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General Category => General Discussion => Topic started by: Cardboard on November 17, 2020, 07:16:46 PM

Title: Leaving New York City
Post by: Cardboard on November 17, 2020, 07:16:46 PM
https://nypost.com/2020/11/14/new-stats-reveal-massive-nyc-exodus-amid-coronavirus-crime/

Cardboard
Title: Re: Leaving New York City
Post by: clutch on November 17, 2020, 07:27:02 PM
They will come back... NYC is still the capital of the world.
But my guess is when they get a Republican mayor again.  ;D
Title: Re: Leaving New York City
Post by: BG2008 on November 17, 2020, 08:06:47 PM
I got a sizable bet that people will return.  My balls are on the line.  These articles are never easy to process.  But you don't really get paid for buying at a 3.5% cap rate of a "blue sky" NOI.
Title: Re: Leaving New York City
Post by: fareastwarriors on November 17, 2020, 11:17:01 PM
Is New York City Over? (Ep. 434)

https://freakonomics.com/podcast/urban-flight-part-1/
Title: Re: Leaving New York City
Post by: sleepydragon on November 18, 2020, 04:54:51 AM
NYC has too much tax! So people have been moving to nearby suburbs and Covid-19 accelerated it.
And they tax out of state residents as NYC residents if they keep an apt there.

Title: Re: Leaving New York City
Post by: cherzeca on November 18, 2020, 06:34:57 AM
NYCer for 40 yers here.  raised two kids here. talking to them I get a feel for how young adults feel about NYC.  before covid, they all loved it. after covid, "why spend this much if I am just zooming all day"? your next gen of office workers are not feeling NYC.  there are excellent coffee shops elsewhere too...
Title: Re: Leaving New York City
Post by: stahleyp on November 18, 2020, 06:58:44 AM
Unless there is (another) government bailout of NYC, wouldn't the taxes just continue to increase on the remaining population? I mean, a lot of this stuff is fixed, right? It would kind of create a pretty vicious cycle.``````````````````````````
Title: Re: Leaving New York City
Post by: HJ on November 18, 2020, 07:08:44 AM
A lot depends on how it's managed going forward.  Presumably there were good structural reasons for NYC to have become NYC, capital of the world, in the first place, be it institutional or geographical.  Some of those reasons are impaired by the aftermath of pandemic, some are not.  But clearly the short term is looking quite grim.  Whether it go on for a couple of years or a couple of decades depends on how it's  managed and how US interact with the world.  Longer term, presumably those same advantages that created NYC in the first place will resurrect it, the same way they did after the 70's.
Title: Re: Leaving New York City
Post by: Castanza on November 18, 2020, 07:17:46 AM
NYC has been through worse in the past (GD tent city in central park) and will probably go through more troubled times in the future. People who get fed up with taxes will leave, and people who have big ambitions and no experience paying high taxes will gladly move in and take a shot at hitting it big in the Big Apple.

For every person trying to escape a big city there is someone trying to escape their small town.
Title: Re: Leaving New York City
Post by: thepupil on November 18, 2020, 07:28:30 AM
I've personally sold all my NYC focused REITs and purchased a boutique hotel in Belgrade, as it's the future.

https://nypost.com/2020/11/17/serbia-is-a-new-unlikely-oasis-for-nyc-residents-fleeing-the-city/
Title: Re: Leaving New York City
Post by: Liberty on November 18, 2020, 07:31:20 AM
Who knew people prefer larger living quarters when they can't go out much, and smaller ones when they can go out a lot?

Life is trade-offs, I guess.
Title: Re: Leaving New York City
Post by: BG2008 on November 18, 2020, 07:31:48 AM
I've personally sold all my NYC focused REITs and purchased a boutique hotel in Belgrade, as it's the future.

https://nypost.com/2020/11/17/serbia-is-a-new-unlikely-oasis-for-nyc-residents-fleeing-the-city/

How much NYC office do you still own?  This is what makes a market. 
Title: Re: Leaving New York City
Post by: BG2008 on November 18, 2020, 07:35:27 AM
Who knew people prefer larger living quarters when they can't go out much, and smaller ones when they can go out a lot?

Life is trade-offs, I guess.

So you mean to tell me that if there was a virus that is very contagious and it make people want to leave densely populated cities with high rent, I am supposed to be shocked at that kind of rationale behavior by the upper middle to rich class?   

Wow, I would've never thought of that.  2008/2009 was scary as well.  People tried to jack my tenants.  Every 7-10 years, you have to experience some pain in real estate.  It's just life.  This is round 2 for me with 2008/2009 being more scary in general but NYC holding up better.  This round is more specific for NYC.  Back in 2008/2009, I was pretty bearish about NYC because all the revenue and profit center that drove that boom was so tied to mortgage packaging.  That was totally going to go away.
Title: Re: Leaving New York City
Post by: cherzeca on November 18, 2020, 08:03:43 AM
Unless there is (another) government bailout of NYC, wouldn't the taxes just continue to increase on the remaining population? I mean, a lot of this stuff is fixed, right? It would kind of create a pretty vicious cycle.``````````````````````````

there is grittiness and there is unsafe.  former is kinda of urban cool, latter is uncool.  NYC is managing itself into uncoolness for your next Gen office workers.  seems like other cities are following suit
Title: Re: Leaving New York City
Post by: thepupil on November 18, 2020, 08:27:37 AM
I've personally sold all my NYC focused REITs and purchased a boutique hotel in Belgrade, as it's the future.

https://nypost.com/2020/11/17/serbia-is-a-new-unlikely-oasis-for-nyc-residents-fleeing-the-city/

How much NYC office do you still own?  This is what makes a market.

low teens % of portfolio and dropping.

Title: Re: Leaving New York City
Post by: Liberty on November 18, 2020, 08:33:50 AM
Who knew people prefer larger living quarters when they can't go out much, and smaller ones when they can go out a lot?

Life is trade-offs, I guess.

So you mean to tell me that if there was a virus that is very contagious and it make people want to leave densely populated cities with high rent, I am supposed to be shocked at that kind of rationale behavior by the upper middle to rich class?   

Wow, I would've never thought of that.  2008/2009 was scary as well.  People tried to jack my tenants.  Every 7-10 years, you have to experience some pain in real estate.  It's just life.  This is round 2 for me with 2008/2009 being more scary in general but NYC holding up better.  This round is more specific for NYC.  Back in 2008/2009, I was pretty bearish about NYC because all the revenue and profit center that drove that boom was so tied to mortgage packaging.  That was totally going to go away.

I know, right.
Title: Re: Leaving New York City
Post by: cherzeca on November 18, 2020, 08:49:46 AM
Who knew people prefer larger living quarters when they can't go out much, and smaller ones when they can go out a lot?

Life is trade-offs, I guess.

So you mean to tell me that if there was a virus that is very contagious and it make people want to leave densely populated cities with high rent, I am supposed to be shocked at that kind of rationale behavior by the upper middle to rich class?   

Wow, I would've never thought of that.  2008/2009 was scary as well.  People tried to jack my tenants.  Every 7-10 years, you have to experience some pain in real estate.  It's just life.  This is round 2 for me with 2008/2009 being more scary in general but NYC holding up better.  This round is more specific for NYC.  Back in 2008/2009, I was pretty bearish about NYC because all the revenue and profit center that drove that boom was so tied to mortgage packaging.  That was totally going to go away.

covid is precipitating trends that are not friendly to NYC.  the biggest in my mind is the risk that "front office" as well as "back office" of the securities/finance industry will leave NYC.  the latter has already mostly happened. covid is encouraging the former.  if NYC loses much of the financial sector, then it will be shot to hell
Title: Re: Leaving New York City
Post by: BG2008 on November 18, 2020, 09:05:26 AM
I've personally sold all my NYC focused REITs and purchased a boutique hotel in Belgrade, as it's the future.

https://nypost.com/2020/11/17/serbia-is-a-new-unlikely-oasis-for-nyc-residents-fleeing-the-city/

How much NYC office do you still own?  This is what makes a market.

low teens % of portfolio and dropping.

What was it at peak and how do you typically size?
Title: Re: Leaving New York City
Post by: BG2008 on November 18, 2020, 09:11:44 AM
Who knew people prefer larger living quarters when they can't go out much, and smaller ones when they can go out a lot?

Life is trade-offs, I guess.

So you mean to tell me that if there was a virus that is very contagious and it make people want to leave densely populated cities with high rent, I am supposed to be shocked at that kind of rationale behavior by the upper middle to rich class?   

Wow, I would've never thought of that.  2008/2009 was scary as well.  People tried to jack my tenants.  Every 7-10 years, you have to experience some pain in real estate.  It's just life.  This is round 2 for me with 2008/2009 being more scary in general but NYC holding up better.  This round is more specific for NYC.  Back in 2008/2009, I was pretty bearish about NYC because all the revenue and profit center that drove that boom was so tied to mortgage packaging.  That was totally going to go away.

covid is precipitating trends that are not friendly to NYC.  the biggest in my mind is the risk that "front office" as well as "back office" of the securities/finance industry will leave NYC.  the latter has already mostly happened. covid is encouraging the former.  if NYC loses much of the financial sector, then it will be shot to hell

I don't have a lot of numbers or stats to back up.  I guess I am one of those HODL NYC people.  FB signed the Farley building while simultaneously laying out a plan to have 50% of the work force remote in 10 years.  My interpretation is that FB and the other big tech companies realize that NYC will likely be the best source for the 22-35 talent.   It wasn't that long ago when corporations were complaining that they can't compete on hiring in the suburbs.   

New normal probably looks like "35+ married with kids moves to the burbs earlier" because companies are willing to accommodate work from home or at least partially.  This provides a place for the younger 22-35 single and ready to mingle to flood into the city.  There were concerns a while ago that NYC was getting unaffordable and the young blood were priced out.  I think this is a great reset.  Those young'uns want to be near where the ACTION is which includes career prospect and mates.  Living in NYC never made sense for the parents helping out their kids etc.   But it is glorious for the kids. 

Willing to go long NYC.  There are still bargains.

In the ZIRP, the 6% dividend yield is KING (or likely to double).
Title: Re: Leaving New York City
Post by: fareastwarriors on November 18, 2020, 09:19:55 AM
I've personally sold all my NYC focused REITs and purchased a boutique hotel in Belgrade, as it's the future.

https://nypost.com/2020/11/17/serbia-is-a-new-unlikely-oasis-for-nyc-residents-fleeing-the-city/

How much NYC office do you still own?  This is what makes a market.

low teens % of portfolio and dropping.

What was it at peak and how do you typically size?

Pupil and Gregmal trimming their office REITs... Uh oh...

Run, don't walk! 
Title: Re: Leaving New York City
Post by: HJ on November 18, 2020, 09:43:35 AM
Who knew people prefer larger living quarters when they can't go out much, and smaller ones when they can go out a lot?

Life is trade-offs, I guess.

So you mean to tell me that if there was a virus that is very contagious and it make people want to leave densely populated cities with high rent, I am supposed to be shocked at that kind of rationale behavior by the upper middle to rich class?   

Wow, I would've never thought of that.  2008/2009 was scary as well.  People tried to jack my tenants.  Every 7-10 years, you have to experience some pain in real estate.  It's just life.  This is round 2 for me with 2008/2009 being more scary in general but NYC holding up better.  This round is more specific for NYC.  Back in 2008/2009, I was pretty bearish about NYC because all the revenue and profit center that drove that boom was so tied to mortgage packaging.  That was totally going to go away.

covid is precipitating trends that are not friendly to NYC.  the biggest in my mind is the risk that "front office" as well as "back office" of the securities/finance industry will leave NYC.  the latter has already mostly happened. covid is encouraging the former.  if NYC loses much of the financial sector, then it will be shot to hell

NYC lost the Madison Avenue advertising businesses, (think Mad Man), and it was once the fashion capital of US with its garment district, and the media center of the US with all big 3 broadcasters.  Finance is obviously hugely important to NYC today, but there are fundamental forces that give NYC its regenerative capacity.  Geography, for one, makes immigration benefit NY more than elsewhere in the US, and so are the transportation infrastructure, education institutions, etc.  There's reason why finance was centered around NY in the first place. 

That said, it's going to be on a down hill for a while, especially with characters like AOC having influence over decisions surrounding Amazon HQ2.  It'll take a while, but it's more about how it's run that will determine its future than just finance.
Title: Re: Leaving New York City
Post by: Gregmal on November 18, 2020, 09:52:20 AM
I've personally sold all my NYC focused REITs and purchased a boutique hotel in Belgrade, as it's the future.

https://nypost.com/2020/11/17/serbia-is-a-new-unlikely-oasis-for-nyc-residents-fleeing-the-city/

How much NYC office do you still own?  This is what makes a market.

low teens % of portfolio and dropping.

What was it at peak and how do you typically size?

Pupil and Gregmal trimming their office REITs... Uh oh...

Run, don't walk!

To be fair, I have, over the past few months come across one of the most exciting invest opportunities Ive seen in a long time, and its not in the real estate space. Given my massive real estate exposure, my incentive to reallocate to a new and somewhat diversifying core position is large.
Title: Re: Leaving New York City
Post by: Jurgis on November 18, 2020, 10:48:06 AM
I've personally sold all my NYC focused REITs and purchased a boutique hotel in Belgrade, as it's the future.

https://nypost.com/2020/11/17/serbia-is-a-new-unlikely-oasis-for-nyc-residents-fleeing-the-city/

You're my kind of guy. Can you buy me a houseboat in Belgrade?

(https://www.vyperlook.com/wp-content/uploads/2012/03/Shut-up-and-take-my-money.jpg)
Title: Re: Leaving New York City
Post by: BG2008 on November 18, 2020, 11:12:36 AM
Who knew people prefer larger living quarters when they can't go out much, and smaller ones when they can go out a lot?

Life is trade-offs, I guess.

So you mean to tell me that if there was a virus that is very contagious and it make people want to leave densely populated cities with high rent, I am supposed to be shocked at that kind of rationale behavior by the upper middle to rich class?   

Wow, I would've never thought of that.  2008/2009 was scary as well.  People tried to jack my tenants.  Every 7-10 years, you have to experience some pain in real estate.  It's just life.  This is round 2 for me with 2008/2009 being more scary in general but NYC holding up better.  This round is more specific for NYC.  Back in 2008/2009, I was pretty bearish about NYC because all the revenue and profit center that drove that boom was so tied to mortgage packaging.  That was totally going to go away.

covid is precipitating trends that are not friendly to NYC.  the biggest in my mind is the risk that "front office" as well as "back office" of the securities/finance industry will leave NYC.  the latter has already mostly happened. covid is encouraging the former.  if NYC loses much of the financial sector, then it will be shot to hell

NYC lost the Madison Avenue advertising businesses, (think Mad Man), and it was once the fashion capital of US with its garment district, and the media center of the US with all big 3 broadcasters.  Finance is obviously hugely important to NYC today, but there are fundamental forces that give NYC its regenerative capacity.  Geography, for one, makes immigration benefit NY more than elsewhere in the US, and so are the transportation infrastructure, education institutions, etc.  There's reason why finance was centered around NY in the first place. 

That said, it's going to be on a down hill for a while, especially with characters like AOC having influence over decisions surrounding Amazon HQ2.  It'll take a while, but it's more about how it's run that will determine its future than just finance.


Why don't people talk about biology?  Why don't people talk about the fact that if you are 22-35, single, horny, and promising, you want to be in NYC to meet others just like you.  If you are 25, Asian (East and South), and can code or build complex financial models or just trying to revolutionize the world, you want to be here.  Your odds are slimmer in Wichita.  If you are LGBTQ, this is a great place for you.  If you want Dim Sum, this is the place for you (although capacity leaving the market temporarily).  50% of my thesis is that this is the deepest liquidity pool for dating.  I will continue to bet on biology. 
Title: Re: Leaving New York City
Post by: thepupil on November 18, 2020, 11:29:17 AM
not to mention the pricing from a consumer standpoint is starting to get super attractive in my view:

https://streeteasy.com/building/360-east-57-street-new_york/10b

this apartment (well one a few floors up or down) was $5100 when i lived there in the early 2010's. it's now $4200. rent down 20% from almost 10 years ago, while salaries/all-in comp for elite fields is probably up 20% (or more in some instances, I'm honestly not as in tune with entry level comp for banking/consulting/tech)

the living room can be a 3rd bedroom, that's $1,400 / month average for 3 dudes to live in manhattan making like mid $100's 1st year out of college (finance/tech/whatever), or $2000/month for recently graduated big law types making $250K (you get your own bathroom and a full living room for having to deal with law school). i'm sure this apartment is not the cheapest/most expensive, i just picked this one because i have a great sense of comparability and know what it's like to actually live there (it's nice, doorman building, perfectly acceptable). it's not a hip spot, the neighborhood's kind of boring, but you're a walk away from the offices in midtown and a wasted cab ride away from lots of night life.

people make a lot more today than in the early 2010's, the disposable income of the yuppie crowd. rents down = massive increase in disposable income for playing and getting ahead in the greatest city in the world and that applies at all levels.

think how cheap its getting to share apartments in outer boroughs. sure that's bad for near term NOI, but it also creates an attractive pull.  you can say "well ya but you could get a house or your own apartment for that in XXX", sure, but it's not in NYC.

rents are skyrocketing in the places people are leaving to. like in south Florida for example.

the NYC premium collapsing should help buffer the "exodus"

EDIT: for context, the 2BR I shared in the south immediately after my time in NYC is now $2000 up from $1500. So the spread went from $3,700/month to $2,200/month.
Title: Re: Leaving New York City
Post by: mattee2264 on November 18, 2020, 02:44:40 PM

 If there is any doubt that NYC isn't still a very big deal just look at the market reaction when NYC closed the schools. All the other tightening restrictions barely moved the needle.
Title: Re: Leaving New York City
Post by: rb on November 18, 2020, 04:54:57 PM
I've personally sold all my NYC focused REITs and purchased a boutique hotel in Belgrade, as it's the future.

https://nypost.com/2020/11/17/serbia-is-a-new-unlikely-oasis-for-nyc-residents-fleeing-the-city/
If I recall correctly for the 08/09 cycle Buenos Aires had that particular distinction. Too bad you didn't buy a boutique hotel there. But I see you're learning. You are the pupil after all  :D.
Title: Re: Leaving New York City
Post by: TwoCitiesCapital on November 18, 2020, 05:04:14 PM
All this talk of the end of NYC is hilarious. Y'all might have a case of COVID can't be solved and population density is forever a threat, but in the event of actual vaccines and or herd immunity, NYC is back in business in 2-3 years.

High paying jobs are still there. Bars/restaurants/nightlife/entertainment is still there and unparalleled in most cities.

Covid throws a kink in that - no one wants to pay 4k/month for a 600 sq ft apartment you can't leave - especially if you can work remotely - but ultimately the solving of COVID will solve that and people will go back to paying 4k/month for apartments just to sleep in again.

Disclosure: lived in NYC for 7 years and left in 2017
Title: Re: Leaving New York City
Post by: merkhet on November 20, 2020, 05:06:52 AM
Why don't people talk about biology?  Why don't people talk about the fact that if you are 22-35, single, horny, and promising, you want to be in NYC to meet others just like you.  If you are 25, Asian (East and South), and can code or build complex financial models or just trying to revolutionize the world, you want to be here.  Your odds are slimmer in Wichita.  If you are LGBTQ, this is a great place for you.  If you want Dim Sum, this is the place for you (although capacity leaving the market temporarily).  50% of my thesis is that this is the deepest liquidity pool for dating.  I will continue to bet on biology.

not to mention the pricing from a consumer standpoint is starting to get super attractive in my view:

https://streeteasy.com/building/360-east-57-street-new_york/10b

this apartment (well one a few floors up or down) was $5100 when i lived there in the early 2010's. it's now $4200. rent down 20% from almost 10 years ago, while salaries/all-in comp for elite fields is probably up 20% (or more in some instances, I'm honestly not as in tune with entry level comp for banking/consulting/tech)

the living room can be a 3rd bedroom, that's $1,400 / month average for 3 dudes to live in manhattan making like mid $100's 1st year out of college (finance/tech/whatever), or $2000/month for recently graduated big law types making $250K (you get your own bathroom and a full living room for having to deal with law school). i'm sure this apartment is not the cheapest/most expensive, i just picked this one because i have a great sense of comparability and know what it's like to actually live there (it's nice, doorman building, perfectly acceptable). it's not a hip spot, the neighborhood's kind of boring, but you're a walk away from the offices in midtown and a wasted cab ride away from lots of night life.

people make a lot more today than in the early 2010's, the disposable income of the yuppie crowd. rents down = massive increase in disposable income for playing and getting ahead in the greatest city in the world and that applies at all levels.

think how cheap its getting to share apartments in outer boroughs. sure that's bad for near term NOI, but it also creates an attractive pull.  you can say "well ya but you could get a house or your own apartment for that in XXX", sure, but it's not in NYC.

rents are skyrocketing in the places people are leaving to. like in south Florida for example.

the NYC premium collapsing should help buffer the "exodus"

EDIT: for context, the 2BR I shared in the south immediately after my time in NYC is now $2000 up from $1500. So the spread went from $3,700/month to $2,200/month.


+1 to both -- if you're a young and single person, you will almost certainly be back in NYC in a few years regardless of whether you can do your work from Des Moines -- because then you would have to live in Des Moines.

thepupil inspired me to take a look at my old apartment in NYC. https://bit.ly/2IMTBJ8

The gross rent is maybe two hundred bucks north of where it was when I moved to NYC in 2007. As a 24 year old newly minted lawyer, I was more than happy to apply part of my $160k salary (now $190k for anyone starting NYC Biglaw) to a nice crib. Y'all are crazy if you think people won't want to live in NYC again.
Title: Re: Leaving New York City
Post by: cubsfan on November 20, 2020, 05:19:34 AM
^ Damn Merkhet, you were living large!  Somehow I never envisioned you living in Des Moines anyway!
Title: Re: Leaving New York City
Post by: SharperDingaan on November 20, 2020, 06:08:57 AM
Living in NYC is no different to living in a London, Paris, Milan, Sydney,  Barcelona, etc.
If you are a young person and shopping for a mate, this is where you want to be .... but it's a limited term engagement (6-7 yrs at most). You are also a big chunk of the annual churn - once you've decided to settle down you're renting in the burbs, 'cause kids are expensive!

If most WFH and zoom all day - both the opportunities and the pool of potential mates in NYC just crashed.
F*** It!, live in the burbs, travel to NYC on the weekend, and just rent a room in the DT on saturday night. Hotels are hurting, deals are abundant, and you look 'smart'. Not paying inflated rents, no car to maintain, discretionary cashflow, yada, yada. Common practice.

6-7 years? Graduate at 24/25 with a masters/designation, if the family hasn't started by 30/31 it isn't going to.
Better get to it - 'cause the clock is ticking!

Does it come back? Sure, but anyone's guess as to when
Is it cheap? Compared to what, and is the comparative relevant

SD



Title: Re: Leaving New York City
Post by: cherzeca on November 20, 2020, 08:07:17 AM
Des Moines may not be the best comparison to NYC (LOL)...though I have visited it on work, and it was rather pleasant...except for the weather.

how about Atlanta? Nashville? Austin? Boston? Denver?

know personally a young couple who got a 3 bedroom in Atlanta overlooking Piedmont Park for $1K/month less than their prior 2 bedroom in NYC (chelsea).

NYC is not going anywhere (one of the attractions of investing in RE is that it doesn't go anywhere), but I see it losing its financial services industry dominance, and that is an important driver of NYC wealth.  OTOH, I do see a lot of life sciences buildings going up in NYC (albeit in marginal neighborhoods), which is an important trend to follow.  so net net, I see NYC becoming more like boston in terms of the strength of its financial services industry (and perhaps even approaching boston's academic/research strength), but a NYC that looks more like boston is not NYC...
Title: Re: Leaving New York City
Post by: merkhet on November 20, 2020, 11:44:19 AM
^ Damn Merkhet, you were living large!  Somehow I never envisioned you living in Des Moines anyway!

Haha, 24 year old me made... interesting... choices. My last apartment before leaving NYC was a block away from Union Square because it allowed me to easily stumble home drunk @ 3am. Also, it was next to a number of bars, and I could easily bounce someone from the bar to my apartment. (“My apartment is just a few doors down.”) 😁

Des Moines may not be the best comparison to NYC (LOL)...though I have visited it on work, and it was rather pleasant...except for the weather.

how about Atlanta? Nashville? Austin? Boston? Denver?

know personally a young couple who got a 3 bedroom in Atlanta overlooking Piedmont Park for $1K/month less than their prior 2 bedroom in NYC (chelsea).

NYC is not going anywhere (one of the attractions of investing in RE is that it doesn't go anywhere), but I see it losing its financial services industry dominance, and that is an important driver of NYC wealth.  OTOH, I do see a lot of life sciences buildings going up in NYC (albeit in marginal neighborhoods), which is an important trend to follow.  so net net, I see NYC becoming more like boston in terms of the strength of its financial services industry (and perhaps even approaching boston's academic/research strength), but a NYC that looks more like boston is not NYC...

Fair enough! I would say that even compared to Austin (or even Dallas, where I live now) there’s a huge gap in terms of things to do, cultural aspects, etc. The fact that there’s only a $1k/month difference between Atlanta & Chelsea is probably bullish NYC IMO.

But, of course, this is all dependent on life stage! 37 year old me has a wife and a kid, so Dallas is great!
Title: Re: Leaving New York City
Post by: Nomad on November 20, 2020, 01:31:11 PM
It's interesting to see the narratives pop up in this thread about NYC either becoming the next Mogadishu or coming back better than ever due to horny young singles, fancy jobs, etc. More than any other city, New York seems to emit a reality distortion field that causes people to either love it or hope that it burns to the ground. Having lived in NYC, I certainly think that many people are too emotionally invested in the place. It seems like a lot of people draw some strange Outer Scorecard type of satisfaction and feeling of superiority from living or working in NYC.

All that aside, from a real estate standpoint, I would be very hesitant to touch anything in New York right now, especially at the cap rates on offer. The expression "cheap for a reason" comes immediately to mind. Even before Covid, the population of NYC was going down, not up. Don't believe me? Look it up yourself. NYC has been losing people for the last several years, and the population decline has been slowed only by the level of international in-migration. American-born residents are moving OUT of the city on a net basis, and have been for many years: https://www1.nyc.gov/assets/planning/download/pdf/planning-level/nyc-population/new-population/current-populatiion-estimattes.pdf

Now, maybe this trend reverses and American citizens start moving back in droves due to cheaper rent, perceived "coolness," etc. Or maybe immigrants start flowing in again. Maybe I'm completely wrong and missing the investment opportunity of a lifetime. All I am saying is that NYC as an investment thesis is in my "too hard" pile. It's not unprecedented for a city to fall and never recover. Look at Detroit - once one of the gems of the United States - which has never returned to its former glory.
Title: Re: Leaving New York City
Post by: BG2008 on November 20, 2020, 08:57:05 PM
Why don't people talk about biology?  Why don't people talk about the fact that if you are 22-35, single, horny, and promising, you want to be in NYC to meet others just like you.  If you are 25, Asian (East and South), and can code or build complex financial models or just trying to revolutionize the world, you want to be here.  Your odds are slimmer in Wichita.  If you are LGBTQ, this is a great place for you.  If you want Dim Sum, this is the place for you (although capacity leaving the market temporarily).  50% of my thesis is that this is the deepest liquidity pool for dating.  I will continue to bet on biology.

not to mention the pricing from a consumer standpoint is starting to get super attractive in my view:

https://streeteasy.com/building/360-east-57-street-new_york/10b

this apartment (well one a few floors up or down) was $5100 when i lived there in the early 2010's. it's now $4200. rent down 20% from almost 10 years ago, while salaries/all-in comp for elite fields is probably up 20% (or more in some instances, I'm honestly not as in tune with entry level comp for banking/consulting/tech)

the living room can be a 3rd bedroom, that's $1,400 / month average for 3 dudes to live in manhattan making like mid $100's 1st year out of college (finance/tech/whatever), or $2000/month for recently graduated big law types making $250K (you get your own bathroom and a full living room for having to deal with law school). i'm sure this apartment is not the cheapest/most expensive, i just picked this one because i have a great sense of comparability and know what it's like to actually live there (it's nice, doorman building, perfectly acceptable). it's not a hip spot, the neighborhood's kind of boring, but you're a walk away from the offices in midtown and a wasted cab ride away from lots of night life.

people make a lot more today than in the early 2010's, the disposable income of the yuppie crowd. rents down = massive increase in disposable income for playing and getting ahead in the greatest city in the world and that applies at all levels.

think how cheap its getting to share apartments in outer boroughs. sure that's bad for near term NOI, but it also creates an attractive pull.  you can say "well ya but you could get a house or your own apartment for that in XXX", sure, but it's not in NYC.

rents are skyrocketing in the places people are leaving to. like in south Florida for example.

the NYC premium collapsing should help buffer the "exodus"

EDIT: for context, the 2BR I shared in the south immediately after my time in NYC is now $2000 up from $1500. So the spread went from $3,700/month to $2,200/month.


+1 to both -- if you're a young and single person, you will almost certainly be back in NYC in a few years regardless of whether you can do your work from Des Moines -- because then you would have to live in Des Moines.

thepupil inspired me to take a look at my old apartment in NYC. https://bit.ly/2IMTBJ8

The gross rent is maybe two hundred bucks north of where it was when I moved to NYC in 2007. As a 24 year old newly minted lawyer, I was more than happy to apply part of my $160k salary (now $190k for anyone starting NYC Biglaw) to a nice crib. Y'all are crazy if you think people won't want to live in NYC again.

Merkhet and Pupil,

You guys lived in way too fancy digs for me.  I was living on 9th Ave between 55th and 56th or maybe 54th and 55th.  It was a fourth floor walk up (European floors, so it was really 5th).  The place was a dump.  It was a long rectangular one bedroom where the bedroom is on one side and the living room is on the other side.  I was first subletting from a gay guy who taught ballet.  Then rent got too expensive for him.  I moved back to Queens.  Then I talked to the landlord and he let me rent the whole apartment.  I then sublet the place and posted an ad on Craigslist.  30 people showed up all ready to give me first month rent.  It was literally a reality show.  This was a shit apartment on 9th Ave and 50s in Hell's Kitchen near a row of restaurants.  But the rent was $1,900 and we can split it between 2 people and it functions like 2 separate studios on 2 opposite ends.  I first rented it to a female Cornell grad and I quickly realize I was becoming her relationship therapist and she quickly wanted out of the deal.  I was annoyed because I passed on an Apple tech guy in his late 30s because I wanted to live with someone younger.  I probably could've gotten it rented in 2 weeks.  But I was working IB hours and I had the girl's deposit.  So I took my time and ran another open house.  30 people showed up again.  People who work in the theater district, girls who were going to the Alvin Alley dance studios, finance people, and generally people making $50-100k who need a cheap place that was convenient.  I worked on 7th Ave and could just walk over to work without getting on any subways.  I used to ride my road bike in Central Park in the morning or go up the west side highway and go over the GW bridge to Jersey on the weekends.  I would carry my road bike up 5 flights of stairs while strapped to my bike shoes which is probably not smart.  Everyone wanted to sublet.  I winded up subletting to an African American man in his mid 20s who was working at a middle office job at JP Morgan.  So, in my short time, I had a gay Asian American roommate who taught ballet, an Asian American woman who couldn't get over her ex, and an African American man as roommate in a matter or 2 years. 

How bad was the place.  Paint was falling off the ceiling.  The tub needs a mat or it didn't drain well.  The place was old.  The doors to my bedroom didn't go all the way up or down.  My roommates' ceiling was falling off.  But did it matter?  A few things stood out.  I once somehow bought home 3 different girls in one week.  I peaked that week.  I also once convince a girl living in Delaware to board an Amtrak train to come to Penn Station at 7PM.  So she got ready at 7PM and arrived in NYC at midnight and we went out and had a great time.  My apartment was gross and she knew.  But she was coming to go out in New York city where you can stay out till 4AM.  My African American roommate would have random "strange" that he picks up at bars.  I would get up at 3am to use the bathroom and some late 30s woman would be stumbling out of his room to catch a cab back.  It was kind of hilarious.  He was a large tall man with a bit of a stutter.  But he got ripped in 6 months.  Freakish genetics and he always had a smile. So he went from looking like a friendly overweight dude to someone who was tall, dark, and handsome as Adele would say in her SNL skit.  That dude got so much action, it was crazy. 

My red haired Irish friend and I went out and will get a dozen drinks in us and we will bar hop to 4-5 different places.  My friends from HS was in the city.  They were always throwing a party from time to time.  My college friends were all in the city.  I can't imagine being anywhere else.   

Yeah, New York City sucks for now.  But I am willing to bet that 24 years old want to get laid or AT LEAST GET WASTED AND HAVE a SHOT. 

So I was paying $900 and making $75k base with $25k bonus in a middle market IB before my whole group was gutted in early 2009. 

Title: Re: Leaving New York City
Post by: LC on November 20, 2020, 09:12:40 PM
Wait, there’s a 9th Avenue?
Title: Re: Leaving New York City
Post by: rb on November 20, 2020, 09:22:44 PM
Why don't people talk about biology?  Why don't people talk about the fact that if you are 22-35, single, horny, and promising, you want to be in NYC to meet others just like you.  If you are 25, Asian (East and South), and can code or build complex financial models or just trying to revolutionize the world, you want to be here.  Your odds are slimmer in Wichita.  If you are LGBTQ, this is a great place for you.  If you want Dim Sum, this is the place for you (although capacity leaving the market temporarily).  50% of my thesis is that this is the deepest liquidity pool for dating.  I will continue to bet on biology.

not to mention the pricing from a consumer standpoint is starting to get super attractive in my view:

https://streeteasy.com/building/360-east-57-street-new_york/10b

this apartment (well one a few floors up or down) was $5100 when i lived there in the early 2010's. it's now $4200. rent down 20% from almost 10 years ago, while salaries/all-in comp for elite fields is probably up 20% (or more in some instances, I'm honestly not as in tune with entry level comp for banking/consulting/tech)

the living room can be a 3rd bedroom, that's $1,400 / month average for 3 dudes to live in manhattan making like mid $100's 1st year out of college (finance/tech/whatever), or $2000/month for recently graduated big law types making $250K (you get your own bathroom and a full living room for having to deal with law school). i'm sure this apartment is not the cheapest/most expensive, i just picked this one because i have a great sense of comparability and know what it's like to actually live there (it's nice, doorman building, perfectly acceptable). it's not a hip spot, the neighborhood's kind of boring, but you're a walk away from the offices in midtown and a wasted cab ride away from lots of night life.

people make a lot more today than in the early 2010's, the disposable income of the yuppie crowd. rents down = massive increase in disposable income for playing and getting ahead in the greatest city in the world and that applies at all levels.

think how cheap its getting to share apartments in outer boroughs. sure that's bad for near term NOI, but it also creates an attractive pull.  you can say "well ya but you could get a house or your own apartment for that in XXX", sure, but it's not in NYC.

rents are skyrocketing in the places people are leaving to. like in south Florida for example.

the NYC premium collapsing should help buffer the "exodus"

EDIT: for context, the 2BR I shared in the south immediately after my time in NYC is now $2000 up from $1500. So the spread went from $3,700/month to $2,200/month.


+1 to both -- if you're a young and single person, you will almost certainly be back in NYC in a few years regardless of whether you can do your work from Des Moines -- because then you would have to live in Des Moines.

thepupil inspired me to take a look at my old apartment in NYC. https://bit.ly/2IMTBJ8

The gross rent is maybe two hundred bucks north of where it was when I moved to NYC in 2007. As a 24 year old newly minted lawyer, I was more than happy to apply part of my $160k salary (now $190k for anyone starting NYC Biglaw) to a nice crib. Y'all are crazy if you think people won't want to live in NYC again.

Merkhet and Pupil,

You guys lived in way too fancy digs for me.  I was living on 9th Ave between 55th and 56th or maybe 54th and 55th.  It was a fourth floor walk up (European floors, so it was really 5th).  The place was a dump.  It was a long rectangular one bedroom where the bedroom is on one side and the living room is on the other side.  I was first subletting from a gay guy who taught ballet.  Then rent got too expensive for him.  I moved back to Queens.  Then I talked to the landlord and he let me rent the whole apartment.  I then sublet the place and posted an ad on Craigslist.  30 people showed up all ready to give me first month rent.  It was literally a reality show.  This was a shit apartment on 9th Ave and 50s in Hell's Kitchen near a row of restaurants.  But the rent was $1,900 and we can split it between 2 people and it functions like 2 separate studios on 2 opposite ends.  I first rented it to a female Cornell grad and I quickly realize I was becoming her relationship therapist and she quickly wanted out of the deal.  I was annoyed because I passed on an Apple tech guy in his late 30s because I wanted to live with someone younger.  I probably could've gotten it rented in 2 weeks.  But I was working IB hours and I had the girl's deposit.  So I took my time and ran another open house.  30 people showed up again.  People who work in the theater district, girls who were going to the Alvin Alley dance studios, finance people, and generally people making $50-100k who need a cheap place that was convenient.  I worked on 7th Ave and could just walk over to work without getting on any subways.  I used to ride my road bike in Central Park in the morning or go up the west side highway and go over the GW bridge to Jersey on the weekends.  I would carry my road bike up 5 flights of stairs while strapped to my bike shoes which is probably not smart.  Everyone wanted to sublet.  I winded up subletting to an African American man in his mid 20s who was working at a middle office job at JP Morgan.  So, in my short time, I had a gay Asian American roommate who taught ballet, an Asian American woman who couldn't get over her ex, and an African American man as roommate in a matter or 2 years. 

How bad was the place.  Paint was falling off the ceiling.  The tub needs a mat or it didn't drain well.  The place was old.  The doors to my bedroom didn't go all the way up or down.  My roommates' ceiling was falling off.  But did it matter?  A few things stood out.  I once somehow bought home 3 different girls in one week.  I peaked that week.  I also once convince a girl living in Delaware to board an Amtrak train to come to Penn Station at 7PM.  So she got ready at 7PM and arrived in NYC at midnight and we went out and had a great time.  My apartment was gross and she knew.  But she was coming to go out in New York city where you can stay out till 4AM.  My African American roommate would have random "strange" that he picks up at bars.  I would get up at 3am to use the bathroom and some late 30s woman would be stumbling out of his room to catch a cab back.  It was kind of hilarious.  He was a large tall man with a bit of a stutter.  But he got ripped in 6 months.  Freakish genetics and he always had a smile. So he went from looking like a friendly overweight dude to someone who was tall, dark, and handsome as Adele would say in her SNL skit.  That dude got so much action, it was crazy. 

My red haired Irish friend and I went out and will get a dozen drinks in us and we will bar hop to 4-5 different places.  My friends from HS was in the city.  They were always throwing a party from time to time.  My college friends were all in the city.  I can't imagine being anywhere else.   

Yeah, New York City sucks for now.  But I am willing to bet that 24 years old want to get laid or AT LEAST GET WASTED AND HAVE a SHOT. 

So I was paying $900 and making $75k base with $25k bonus in a middle market IB before my whole group was gutted in early 2009.
Ahhhh.... to be 24 again! What a life!

But 75/25? Seriously? I thought you worked at Citi.
Title: Re: Leaving New York City
Post by: cubsfan on November 21, 2020, 04:43:47 AM
^ Ok BG2008 - that settles it!  I'm moving to NY and want to be your roommate!
Title: Re: Leaving New York City
Post by: BG2008 on November 21, 2020, 05:02:55 AM
Why don't people talk about biology?  Why don't people talk about the fact that if you are 22-35, single, horny, and promising, you want to be in NYC to meet others just like you.  If you are 25, Asian (East and South), and can code or build complex financial models or just trying to revolutionize the world, you want to be here.  Your odds are slimmer in Wichita.  If you are LGBTQ, this is a great place for you.  If you want Dim Sum, this is the place for you (although capacity leaving the market temporarily).  50% of my thesis is that this is the deepest liquidity pool for dating.  I will continue to bet on biology.

not to mention the pricing from a consumer standpoint is starting to get super attractive in my view:

https://streeteasy.com/building/360-east-57-street-new_york/10b

this apartment (well one a few floors up or down) was $5100 when i lived there in the early 2010's. it's now $4200. rent down 20% from almost 10 years ago, while salaries/all-in comp for elite fields is probably up 20% (or more in some instances, I'm honestly not as in tune with entry level comp for banking/consulting/tech)

the living room can be a 3rd bedroom, that's $1,400 / month average for 3 dudes to live in manhattan making like mid $100's 1st year out of college (finance/tech/whatever), or $2000/month for recently graduated big law types making $250K (you get your own bathroom and a full living room for having to deal with law school). i'm sure this apartment is not the cheapest/most expensive, i just picked this one because i have a great sense of comparability and know what it's like to actually live there (it's nice, doorman building, perfectly acceptable). it's not a hip spot, the neighborhood's kind of boring, but you're a walk away from the offices in midtown and a wasted cab ride away from lots of night life.

people make a lot more today than in the early 2010's, the disposable income of the yuppie crowd. rents down = massive increase in disposable income for playing and getting ahead in the greatest city in the world and that applies at all levels.

think how cheap its getting to share apartments in outer boroughs. sure that's bad for near term NOI, but it also creates an attractive pull.  you can say "well ya but you could get a house or your own apartment for that in XXX", sure, but it's not in NYC.

rents are skyrocketing in the places people are leaving to. like in south Florida for example.

the NYC premium collapsing should help buffer the "exodus"

EDIT: for context, the 2BR I shared in the south immediately after my time in NYC is now $2000 up from $1500. So the spread went from $3,700/month to $2,200/month.


+1 to both -- if you're a young and single person, you will almost certainly be back in NYC in a few years regardless of whether you can do your work from Des Moines -- because then you would have to live in Des Moines.

thepupil inspired me to take a look at my old apartment in NYC. https://bit.ly/2IMTBJ8

The gross rent is maybe two hundred bucks north of where it was when I moved to NYC in 2007. As a 24 year old newly minted lawyer, I was more than happy to apply part of my $160k salary (now $190k for anyone starting NYC Biglaw) to a nice crib. Y'all are crazy if you think people won't want to live in NYC again.

Merkhet and Pupil,

You guys lived in way too fancy digs for me.  I was living on 9th Ave between 55th and 56th or maybe 54th and 55th.  It was a fourth floor walk up (European floors, so it was really 5th).  The place was a dump.  It was a long rectangular one bedroom where the bedroom is on one side and the living room is on the other side.  I was first subletting from a gay guy who taught ballet.  Then rent got too expensive for him.  I moved back to Queens.  Then I talked to the landlord and he let me rent the whole apartment.  I then sublet the place and posted an ad on Craigslist.  30 people showed up all ready to give me first month rent.  It was literally a reality show.  This was a shit apartment on 9th Ave and 50s in Hell's Kitchen near a row of restaurants.  But the rent was $1,900 and we can split it between 2 people and it functions like 2 separate studios on 2 opposite ends.  I first rented it to a female Cornell grad and I quickly realize I was becoming her relationship therapist and she quickly wanted out of the deal.  I was annoyed because I passed on an Apple tech guy in his late 30s because I wanted to live with someone younger.  I probably could've gotten it rented in 2 weeks.  But I was working IB hours and I had the girl's deposit.  So I took my time and ran another open house.  30 people showed up again.  People who work in the theater district, girls who were going to the Alvin Alley dance studios, finance people, and generally people making $50-100k who need a cheap place that was convenient.  I worked on 7th Ave and could just walk over to work without getting on any subways.  I used to ride my road bike in Central Park in the morning or go up the west side highway and go over the GW bridge to Jersey on the weekends.  I would carry my road bike up 5 flights of stairs while strapped to my bike shoes which is probably not smart.  Everyone wanted to sublet.  I winded up subletting to an African American man in his mid 20s who was working at a middle office job at JP Morgan.  So, in my short time, I had a gay Asian American roommate who taught ballet, an Asian American woman who couldn't get over her ex, and an African American man as roommate in a matter or 2 years. 

How bad was the place.  Paint was falling off the ceiling.  The tub needs a mat or it didn't drain well.  The place was old.  The doors to my bedroom didn't go all the way up or down.  My roommates' ceiling was falling off.  But did it matter?  A few things stood out.  I once somehow bought home 3 different girls in one week.  I peaked that week.  I also once convince a girl living in Delaware to board an Amtrak train to come to Penn Station at 7PM.  So she got ready at 7PM and arrived in NYC at midnight and we went out and had a great time.  My apartment was gross and she knew.  But she was coming to go out in New York city where you can stay out till 4AM.  My African American roommate would have random "strange" that he picks up at bars.  I would get up at 3am to use the bathroom and some late 30s woman would be stumbling out of his room to catch a cab back.  It was kind of hilarious.  He was a large tall man with a bit of a stutter.  But he got ripped in 6 months.  Freakish genetics and he always had a smile. So he went from looking like a friendly overweight dude to someone who was tall, dark, and handsome as Adele would say in her SNL skit.  That dude got so much action, it was crazy. 

My red haired Irish friend and I went out and will get a dozen drinks in us and we will bar hop to 4-5 different places.  My friends from HS was in the city.  They were always throwing a party from time to time.  My college friends were all in the city.  I can't imagine being anywhere else.   

Yeah, New York City sucks for now.  But I am willing to bet that 24 years old want to get laid or AT LEAST GET WASTED AND HAVE a SHOT. 

So I was paying $900 and making $75k base with $25k bonus in a middle market IB before my whole group was gutted in early 2009.
Ahhhh.... to be 24 again! What a life!

But 75/25? Seriously? I thought you worked at Citi.

I was in the group that did deals from $20mm to $1bn.  The IBD boys downtown made all the loot.  Their going rate that year was $65k plus about $100-110k.  My base was higher, but my upside on the bonus was much lower.  Part of it was because my group was full of politics and drama without the deal closing ability of the IBD.  But I learned so much by studying what not to do during that time.  I was getting 2-5 phone calls from desperate developers every week back then.  I guess I pass on a lot of opportunity today because I saw so many ways that you blow up in RE.  But the structure was my MD and 2 analysts.  My MD let me handle a lot of the incoming calls.  So I was functioning more like an idiotic VP with no experience.  What a way to drink from the fire hose! 
Title: Re: Leaving New York City
Post by: BG2008 on November 21, 2020, 05:04:41 AM
Why don't people talk about biology?  Why don't people talk about the fact that if you are 22-35, single, horny, and promising, you want to be in NYC to meet others just like you.  If you are 25, Asian (East and South), and can code or build complex financial models or just trying to revolutionize the world, you want to be here.  Your odds are slimmer in Wichita.  If you are LGBTQ, this is a great place for you.  If you want Dim Sum, this is the place for you (although capacity leaving the market temporarily).  50% of my thesis is that this is the deepest liquidity pool for dating.  I will continue to bet on biology.

not to mention the pricing from a consumer standpoint is starting to get super attractive in my view:

https://streeteasy.com/building/360-east-57-street-new_york/10b

this apartment (well one a few floors up or down) was $5100 when i lived there in the early 2010's. it's now $4200. rent down 20% from almost 10 years ago, while salaries/all-in comp for elite fields is probably up 20% (or more in some instances, I'm honestly not as in tune with entry level comp for banking/consulting/tech)

the living room can be a 3rd bedroom, that's $1,400 / month average for 3 dudes to live in manhattan making like mid $100's 1st year out of college (finance/tech/whatever), or $2000/month for recently graduated big law types making $250K (you get your own bathroom and a full living room for having to deal with law school). i'm sure this apartment is not the cheapest/most expensive, i just picked this one because i have a great sense of comparability and know what it's like to actually live there (it's nice, doorman building, perfectly acceptable). it's not a hip spot, the neighborhood's kind of boring, but you're a walk away from the offices in midtown and a wasted cab ride away from lots of night life.

people make a lot more today than in the early 2010's, the disposable income of the yuppie crowd. rents down = massive increase in disposable income for playing and getting ahead in the greatest city in the world and that applies at all levels.

think how cheap its getting to share apartments in outer boroughs. sure that's bad for near term NOI, but it also creates an attractive pull.  you can say "well ya but you could get a house or your own apartment for that in XXX", sure, but it's not in NYC.

rents are skyrocketing in the places people are leaving to. like in south Florida for example.

the NYC premium collapsing should help buffer the "exodus"

EDIT: for context, the 2BR I shared in the south immediately after my time in NYC is now $2000 up from $1500. So the spread went from $3,700/month to $2,200/month.


+1 to both -- if you're a young and single person, you will almost certainly be back in NYC in a few years regardless of whether you can do your work from Des Moines -- because then you would have to live in Des Moines.

thepupil inspired me to take a look at my old apartment in NYC. https://bit.ly/2IMTBJ8

The gross rent is maybe two hundred bucks north of where it was when I moved to NYC in 2007. As a 24 year old newly minted lawyer, I was more than happy to apply part of my $160k salary (now $190k for anyone starting NYC Biglaw) to a nice crib. Y'all are crazy if you think people won't want to live in NYC again.

Merkhet and Pupil,

You guys lived in way too fancy digs for me.  I was living on 9th Ave between 55th and 56th or maybe 54th and 55th.  It was a fourth floor walk up (European floors, so it was really 5th).  The place was a dump.  It was a long rectangular one bedroom where the bedroom is on one side and the living room is on the other side.  I was first subletting from a gay guy who taught ballet.  Then rent got too expensive for him.  I moved back to Queens.  Then I talked to the landlord and he let me rent the whole apartment.  I then sublet the place and posted an ad on Craigslist.  30 people showed up all ready to give me first month rent.  It was literally a reality show.  This was a shit apartment on 9th Ave and 50s in Hell's Kitchen near a row of restaurants.  But the rent was $1,900 and we can split it between 2 people and it functions like 2 separate studios on 2 opposite ends.  I first rented it to a female Cornell grad and I quickly realize I was becoming her relationship therapist and she quickly wanted out of the deal.  I was annoyed because I passed on an Apple tech guy in his late 30s because I wanted to live with someone younger.  I probably could've gotten it rented in 2 weeks.  But I was working IB hours and I had the girl's deposit.  So I took my time and ran another open house.  30 people showed up again.  People who work in the theater district, girls who were going to the Alvin Alley dance studios, finance people, and generally people making $50-100k who need a cheap place that was convenient.  I worked on 7th Ave and could just walk over to work without getting on any subways.  I used to ride my road bike in Central Park in the morning or go up the west side highway and go over the GW bridge to Jersey on the weekends.  I would carry my road bike up 5 flights of stairs while strapped to my bike shoes which is probably not smart.  Everyone wanted to sublet.  I winded up subletting to an African American man in his mid 20s who was working at a middle office job at JP Morgan.  So, in my short time, I had a gay Asian American roommate who taught ballet, an Asian American woman who couldn't get over her ex, and an African American man as roommate in a matter or 2 years. 

How bad was the place.  Paint was falling off the ceiling.  The tub needs a mat or it didn't drain well.  The place was old.  The doors to my bedroom didn't go all the way up or down.  My roommates' ceiling was falling off.  But did it matter?  A few things stood out.  I once somehow bought home 3 different girls in one week.  I peaked that week.  I also once convince a girl living in Delaware to board an Amtrak train to come to Penn Station at 7PM.  So she got ready at 7PM and arrived in NYC at midnight and we went out and had a great time.  My apartment was gross and she knew.  But she was coming to go out in New York city where you can stay out till 4AM.  My African American roommate would have random "strange" that he picks up at bars.  I would get up at 3am to use the bathroom and some late 30s woman would be stumbling out of his room to catch a cab back.  It was kind of hilarious.  He was a large tall man with a bit of a stutter.  But he got ripped in 6 months.  Freakish genetics and he always had a smile. So he went from looking like a friendly overweight dude to someone who was tall, dark, and handsome as Adele would say in her SNL skit.  That dude got so much action, it was crazy. 

My red haired Irish friend and I went out and will get a dozen drinks in us and we will bar hop to 4-5 different places.  My friends from HS was in the city.  They were always throwing a party from time to time.  My college friends were all in the city.  I can't imagine being anywhere else.   

Yeah, New York City sucks for now.  But I am willing to bet that 24 years old want to get laid or AT LEAST GET WASTED AND HAVE a SHOT. 

So I was paying $900 and making $75k base with $25k bonus in a middle market IB before my whole group was gutted in early 2009.
Ahhhh.... to be 24 again! What a life!

But 75/25? Seriously? I thought you worked at Citi.

I was in the group that did deals from $20mm to $1bn.  The IBD boys downtown made all the loot.  Their going rate that year was $65k plus about $100-110k.  My base was higher, but my upside on the bonus was much lower.  Part of it was because my group was full of politics and drama without the deal closing ability of the IBD.  But I learned so much by studying what not to do during that time.  I was getting 2-5 phone calls from desperate developers every week back then.  I guess I pass on a lot of opportunity today because I saw so many ways that you blow up in RE.  But the structure was my MD and 2 analysts.  My MD let me handle a lot of the incoming calls.  So I was functioning more like an idiotic VP with no experience.  What a way to drink from the fire hose!

I had to learn how to live on a budget on $100k.  Not like Merkhet and Pupil.  Those guys were the ballers stealing girls from me.  Life was kind of like "How I met your mother."  or at least I like to pretend it was like that.  But we didn't have as much free time.
Title: Re: Leaving New York City
Post by: cherzeca on November 21, 2020, 06:12:15 AM
if Woody Allen is reading this thread, he will be inspired to do the sequel, Manhattan 2.0
Title: Re: Leaving New York City
Post by: thepupil on November 21, 2020, 09:02:16 AM
I began to like New York, the racy, adventurous feel of it at night, and the satisfaction that the constant flicker of men and women and machines gives to the restless eye.

The city seen from the Queensboro Bridge is always the city seen for the first time, in its first wild promise of all the mystery and the beauty in the world.

There’s a reason the great american novel wasn’t about Detroit.
Title: Re: Leaving New York City
Post by: merkhet on November 21, 2020, 09:31:12 AM
I began to like New York, the racy, adventurous feel of it at night, and the satisfaction that the constant flicker of men and women and machines gives to the restless eye.

The city seen from the Queensboro Bridge is always the city seen for the first time, in its first wild promise of all the mystery and the beauty in the world.

There’s a reason the great american novel wasn’t about Detroit.

I thought the flickering of the green light across the water was the GM plant in the background. Oh man, this changes everything.
Title: Re: Leaving New York City
Post by: thepupil on November 21, 2020, 09:48:54 AM
The orgiastic future...as represented by the shores of Windsor Ontario
Title: Re: Leaving New York City
Post by: DW on November 21, 2020, 09:57:36 AM
Wait, there’s a 9th Avenue?


Hysterical
Title: Re: Leaving New York City
Post by: DooDiligence on November 21, 2020, 01:49:30 PM
This is the emotional side of CoBF I've always loved.
Riffing on what's good in the world...
Title: Re: Leaving New York City
Post by: fareastwarriors on November 21, 2020, 03:35:13 PM
After reading through this, I felt like I wasted my 20s.
 ;D
Title: Re: Leaving New York City
Post by: cherzeca on November 21, 2020, 05:36:59 PM
After reading through this, I felt like I wasted my 20s.
 ;D

we all did.  but truth be known, we are better off for it
Title: Re: Leaving New York City
Post by: BG2008 on November 21, 2020, 06:21:51 PM
^ Ok BG2008 - that settles it!  I'm moving to NY and want to be your roommate!

Anytime Cubsfan.  I'll give up the wife and kids to be your roomie!
Title: Re: Leaving New York City
Post by: BG2008 on November 21, 2020, 06:22:24 PM
^ Ok BG2008 - that settles it!  I'm moving to NY and want to be your roommate!

Anytime Cubsfan.  I'll give up the wife and kids to be your roomie!

My wife is literally sitting next to me while I typed this.  Good thing she's got a good sense of humor. 
Title: Re: Leaving New York City
Post by: rb on November 21, 2020, 07:56:04 PM
After reading through this, I felt like I wasted my 20s.
 ;D

we all did.  but truth be known, we are better off for it
OH YEAH!!!

I'm from about the same cohort as merkhet, pupil and BG. I'm had shall we say a similar experience. Great times! But I've done my banking "apprenticeship" in London so it was a different vibe. I didn't feel I had the right to talk about it since this is a thread about the city that never sleeps. Though I didn't get much sleep in London either  ;D
Title: Re: Leaving New York City
Post by: BG2008 on November 25, 2020, 08:12:42 AM
Living in NYC is no different to living in a London, Paris, Milan, Sydney,  Barcelona, etc.
If you are a young person and shopping for a mate, this is where you want to be .... but it's a limited term engagement (6-7 yrs at most). You are also a big chunk of the annual churn - once you've decided to settle down you're renting in the burbs, 'cause kids are expensive!

If most WFH and zoom all day - both the opportunities and the pool of potential mates in NYC just crashed.
F*** It!, live in the burbs, travel to NYC on the weekend, and just rent a room in the DT on saturday night. Hotels are hurting, deals are abundant, and you look 'smart'. Not paying inflated rents, no car to maintain, discretionary cashflow, yada, yada. Common practice.

6-7 years? Graduate at 24/25 with a masters/designation, if the family hasn't started by 30/31 it isn't going to.
Better get to it - 'cause the clock is ticking!

Does it come back? Sure, but anyone's guess as to when
Is it cheap? Compared to what, and is the comparative relevant

SD

I think you are describing the bridge and tunnel people, ugg second class citizen in the dating pool.  Chicks don't dig!

NYC RE is one of those things that smart finance people can't wrap their head around.  But my seemingly dumb parents and relatives with elementary education understands instinctively.  Because they see ability to raise rent over time (okay not this year, but long term) and they ain't building more land in NYC.  To really appreciate how good of a business it is, you have to kind of dumb yourself down and take off your "smart value investor hat."  I mean this in a tongue and cheek way, but I am totally serious about it as well.  Because my parents who dropped out of school at first and 5th grade understand these dynamics much better than I did.  I told them about cap rates blah blah blah.  Over 10 years, I realized that a lot of my personal wealth comes from the long term appreciation of owning RE in NYC.   
Title: Re: Leaving New York City
Post by: Gregmal on November 25, 2020, 08:16:18 AM
Not trying to be the smartest guy in the market was some of the best advice I ever received when it came to investing. You kind of want to be a jack of all traits but a master of none.
Title: Re: Leaving New York City
Post by: BG2008 on November 25, 2020, 08:44:42 AM
Not trying to be the smartest guy in the market was some of the best advice I ever received when it came to investing. You kind of want to be a jack of all traits but a master of none.

I think you want to be a jack of all trades but a journeyman of 2-3 niches.  I happen to be a journeyman of RE niche, specialty chemicals, and distribution density of sorts. 
Title: Re: Leaving New York City
Post by: cubsfan on November 25, 2020, 02:14:26 PM
I thought Illinois was bad - this is frickin' crazy:

https://www.breitbart.com/politics/2020/11/25/nyc-to-have-coronavirus-checkpoints-sheriff-warns-of-consequences-for-violating-quarantine/

“Violation of a self-quarantine travel regulation may result in deputy sheriffs serving you a mandatory quarantine order issued by the Health Commissioner. In cases of violation, Deputies could serve you with a civil summons that carries a $1,000 fine,” he said, although he emphasized that officers will be focusing primarily on large gatherings:
Title: Re: Leaving New York City
Post by: cwericb on November 25, 2020, 02:48:02 PM
Around here, violate quarantine first time - $1,000, second time, $2,000, third time $!0,000. I only know of one person caught 3 times and I don't know about the fine but I do know he had an extended stay in the crowbar hotel.
Title: Re: Leaving New York City
Post by: SharperDingaan on November 25, 2020, 02:48:53 PM
Late at night, she just doesn't want to tip her hand that she's from across the tunnel or the bridge  ;D
Free drinks, and saves on the hotel room - smart women!

SD
Title: Re: Leaving New York City
Post by: Gregmal on November 25, 2020, 03:03:35 PM
I thought Illinois was bad - this is frickin' crazy:

https://www.breitbart.com/politics/2020/11/25/nyc-to-have-coronavirus-checkpoints-sheriff-warns-of-consequences-for-violating-quarantine/

“Violation of a self-quarantine travel regulation may result in deputy sheriffs serving you a mandatory quarantine order issued by the Health Commissioner. In cases of violation, Deputies could serve you with a civil summons that carries a $1,000 fine,” he said, although he emphasized that officers will be focusing primarily on large gatherings:

Unfortunately, in our states, you cant present a firearm to an uninvited guest even if its on your own property. But I do have a Tibetan Mastiff and would be happy so see one of these unwanted "inspectors" meet him. Would be especially entertaining for everyone during Thanksgiving festivities. Mind your own damn business and you'll be safe.
Title: Re: Leaving New York City
Post by: muscleman on November 27, 2020, 06:48:35 PM
Not just NYC, I noticed a massive exodus of Seattle as well. Just check redfin listings for Seattle. Lots of listings, especially condos, with hardly any buyer taking a tour.
Title: Re: Leaving New York City
Post by: cwericb on November 27, 2020, 07:38:58 PM
The real estate market in Atlantic Canada has been on fire as people from across the country and elsewhere see the area as a relatively safe place from the virus.

People are buying houses site unseen just to get authorization to move into the area. Prices are up 20%+ in the past year. The construction industry is booming and many contractors are booked over a year ahead. This has also fed an increased demand for furniture and all the other necessities required by new people moving into the area.

Ironically this has gone a long way to offset the losses the tourism industry has suffered. It seems to show that taking steps to control the virus is not necessarily detrimental to the economy.
Title: Re: Leaving New York City
Post by: Cardboard on November 27, 2020, 07:51:52 PM
Cwericb, that is about the most delusional post that I have read in a long time.

No one is "immigrating" to Atlantic Canada pushing up prices because no one wants to go there.

Now, getting back to the real cause of price increase it is because people are moving out of condos to suburbs and it makes detached homes to go up in price or a global phenomenon. Then condo prices have not adjusted yet to lower demand reality because of price anchoring.

Cardboard
Title: Re: Leaving New York City
Post by: rb on November 27, 2020, 08:27:40 PM
Cwericb, that is about the most delusional post that I have read in a long time.

No one is "immigrating" to Atlantic Canada pushing up prices because no one wants to go there.

Now, getting back to the real cause of price increase it is because people are moving out of condos to suburbs and it makes detached homes to go up in price or a global phenomenon. Then condo prices have not adjusted yet to lower demand reality because of price anchoring.

Cardboard
Please, tell us more oh ye great one! While we wait:

https://www.statista.com/statistics/609158/number-of-immigrants-in-new-brunswick/

https://www.statista.com/statistics/609156/number-of-immigrants-in-nova-scotia/

https://www.statista.com/statistics/609153/number-of-immigrants-in-prince-edward-island/#:~:text=This%20statistic%20shows%20the%20number,immigrants%20to%20Prince%20Edward%20Island.

https://www.statista.com/statistics/609051/number-of-immigrants-in-newfoundland-and-labrador/
Title: Re: Leaving New York City
Post by: fareastwarriors on November 27, 2020, 08:31:34 PM
Not just NYC, I noticed a massive exodus of Seattle as well. Just check redfin listings for Seattle. Lots of listings, especially condos, with hardly any buyer taking a tour.

Make sense though. Large city with many renters, large population of young and single people and high cost. But I bet Seattle suburbs are white hot.

I'm throwing 700k cash offers at 3bed/1bath 1,000 sq ft houses  in the east bay of San Francisco. I'm not even competitive apparently...
Title: Re: Leaving New York City
Post by: Spekulatius on November 27, 2020, 08:53:34 PM
Not just NYC, I noticed a massive exodus of Seattle as well. Just check redfin listings for Seattle. Lots of listings, especially condos, with hardly any buyer taking a tour.

Make sense though. Large city with many renters, large population of young and single people and high cost. But I bet Seattle suburbs are white hot.

I'm throwing 700k cash offers at 3bed/1bath 1,000 sq ft houses  in the east bay of San Francisco. I'm not even competitive apparently...

Suburbs have largely lacked the price appreciating that Appartement or houses in the city areas had. I lived in Long Island and now in Boston area and in both cases, houses were still below ~2005 prices.  I think RE in thr city core might have doubled with8b the same time frame. If this trend reverses, it could have a long way to go, but I somehow doubt that it will.
Title: Re: Leaving New York City
Post by: alpha on November 27, 2020, 09:23:18 PM
Cwericb, that is about the most delusional post that I have read in a long time.

No one is "immigrating" to Atlantic Canada pushing up prices because no one wants to go there.

Now, getting back to the real cause of price increase it is because people are moving out of condos to suburbs and it makes detached homes to go up in price or a global phenomenon. Then condo prices have not adjusted yet to lower demand reality because of price anchoring.

Cardboard

I don't know about the East Coast but I have been getting into bidding wars for houses on Canada's West Coast and the realtors tell me it is mostly out of province/country bidders I am competing with... people fleeing Toronto/Vancouver etc...

Title: Re: Leaving New York City
Post by: patience_and_focus on November 27, 2020, 10:46:34 PM
Not just NYC, I noticed a massive exodus of Seattle as well. Just check redfin listings for Seattle. Lots of listings, especially condos, with hardly any buyer taking a tour.

Make sense though. Large city with many renters, large population of young and single people and high cost. But I bet Seattle suburbs are white hot.

I'm throwing 700k cash offers at 3bed/1bath 1,000 sq ft houses  in the east bay of San Francisco. I'm not even competitive apparently...

Suburbs have largely lacked the price appreciating that Appartement or houses in the city areas had. I lived in Long Island and now in Boston area and in both cases, houses were still below ~2005 prices.  I think RE in thr city core might have doubled with8b the same time frame. If this trend reverses, it could have a long way to go, but I somehow doubt that it will.

Actually good bay area suburban housing has been on fire since a couple of years after the GFC. The suburban city of Burlingame (17 miles south of San Francisco) has seen a 2.5X price rise for single family homes in the last 10 years (Dec-2010 to now). That is annualized appreciation of nearly 10%. If you take last 25 years for this suburb that number comes to about 7.5% annualized which is rivaling S&P returns (without dividends reinvested of-course).

https://www.zillow.com/burlingame-ca/home-values/

For comparison San Francisco (SF) has appreciated "only" 2X in the last 10 years for single family homes (7.5% annualized) and about 4X in the last 25 years (for a return of 6% annualized).

SF Zillow:
https://www.zillow.com/san-francisco-ca/home-values/

SF Case Shiller:
https://fred.stlouisfed.org/series/SFXRSA
Title: Re: Leaving New York City
Post by: cwericb on November 28, 2020, 06:56:58 AM

Cwericb, that is about the most delusional post that I have read in a long time.

No one is "immigrating" to Atlantic Canada pushing up prices because no one wants to go there.

Now, getting back to the real cause of price increase it is because people are moving out of condos to suburbs and it makes detached homes to go up in price or a global phenomenon. Then condo prices have not adjusted yet to lower demand reality because of price anchoring.

Cardboard

Good Morning Cadboard

Once again you are embarrassing yourself with your insults and your sadly ill informed opinions. Still hiding in your basement?

Perhaps you know more than the Financial Post, but here is what they say...

"Atlantic Canada’s housing market on fire as buyers from across the country swoop in to snap up homes."

https://financialpost.com/real-estate/how-the-pandemic-lit-the-fire-of-a-red-hot-real-estate-market-inside-the-atlantic-bubble

Here are a few other headlines just to help you out...

“How the pandemic 'lit the fire' of a red-hot real estate market inside the Atlantic bubble” 

“Atlantic bubble fuelling red hot Maritime real estate market”

“Booming Halifax housing market shows no signs of slowing ...”


Now who is delusional?

By the way, how is the real estate market doing in your area these days?

Cwericb
Title: Re: Leaving New York City
Post by: bizaro86 on November 28, 2020, 07:00:21 AM
Not just NYC, I noticed a massive exodus of Seattle as well. Just check redfin listings for Seattle. Lots of listings, especially condos, with hardly any buyer taking a tour.

Make sense though. Large city with many renters, large population of young and single people and high cost. But I bet Seattle suburbs are white hot.

I'm throwing 700k cash offers at 3bed/1bath 1,000 sq ft houses  in the east bay of San Francisco. I'm not even competitive apparently...

Suburbs have largely lacked the price appreciating that Appartement or houses in the city areas had. I lived in Long Island and now in Boston area and in both cases, houses were still below ~2005 prices.  I think RE in thr city core might have doubled with8b the same time frame. If this trend reverses, it could have a long way to go, but I somehow doubt that it will.

Actually good bay area suburban housing has been on fire since a couple of years after the GFC. The suburban city of Burlingame (17 miles south of San Francisco) has seen a 2.5X price rise for single family homes in the last 10 years (Dec-2010 to now). That is annualized appreciation of nearly 10%. If you take last 25 years for this suburb that number comes to about 7.5% annualized which is rivaling S&P returns (without dividends reinvested of-course).

https://www.zillow.com/burlingame-ca/home-values/

For comparison San Francisco (SF) has appreciated "only" 2X in the last 10 years for single family homes (7.5% annualized) and about 4X in the last 25 years (for a return of 6% annualized).

SF Zillow:
https://www.zillow.com/san-francisco-ca/home-values/

SF Case Shiller:
https://fred.stlouisfed.org/series/SFXRSA

If you bought a house with no leverage (and thus only received that unleveraged appreciation) I think its pretty likely the net cash flow from rent (or rent avoided) would have been at least comparable to the dividends received from the S&P.
Title: Re: Leaving New York City
Post by: clutch on November 28, 2020, 07:17:08 AM
I wish more people flee out of Toronto where I'm living. Less traffic, less competition for high paying jobs, and hopefully less real estate prices so I could finally afford to buy a home within the city.
Title: Re: Leaving New York City
Post by: muscleman on November 28, 2020, 09:23:54 AM
Not just NYC, I noticed a massive exodus of Seattle as well. Just check redfin listings for Seattle. Lots of listings, especially condos, with hardly any buyer taking a tour.

Make sense though. Large city with many renters, large population of young and single people and high cost. But I bet Seattle suburbs are white hot.

I'm throwing 700k cash offers at 3bed/1bath 1,000 sq ft houses  in the east bay of San Francisco. I'm not even competitive apparently...

Right. Seattle Suburbs are white hot not only because of the virus but also because of the socialism movement in Seattle, with BLM protesters matching into communities and yelling door to door "Move your white ass out of the house and give your stocks to us, because it belongs to us"
Title: Re: Leaving New York City
Post by: DooDiligence on November 28, 2020, 09:39:09 AM
Not just NYC, I noticed a massive exodus of Seattle as well. Just check redfin listings for Seattle. Lots of listings, especially condos, with hardly any buyer taking a tour.

Make sense though. Large city with many renters, large population of young and single people and high cost. But I bet Seattle suburbs are white hot.

I'm throwing 700k cash offers at 3bed/1bath 1,000 sq ft houses  in the east bay of San Francisco. I'm not even competitive apparently...

Right. Seattle Suburbs are white hot not only because of the virus but also because of the socialism movement in Seattle, with BLM protesters matching into communities and yelling door to door "Move your white ass out of the house and give your stocks to us, because it belongs to us"

Meanwhile in the real world.

www.bloomberg.com/news/articles/2020-10-30/brookfield-pays-365-million-for-facebook-office-outside-seattle
Title: Re: Leaving New York City
Post by: LearningMachine on November 28, 2020, 09:41:47 AM
Not just NYC, I noticed a massive exodus of Seattle as well. Just check redfin listings for Seattle. Lots of listings, especially condos, with hardly any buyer taking a tour.

Make sense though. Large city with many renters, large population of young and single people and high cost. But I bet Seattle suburbs are white hot.

I'm throwing 700k cash offers at 3bed/1bath 1,000 sq ft houses  in the east bay of San Francisco. I'm not even competitive apparently...

Right. Seattle Suburbs are white hot not only because of the virus but also because of the socialism movement in Seattle, with BLM protesters matching into communities and yelling door to door "Move your white ass out of the house and give your stocks to us, because it belongs to us"

BLM protests were just in one block, that too a while back, and overwhelming majority of folks participating were white.  Yes, there is a small risk that City of Seattle itself could have a tiny income tax sometime in the future, but so far WA State Supreme Court has been shooting it down, and keeping City of Seattle as well as WA state income tax free.

There are two key items impacting decision-making the most currently:


Because #2 trend will stop soon and reverse itself, while #1 trend will continue, there will be a net-effective increase in supply of housing.  In Detroit, 20% vacancy/supply caused a huge drop in real estate.  The price drop will be felt even in the suburbs immediately close to Microsoft, Google, Facebook and Amazon.  Post-vaccine, the only winner I see is exurbs, and that might not be very big either because effective overall supply has gone up for well-paid folks who won't have to go to office every day.
Title: Re: Leaving New York City
Post by: SharperDingaan on November 28, 2020, 10:19:30 AM
Just to throw it out ...

There are a great many towns in the Toronto Golden Horseshoe where developers are offering the penthouse floors of new built/to-be-built condos at very attractive incentives. 35-40%+ discounts, taken as either free upgrades or extended periods of reduced condo fees. If the intent going into retirement; is to either flip the SFH (now too big), or the newly acquired condo; it can be very attractive  ;)

Think outside the box a bit.

SD


 
Title: Re: Leaving New York City
Post by: LearningMachine on November 28, 2020, 10:41:44 AM
Not just NYC, I noticed a massive exodus of Seattle as well. Just check redfin listings for Seattle. Lots of listings, especially condos, with hardly any buyer taking a tour.

Make sense though. Large city with many renters, large population of young and single people and high cost. But I bet Seattle suburbs are white hot.

I'm throwing 700k cash offers at 3bed/1bath 1,000 sq ft houses  in the east bay of San Francisco. I'm not even competitive apparently...

Right. Seattle Suburbs are white hot not only because of the virus but also because of the socialism movement in Seattle, with BLM protesters matching into communities and yelling door to door "Move your white ass out of the house and give your stocks to us, because it belongs to us"

Meanwhile in the real world.

www.bloomberg.com/news/articles/2020-10-30/brookfield-pays-365-million-for-facebook-office-outside-seattle

Facebook's WFH announcements and having desirable office-space are not entirely inconsistent.  Younger folks do like to go into office once in a while to socialize.  What will be different now is that the younger talent won't be required to come into office every day, and won't pay $3000 rent to be at a walkable distance to Facebook office building.

In the meantime, within Facebook in the real world, after the WFH policy announcements, there has been such a tremendous demand for requesting permanent WFH processing that Facebook had to structure it in waves, and put people on waitlist for future waves, which will take months to process even though they are processing as fast as they can.

Just imagine what the residential demand next to Facebook buildings will look like once Facebook has gone through all the internal permanent WFH processing waves.

Microsoft doesn't require any processing for WFH up to 50%.  So, once folks are vaccinated, taking away pressure from people's desire to avoid multifamily, imagine what will happen to residential demand next to Microsoft buildings.   If we get vaccinated by March, effects of increased supply of options should start to show up next summer.
Title: Re: Leaving New York City
Post by: Gregmal on November 28, 2020, 11:04:21 AM
I dont know how much one can take from the current situation other than simply acknowledging that some of these things already existed and will just progress with time. Covid is only a short term headwind. But the larger trends of high taxes in some of the places, anti business policy, and now violence...are bad, but will too pass.

The current opportunity depends on your time horizon, and big baller status. Guys who answer to no one and who have shown to be opportunistic, like Flatt, Bezos, Zuck, etc.... theyre active and buying. They see that things will go back to normal, eventually. But other than that, who is going to pull the trigger today? If you're a Sr VP and heading up the division responsible for managing RE and signing leases, no way in hell you're going to be the guy who signs a lease in the middle of a pandemic; raging civil unrest, unprecedented violence, and widespread lockdowns... how do you explain that to your boss, who then has to explain that to the CEO, who then has to answer to the Board, who then has to answer to short term centric shareholders?

Everything really makes sense within context. Its not surprising, its an easy opportunity, but I dont think it will be get rich quick.
Title: Re: Leaving New York City
Post by: LearningMachine on November 28, 2020, 11:20:54 AM
I dont know how much one can take from the current situation other than simply acknowledging that some of these things already existed and will just progress with time. Covid is only a short term headwind. But the larger trends of high taxes in some of the places, anti business policy, and now violence...are bad, but will too pass.

The current opportunity depends on your time horizon, and big baller status. Guys who answer to no one and who have shown to be opportunistic, like Flatt, Bezos, Zuck, etc.... theyre active and buying. They see that things will go back to normal, eventually. But other than that, who is going to pull the trigger today? If you're a Sr VP and heading up the division responsible for managing RE and signing leases, no way in hell you're going to be the guy who signs a lease in the middle of a pandemic; raging civil unrest, unprecedented violence, and widespread lockdowns... how do you explain that to your boss, who then has to explain that to the CEO, who then has to answer to the Board, who then has to answer to short term centric shareholders?

Everything really makes sense within context. Its not surprising, its an easy opportunity, but I dont think it will be get rich quick.

Regarding Zuckerberg, I'm assuming you are referring to office real estate decisions in Bellevue and Manhattan.  Things don't have to go back to normal, eventually, for those decisions to make sense for Facebook's desire for young talent.  At the same time, I hope you are also not ignoring that Zuckerberg has announced that 50% of Facebook employees will be WFH permanently.  From talking to Facebook employees, they are saying 50% doesn't apply to engineering and highly paid folks, all of whom are allowed to apply for permanent WFH processing.

Regarding Bezos, I'm assuming you are referring to office real estate decisions in Bellevue, Manhattan and D.C.  Those decisions were made at a time when Bezos hadn't yet heard about his competitors offering WFH policies.  Amazon has always been the last one to care about employees.  The only thing that causes them to care is when they start to lose people to competitors.  Now, Amazon is starting to walk away from Seattle real estate.

Regarding Flatt, I'm not sure if I would put him in the same bucket as Bezos and Zuckerberg.  He has an incentive to pump up things. Not impressed by their head-stuck-in-sand type comments I heard a few months ago about denying anything is going to be different.

So, I think saying that everything will go back to normal, eventually, is a little simplistic.  We need to look at the reasons driving them, and those reasons may still be consistent with things not going back to exactly the way it was.
Title: Re: Leaving New York City
Post by: LearningMachine on November 28, 2020, 11:37:34 AM
I think Bill Gates probably has the best most-reasonable prediction:

Quote
"My prediction would be that ... over 30% of days in the office will go away," Gates said.

https://www.weforum.org/agenda/2020/11/bill-gates-pandemic-covid-coronavirus-work-travel-business-digital/

That has impact on residential housing immediately next to most-desirable office buildings that do survive.
Title: Re: Leaving New York City
Post by: Gregmal on November 28, 2020, 11:54:47 AM
WFH is highly overblown. Sure, it will continue and progress. But you miss the fact that it may be in the interests of many of these folks to tout worker friendly "choices" surrounding WFH. That doesnt mean people will want it. People have loved city centers for as long as there have been civilizations. Young people want bars, clubs, restaurants, and lots of sex. This only happens in the cities. Or put another way, it doesnt happen rurally, and unless you're looking to boink soccer moms, doesnt happen in the burbs. The cities from a real estate perspective are trophy assets. Its supply and demand. With the degree to which capital is gushing into every corner of the universe, even a reasonable demand decline is more than offset by lower rates and greater number of dollars chasing fewer and fewer available assets.

If you want to make an excuse for why guys like Bezos, Zuck, Flatt, etc are buying, fine. I'd prefer to just take it for what it is. It isn't one guy being an outlier...its multiple people and firms who are known for being savvy and opportunistic, doing so. If nothing else its proof of the above. Rich get richer, have more money to deploy....so they deploy it. Brookfield has a whole lot more capital to pour into these assets, and so do a lot of other HNW individuals, institutions, etc. Its the same reason you're seeing shopping centers and retail properties in prized locations selling at record prices, despite a much more dire narrative surrounding them. If anything thinks 5 years from now you see NY RE trading hands at $300 sq/ft....youre simply out to lunch.
Title: Re: Leaving New York City
Post by: LearningMachine on November 28, 2020, 02:38:55 PM
WFH is highly overblown. Sure, it will continue and progress. But you miss the fact that it may be in the interests of many of these folks to tout worker friendly "choices" surrounding WFH. That doesnt mean people will want it. People have loved city centers for as long as there have been civilizations. Young people want bars, clubs, restaurants, and lots of sex. This only happens in the cities. Or put another way, it doesnt happen rurally, and unless you're looking to boink soccer moms, doesnt happen in the burbs. The cities from a real estate perspective are trophy assets. Its supply and demand. With the degree to which capital is gushing into every corner of the universe, even a reasonable demand decline is more than offset by lower rates and greater number of dollars chasing fewer and fewer available assets.

If you want to make an excuse for why guys like Bezos, Zuck, Flatt, etc are buying, fine. I'd prefer to just take it for what it is. It isn't one guy being an outlier...its multiple people and firms who are known for being savvy and opportunistic, doing so. If nothing else its proof of the above. Rich get richer, have more money to deploy....so they deploy it. Brookfield has a whole lot more capital to pour into these assets, and so do a lot of other HNW individuals, institutions, etc. Its the same reason you're seeing shopping centers and retail properties in prized locations selling at record prices, despite a much more dire narrative surrounding them. If anything thinks 5 years from now you see NY RE trading hands at $300 sq/ft....youre simply out to lunch.

Gregmal, we don't have to think in extremes, but can try to handicap in a rational manner. 

I'm not saying NY RE will be trading hands at $300 in five years. I'm also not saying that young people won't like to be in cities for dating, etc.  I'm not sure why you are assuming that is what I am saying.
Title: Re: Leaving New York City
Post by: Gregmal on November 28, 2020, 03:05:16 PM
I kind of assumed that, along with your quite bearish tone because that is what you had conveyed in some other threads. I think in the ESRT thread you were talking about $100-$200 sq/ft.

The thread is about NY, and if those couple things return, ie nightlife, entertainment, etc...so will the people. They do have an interest to get crime down, although there's tended to be cyclical trends with that, and it is not uncommon for there to be high crime during periods of economic disarray. Those issues shakeout, and you'll be seeing record prices again. Similar areas will likely see similar progression. If this isn't what we are talking about, then I dont now what we're doing in a thread about folks fleeing NYC.

So if we are talking about this as an investor, there's really not a whole lot of "risk" posed to NYC or major city hubs, by WFH. The risk is that the drivers that make the city attractive go away...this is a low probability risk IMO.

If we are just talking in general about a hiccup in terms of demand...so what? Thats what cycles are.

If it isn't any of the above, then I am not quite sure what you are saying.... If anything, I think WFH is a ticking time bomb for suburban office space. Although anecdotally, I've been able to WFH since 2014. I've leased 5 different offices during this time and still pretty much did a hybrid 3/2 type of thing. I was still paying the full rent. Most offices in non prime locations regularly operate at below 100% occupancy and have had no problem gradually raising prices either. Either way, cities will be fine. The question is when, not if.
Title: Re: Leaving New York City
Post by: LearningMachine on November 28, 2020, 04:16:15 PM
I kind of assumed that, along with your quite bearish tone because that is what you had conveyed in some other threads. I think in the ESRT thread you were talking about $100-$200 sq/ft.

The thread is about NY, and if those couple things return, ie nightlife, entertainment, etc...so will the people. They do have an interest to get crime down, although there's tended to be cyclical trends with that, and it is not uncommon for there to be high crime during periods of economic disarray. Those issues shakeout, and you'll be seeing record prices again. Similar areas will likely see similar progression. If this isn't what we are talking about, then I dont now what we're doing in a thread about folks fleeing NYC.

So if we are talking about this as an investor, there's really not a whole lot of "risk" posed to NYC or major city hubs, by WFH. The risk is that the drivers that make the city attractive go away...this is a low probability risk IMO.

If we are just talking in general about a hiccup in terms of demand...so what? Thats what cycles are.

If it isn't any of the above, then I am not quite sure what you are saying.... If anything, I think WFH is a ticking time bomb for suburban office space. Although anecdotally, I've been able to WFH since 2014. I've leased 5 different offices during this time and still pretty much did a hybrid 3/2 type of thing. I was still paying the full rent. Most offices in non prime locations regularly operate at below 100% occupancy and have had no problem gradually raising prices either. Either way, cities will be fine. The question is when, not if.

Yes, I handicapped on ESRT, got in below $5.50 and got out at $10.  Thanks to your and pupil's contribution to that handicapping as well.

Because someone was talking about Seattle in this thread, I went along. When trying to handicap residential prices next to Microsoft, Amazon, Facebook and Google in Seattle area, I'm saying there will be some negative impact to prices in real life as a result of Bill Gates' prediction of more than 30% of days not being spent in office anymore (which I agree with), and there will be some positive impact to residential prices in exurbs in Seattle area. 

I agree with you that young people will not leave cities.  I hope you will also agree that young folks also don't have to live next to their employer anymore.  Some can live in the middle of Seattle next to bars cheaper than for living next to Facebook, Amazon, Google or Microsoft.  Some family folks can live in exurbs with water view cheaper than for living next to headquarters.

Looks like you also agree with Bill Gates' prediction, and that's why you are saying suburban office real estate might be in trouble.
Title: Re: Leaving New York City
Post by: Gregmal on November 28, 2020, 04:41:11 PM
I kind of assumed that, along with your quite bearish tone because that is what you had conveyed in some other threads. I think in the ESRT thread you were talking about $100-$200 sq/ft.

The thread is about NY, and if those couple things return, ie nightlife, entertainment, etc...so will the people. They do have an interest to get crime down, although there's tended to be cyclical trends with that, and it is not uncommon for there to be high crime during periods of economic disarray. Those issues shakeout, and you'll be seeing record prices again. Similar areas will likely see similar progression. If this isn't what we are talking about, then I dont now what we're doing in a thread about folks fleeing NYC.

So if we are talking about this as an investor, there's really not a whole lot of "risk" posed to NYC or major city hubs, by WFH. The risk is that the drivers that make the city attractive go away...this is a low probability risk IMO.

If we are just talking in general about a hiccup in terms of demand...so what? Thats what cycles are.

If it isn't any of the above, then I am not quite sure what you are saying.... If anything, I think WFH is a ticking time bomb for suburban office space. Although anecdotally, I've been able to WFH since 2014. I've leased 5 different offices during this time and still pretty much did a hybrid 3/2 type of thing. I was still paying the full rent. Most offices in non prime locations regularly operate at below 100% occupancy and have had no problem gradually raising prices either. Either way, cities will be fine. The question is when, not if.

Your figures are an exaggeration above, but yes, I handicapped on ESRT, got in below $5.50 and got out at $10. 

When trying to handicap residential prices next to Microsoft, Amazon, Facebook and Google in Seattle area, I'm saying there will be some negative impact to prices in real life as a result of Bill Gates prediction of more than 30% of days not being spent in office anymore, and there will be some positive impact to residential prices in exurbs in Seattle area.  That's all, no extreme statements.

Thats hardly a controversial statement then and Id even agree with you. There will be some softness and suburbs/rural will benefit. Thats already occurring. But I also wouldn't underestimate the desire of people otherwise priced out of an area to be waiting for the opportunity. I dont think its Gates prediction but rather supply and demand at work. However longer term, the question, and investment opportunity I think is pretty clear. What happened following the GFC where masses of folks were evicted/foreclosed? When the forecasted "new normal" was that everyone and their mother would be renters from now on. An unprecedented wave of private investor/institutional money came in and snapped up homes in desirable but out of favor areas. And its been nothing short of a home run for them. I wouldn't confuse the current covid hysteria where people are literally forced to WFH and daily occupancy rates are like 20% as a new normal. Two years from now most people who were working in an office will still work from at an office. Not just younger people; you dont think the average middle aged married person with kids doesnt cherish the break from that? Or the single, middle aged person not quite young enough for dating apps to be appealing? Where do they get social interaction? The distortion often emerges when there are irregularities and imbalances. Not a whole lot different than when we had an excess supply of stocks in March. The pendulum is always swinging. Sometimes it is fairly straight forward/easy to step back and simply determine whether we are in or out of favor, and then look at what needs to occur to get to the other side. In relation to the thread topic, for NY, its opening back up businesses, getting crime down, and probably looking in the mirror as far as tax policy goes. Pulling shit like they did with Amazon certainly didnt help, but I dont think thats something they can get away with doing repeatedly, and sooner or later they'll see that.