

As the pandemic slowly begins to recede and restrictions ease, doubts have emerged as to whether these offers will stand the test of time. Some commercial real estate players consider them a vital part of the business that is here to stay, but others think their shelf life is limited.

 “I think momentum is exponential across the board, and it’s never going back,” VTS co-founder Ryan Masiello said. “But there's going to be many people that are providing the sort of digital services that where the proof really wasn't in the pudding and that they'll sort of fade away.”

4. Here's How Much New Space Amazon Needs, And Just How Much Investors Will Pay For It

For every €1B (£860M, $1.2B) of new online sales, Amazon needs between 720K SF and 1.2M SF of new space, depending on the European country, Green Street estimated. 

Given Amazon’s European sales have risen from €100B in 2013 to more than €450B in 2020, that has meant an increase in floorspace from 100M SF to more than 300M SF in seven years.

Amazon warehouses are getting more efficient, so in future new sales won’t require as much new space, Green Street said. But it added that there are only five shopping centres in the whole of Europe that are more efficient when retail sales per SF are measured. 

This growth has created investment product that buyers are hungry to snap up. 

5. Cyberbullying Insurance Is Here. Do You Need It?

Lars Leetaru

If you’re a victim of cyberbullying, you might be entitled to compensation.

That’s the pitch insurance companies are selling to families and individuals, as cyberbullying among adults, tweens and teens becomes more common.

Insurance tech startup Waffle in May began offering stand-alone cyberprotection policies underwritten by Chubb that include cyberbullying and other cyber risks such as identity theft or extortion. The policies are intended to help victims recover costs associated with cyberbullying, such as legal fees, mental health services, tutoring to cover missed school or relocation costs if bullying was so bad that a student had to move to a new school.

“Mark my words, in five years every major insurance company will offer this,” Waffle Chief Executive Officer Quentin Coolen said.

Your success blesses others. I wish you a great a hugely impactful week!

Power Reads: 5 Interesting Articles That Will Help You This Week

Each week, I select a few articles that rise above the fray and hopefully help you on your journey in leadership and the CRE world. They pull from one of four "corners": corporate real estate, technology, management science and anything positive. Each day we can become a better version of ourselves.

1. Companies Struggle to Keep Their Tech Workers From Logging Off

JOHANNES EISELE/AGENCE FRANCE-PRESSE/GETTY IMAGES

Many information-technology workers in the U.S. are on the hunt for new jobs, seeking a wider array of remote work options, better chances for promotions and bigger paychecks, as Covid-19 restrictions ease and the economy rebounds.

That has many employers redoubling efforts to recruit and retain skilled IT workers, who were already in short supply before the coronavirus pandemic.

“Companies across all industries are struggling to secure this talent and in many cases new hires are simply replacing recent departures,” said Craig Stephenson, managing director of the North America technology officers practice at consulting firm Korn Ferry.

At the same time, demand for workers with expertise in engineering, cloud computing, data analytics and cybersecurity has never been higher, as companies retool post-pandemic operations with digital technology, Mr. Stephenson said.

2. Warehouse Rents Surge on Bidding Wars for Scarce Space

The U.S. warehouse market is starting to look like the red-hot housing sector, as companies jockey for scarce distribution space to meet surging e-commerce demand.

The competition is driving up industrial rents as retailers and logistics providers race to move goods closer to population centers, with some engaging in bidding wars for the most coveted sites. Businesses are pushing to deliver online orders faster to the homes of digital shoppers and responding to growing consumer spending that is helping drive an economic rebound.

Demand for industrial real estate is so strong that taking rents—the initial base rent agreed on by a landlord and tenant—are rising faster than asking rents, according to real-estate firm CBRE Group Inc. Industrial taking rents were up 9.7% in the first five months of 2021 compared with the same period last year, while industrial asking rents rose 7.1%, according to CBRE, which tracks 58 U.S. markets.

3. Economy Is Showing Sustained Progress, Powell Says

STEFANI REYNOLDS/BLOOMBERG NEWS

Federal Reserve Chairman Jerome Powell said Monday that job growth should pick up in coming months and temporary inflation pressures should ease as the economy continues to recover from the effects of the pandemic.

“The economy has shown sustained improvement,” Mr. Powell said in testimony prepared for delivery Tuesday on Capitol Hill, noting progress on vaccinations and vast stimulus efforts by Congress and the Fed.

Mr. Powell is set to appear before the House Subcommittee on the Coronavirus Crisis to discuss the Fed’s efforts to shore up the economy since the start of the pandemic.

4. Coworking Operators Emphasize Collaboration As They Rework Space For Return To Office

As more markets roll back pandemic-era restrictions on occupancy and more employers firm up plans for a return to the office, coworking operators are keeping up with the expectations and desires of users by updating spaces.

The alterations have evolved since the start of the pandemic. Coworking operators made early investments in air quality and HVAC systems as well as sanitation measures. But now, many users are looking for other accommodations geared more toward getting people back into the office and giving them a welcoming space suited to new work needs once they arrive. 

WeWork reported Monday that April and May were its strongest months for leasing since before the coronavirus pandemic, with gross desk sales for those two months reaching an equivalent of about 4.3M SF. 

5. Retail Is Coming Back Without Having To Make Sweeping Changes

The coronavirus pandemic has finally loosened its grip on retail, and the recovery looks a lot like a return to normalcy.

From the initial outbreak through the holiday season, it seemed as if the pandemic had accelerated pre-existing trends in retail, possibly spelling doom for long-struggling sectors. But even as online shopping has remained strong enough to drive profit explosions for the largest retailers, department stores and sit-down chain restaurants have seen meaningful growth in foot traffic in the past two months, data firm Placer.ai reports. The data comes on the heels of similar improvements from suburban shopping malls in April.

Dillard's and Kohl's have almost recovered to 2019 levels of foot traffic, and while Nordstrom and Macy's still lag behind their numbers from two years ago, they made stark improvements from February and March to May, Placer.ai reports. Though locations of Orangetheory Fitness still saw 14% less foot traffic in May of this year than in May 2019, Planet Fitness matched its May numbers from two years ago.

Your success blesses others. I wish you a great a hugely impactful week!

Power Reads: 5 Interesting Articles That Will Help You This Week

Each week, I select a few articles that rise above the fray and hopefully help you on your journey in leadership and the CRE world. They pull from one of four "corners": corporate real estate, technology, management science and anything positive. Each day we can become a better version of ourselves.

1. Attracting Talent During a Worker Shortage

shaunl/Getty Images

As of late April 2021, there were over 9 million open jobs in the U.S., a record high. Recent reports show employers across the country are scrambling for ways to fill their open requisitions. While it might sound contradictory, the U.S. is experiencing higher unemployment numbers and a labor shortage.

Conversations with our clients indicate that filling low-wage and hourly positions has been particularly a challenge. How do you attract high-quality talent in a labor market that keeps defying previously established business patterns? Here are a few areas you can start.

Briefly after the layoffs caused by the pandemic, some thought leaders expected to return to an employer’s market. In an HBR piece published a few months after the shutdowns, we cautioned against too heavily using old rules-of-thumb to predict how Covid might impact hiring outcomes and argued that the ensuing labor market would not be “like anything anyone has observed seen since the birth of modern capitalism.”

2. Hybrid Hurdles: A Partial Office Return Full Of New Complications

The hybrid office plan seeks to offer everyone flexibility. But as more firms return, it's clear this new workplace principle is causing its own hiccups.

A recent Wall Street Journal story details the cybersecurity challenges of a team of co-workers, and their devices, constantly moving between home, office and elsewhere. Lugging laptops isn’t new, but IT teams, stretched thin by the demands of switching offices to all-remote overnight, now need to make sure more seamless movements between offices work, all while updating security patches and making sure personal and corporate devices are properly sequestered.

It’s a scenario, studies show, hackers are happy to exploit. The World Economic Forum believes cyberattacks jumped 238% globally between February and April 2020.

3. Morgan Stanley chief to bankers: If you want NYC salary, you need to be in NYC

Getty Images

Morgan Stanley’s top boss issued a stern warning to his staff Monday — come back to the office by Labor Day, or face a pay cut.

“Make no mistake about it. We do our work inside Morgan Stanley offices, and that’s where we teach, that’s where our interns learn, that’s how we develop people,” Chief Executive James Gorman said during the firm’s annual U.S. Financials, Payments & CRE conference from the bank’s Midtown office, which was held virtually this year.

“If you can go into a restaurant in New York City, you can come into the office.”

Since the pandemic first started, the banking giant permitted its 70,000 employees to work from home, but with 70 percent of Big Apple adults vaccinated and an infection rate that’s not even half a percent, Gorman said it’s time for workers to get off their couches and back to their desks.

4. 'Five-day office week will become the norm again'

The five-day office week could become the norm again within two years, the Centre for Cities think tank has told the BBC.

A blend of home and office work is expected to be popular while the UK recovers from the pandemic. But some analysts then anticipate a shift back to pre-Covid working patterns for many. Currently, people who can work from home are still advised to do so. However, that is likely to change if the government ends all social distancing restrictions on 21 June.

"I expect we will see three or four days a week in the office as the UK recovers," Paul Swinney, director of policy and research at Centre for Cities, told Radio 5 Live's Wake Up to Money programme.

"Over the longer term, I'm quite hopeful that we will see people return five days a week.

5. People Are Returning to Restaurants, Stores and Hotels. But Not Yet the Office.

Office towers and nearby businesses in central business districts are missing out on the strong economic recovery, largely because the rise in vaccinations and easing of mask restrictions haven’t propelled most employees back to work.

Fewer than three out of 10 white-collar employees were working at the office on average in 10 major U.S. cities, including New York, Los Angeles, San Francisco and Washington, D.C., according to Kastle Systems. The nationwide security company monitors access-card swipes in more than 2,500 office buildings in cities across the country.

As of last week, an average of 31% of office workers had returned to the workspaces they occupied before the Covid-19 pandemic, according to Kastle.

The number of employees who are back in the office has been inching up since vaccines began rolling out in the U.S. In some cases, employees have pushed back on their employers’ requests to return. In others, companies are waiting until the fall—when vaccinations will be even more widespread and schools will be in session—to more widely reopen offices.

Your success blesses others. I wish you a great a hugely impactful week!

Power Reads: 5 Interesting Articles That Will Help You This Week

Each week, I select a few articles that rise above the fray and hopefully help you on your journey in leadership and the CRE world. They pull from one of four "corners": corporate real estate, technology, management science and anything positive. Each day we can become a better version of ourselves.

1. Sublet Space Growth Slows in New York and Other Major Cities

New York’s recovery is accelerating, with both hotel occupancy and outdoor dining picking up in May. And the rebound is expected to get help from the planned lifting of most restrictions once 70% of adults in New York state are partially vaccinated; the current rate is 69%, according to the latest federal data.

But the good news has not fully made its way to the office sector. That’s not surprising, as office usage in New York remains among the lowest in the nation, with Kastle Systems reporting that less than one in five workers are back in the office.

Still, there are some positive developments in the New York City office market. Sublet space appears to no longer be piling up. Despite increasing by about 10% in the first quarter of 2021, the amount of available sublease space has increased by less than 1% during the second quarter.

2. Are You Over Zoom Meetings, Too? Let’s Talk

iStock

Have you dumped your Zoom group yet? If not, it’s probably only a matter of time.

Our virtual social lives are drying up. Zoom, Houseparty and other platforms that were a lifeline during the Covid-19 lockdowns now feel like a chore. Virtual gatherings are harder to schedule. The limitations are getting tougher to tolerate. Even long-lost friends who reconnected during the pandemic have lost interest in video chatting.

Zoom most certainly will continue as a workplace tool, but for socializing, “I think people will be ditching Zoom in droves,” predicts Richard Slatcher, a psychology professor at the University of Georgia. As the world opens up, virtual gatherings are proving no match for ones in real life.

In an April survey of 2,000 American adults conducted a year ago by the Siena College Research Institute, 60% said they had used video chat to talk with friends and family during the prior week. In April 2021, the share had dropped to 36%, according to Jeffrey Hall, a professor of communication studies at the University of Kansas, who commissioned the two surveys.

3. The Hospitality Industry Is On Its Way Back, And Investors Are Returning As Well

Wikipedia

The coronavirus pandemic put much of the economy on ice in 2020, especially the hospitality industry, but this year a thaw began, and investors are ready to start buying hotels again.

The Hunter Hotel Investment Conference was held last week in Atlanta, attracting more than 1,100 participants, according to NewcrestImage CEO and Chairman Mehul Patel. And the mood was buoyant.

“They were all looking for investment opportunities,” he said.

Patel and NewcrestImage have already caught the mood. Earlier this year, the Grapevine, Texas-based firm, which now owns and operates about 30 hotel properties, established a hotel investment fund that Patel said will eventually swell to $100M. He has already raised $35M, and new investors keep popping up, adding about $5M to the fund each month.

That appetite is a sign that 2021 could be a big year for hotel trades. Patel said he’s optimistic that good properties will be available. Some owners will be seeking exits after enduring more than one year of hardship, while other investors see the return of summer and leisure travel as opportunities to buy in a market that is finally on the upswing. In addition, construction costs are soaring, so hotel companies that want to grow don’t have many options.

4. Cola-Cola Sets September Date for Atlanta Area Employees to Return to Headquarters

In an email sent to its workforce in the Atlanta area, Coca-Cola said its Atlanta Office Campus would be open for all employees on Sept. 7, the day after Labor Day, after being closed to most workers since the World Health Organization declared the coronavirus outbreak a global pandemic on March 11, 2020.

The beverage maker plans to reconfigure its 35-acre office complex on North Avenue near downtown Atlanta to incorporate new ways of working, according to the email from Lisa Chang, global chief people officer at Coca-Cola, and Barry Simpson, senior vice president and chief platform services officer. Coca-Cola provided a copy of the email to CoStar News.

"We are working to build our new, flexible and networked ways of working into our physical space," Chang and Simpson said. "It’s a concept called neighborhoods that will enable us to connect and collaborate more easily. We will share more about these exciting plans and the impact on your workspace and the campus in the coming weeks."

5. What Working From Home Taught Us About Our Office Setups

He has a second set of the exact same lighting devices at his home office in Tenafly, N.J., where he still works one or two days a week. “Two pairs of everything” is his motto today. Another pandemic-era work habit that stuck with him is switching from old-school pen and paper to an iPad app called GoodNotes. It got hard to keep track of notebooks in his house, since he used to break up his workday to spend time with his 3-year-old son.

“I’d say my workflow is way better and more streamlined now,” he says.

Across the country, workers are re-evaluating their work-from-home setups as conventional offices slowly reopen. Some, like Mr. Marans, are bringing elements of the home offices that they perfected during the pandemic back with them. Others are paring down their domestic workspaces now that remote work is more quotidian instead of the special occasion it became last spring.

Carole Ingber, a New York City talent agent, says that the pandemic inspired her to deal with a chaotic pileup of paperwork that had taken over her professional life. Last spring, when she schlepped all those materials home to continue her job remotely, she became overwhelmed and hired a professional organizer. She then invested in hanging folders, a filing drawer, a dedicated spot to drop mail and a stationery container.

Your success blesses others. I wish you a great a hugely impactful week!