Will NYC Recover?

[Lewkowski]

https://www.linkedin.com/pulse/nyc-d...james-altucher

"We are officially AB: "After Bandwidth". And for the entire history of NYC (the world) until now we were BB: Before Bandwidth.

Remote learning, remote meetings, remote offices, remote performance, remote everything.

That's what is different.

Everyone has spent the past five months adapting to a new lifestyle. Nobody wants to fly across the country for a two hour meeting when you can do it just as well on Zoom. I can go see "live comedy" on Zoom. I can take classes from the best teachers in the world for almost free online as opposed to paying $70,000 a year for a limited number of teachers who may or may not be good.

Everyone has choices now. You can live in the music capital of Nashville, you can live in the "next Silicon Valley" of Austin. You can live in your hometown in the middle of wherever. And you can be just as productive, make the same salary, have higher quality of life with a cheaper cost to live. "



The article makes several points (some not very convincing to be honest) but this one I think hits home. There's no need for in person engagement in a lot of jobs now. With bandwidth increasing why would someone want to pay so much more money for so much less space than they otherwise could? Why not "work" in NYC remotely in a place with lower taxes and lower cost of living? If in the post pandemic world we continue to keep a lot of the remote work arrangements (and a lot of people love them) I think cities like NYC are going to face some harsh choices. I can see the hollowing out of cities as the tax base leaves, causing either unpopular cuts in services (hey more riots!) or an increase in the tax rate causing more people to leave.

[Aimless]

This is some genuinely desperate fap.

[RandBlade]

Ignoring Lewk's . . . well ignoring Lewk, its certainly possible that cities are going to be less desirable in the future. In the UK's case its quite possibly a good thing. London is mammothly overcrowded and has been for years, less concentration in London and more across the rest of the nation may not be a bad thing.

[Aimless]

Ignoring Lewk's . . . well ignoring Lewk, its certainly possible that cities are going to be less desirable in the future. In the UK's case its quite possibly a good thing. London is mammothly overcrowded and has been for years, less concentration in London and more across the rest of the nation may not be a bad thing.

People live in or just outside large, dynamic cities for a variety of reasons—and a lack of sufficient remote work facilitation is probably not all that high up on that list of reasons for the vast majority of regular city-dwellers. Once the pandemic is well and truly over, and the economy has recovered, NYC—and London—will both still be at the center of markets that will be more lucrative than they are today. Employers in NYC will be more inclined to offer WFH options that will be enjoyed greatly by their employees, the vast overwhelming majority of whom will continue to live in or just outside NYC. No doubt many will indeed take the chance to leave, but the vast majority will not.

[RandBlade]

People live in or just outside large, dynamic cities for a variety of reasons—and a lack of sufficient remote work facilitation is probably not all that high up on that list of reasons for the vast majority of regular city-dwellers. Once the pandemic is well and truly over, and the economy has recovered, NYC—and London—will both still be at the center of markets that will be more lucrative than they are today. Employers in NYC will be more inclined to offer WFH options that will be enjoyed greatly by their employees, the vast overwhelming majority of whom will continue to live in or just outside NYC. No doubt many will indeed take the chance to leave, but the vast majority will not.

Small percentages can make a big difference. Even if the vast majority do not take the chance even if say just one percent of Greater London's population did take that chance that would be 90,000 fewer people or potentially 40,000 extra homes on the market. That's significant.

[Being]

All large cities are not the same but you might look to Detroit for what changes might come to other big cities if populations decline.

[RandBlade]

All large cities are not the same but you might look to Detroit for what changes might come to other big cities if populations decline.

That won't happen.

That wasn't a minor relieving of the pressure on the city that I am talking about, that was a total collapse. Which won't happen here.

[Lewkowski]

This is some genuinely desperate fap.

I guess it depends on if the NY governor's grovelling works.

https://nypost.com/2020/08/05/cuomo-...return-to-nyc/

"ALBANY — Gov. Andrew Cuomo has been begging rich people to return to New York City from their second-home retreats so they can pay taxes to help offset the state’s growing coronavirus-related revenue shortfall.

“I literally talk to people all day long who are now in their Hamptons house who also lived here, or in their Hudson Valley house, or in their Connecticut weekend house, and I say, ‘You got to come back! We’ll go to dinner! I’ll buy you a drink! Come over, I’ll cook!’” the Democratic governor said Monday.

“They’re not coming back right now. And you know what else they’re thinking? ‘If I stay there, I’ll pay a lower income tax,’ because they don’t pay the New York City surcharge,” he added, noting the wealthiest 1 percent of the Empire State’s population picks up roughly 50 percent of the state’s tax burden.

The plea comes amid dimming hopes that the federal government’s next COVID-19 relief package will contain any additional aid for struggling state and local governments.

If additional dollars don’t come to New York on top of waning revenue streams, Cuomo and other state officials have said the hit could translate to 20 percent cuts to health, education and local governments’ annual budget."

[Timbuk2]

Ignoring Lewk's . . . well ignoring Lewk, its certainly possible that cities are going to be less desirable in the future. In the UK's case its quite possibly a good thing. London is mammothly overcrowded and has been for years, less concentration in London and more across the rest of the nation may not be a bad thing.

Is already happening in my case. With expected new normal seeing a shift away from central office working and toward WFH, we've had our house in the SW London 'burbs valued and will soon put it on the market with us seeking a new life in Brighton on the South Coast. This is the first time in my adult life I will not be living somewhere in London.

Pre-Covid my worklife was 2-3 days per week in the office and 2-3 at home. I anticipate this dropping to 1 day a week or 1 day a fortnight in the office. Commute from Brighton once a week is manageable.

I'm also sensing large global corporates, such as the bank I work for, selling up their enormous skyscraper properties in central city locations and relieving the vast ownership, lease and maintenance costs such properties command. If there is no need to host 10,000 daily workers in a single central city property, why pay for it.

Persinally, we do sense this need now for living in a smaller place. Post covid living will see provision of goods and services more localised, as life has adapted necessarily - and arguably for the better - to cope with lockdown measures.

[Aimless]

Small percentages can make a big difference.

The thread is about whether a city like NYC will recover, with the implication that there might be a death-spiral where the city is hollowed out and turned into some sort of dystopian hellscape. You'll have to consider just what would have to change—and to what extent—for that to become even remotely likely.

Even if the vast majority do not take the chance even if say just one percent of Greater London's population did take that chance that would be 90,000 fewer people or potentially 40,000 extra homes on the market.

1. You should compare that figure to the number of people who migrate to and from London annually, as well as to the number of new taxpayers annually.

2. Your 1% figure denotes 1% of the total population, but the subset of people who would be both inclined and able to move out of Greater London while still working for employers in the city is much, much smaller. 90,000 people would be a much larger share of that subpopulation; conversely, 1% of that subpopulation would be considerably smaller.

I guess it depends on if the NY governor's grovelling works.

https://nypost.com/2020/08/05/cuomo-...return-to-nyc/

"ALBANY — Gov. Andrew Cuomo has been begging rich people to return to New York City from their second-home retreats so they can pay taxes to help offset the state’s growing coronavirus-related revenue shortfall.

“I literally talk to people all day long who are now in their Hamptons house who also lived here, or in their Hudson Valley house, or in their Connecticut weekend house, and I say, ‘You got to come back! We’ll go to dinner! I’ll buy you a drink! Come over, I’ll cook!’” the Democratic governor said Monday.

Wow, you're so stupid it's almost embarrassing. Cuomo is a consistent campaigner for lower or capped taxes, esp. those taxes that primarily fall on the wealthiest New Yorkers; it's absolutely mundane performative politics, partly driven by self-interest, parochial altruism and friendship—Cuomo is relatively wealthy, and many of his friends and connections are exceptionally wealthy. Cuomo is exploiting new circumstances to argue for something he has been arguing for since long before the pandemic came along, and he's not "groveling" before the wealthy but trying to sway the legislature—where there is already support for raising taxes to cushion the blow of the pandemic. Your credulity is genuinely remarkable.

“They’re not coming back right now. And you know what else they’re thinking? ‘If I stay there, I’ll pay a lower income tax,’ because they don’t pay the New York City surcharge,” he added, noting the wealthiest 1 percent of the Empire State’s population picks up roughly 50 percent of the state’s tax burden.

29% of NYC's tax revenue comes from property tax, compared to 13% from personal income tax, where the top 1% of earners account for between half and two thirds of receipts. Do you imagine properties will magically vanish into thin air? To the extent that their owners leave the city, others will move in from elsewhere to take their place—or their properties will be converted to other equally or more profitable assets.

If additional dollars don’t come to New York on top of waning revenue streams, Cuomo and other state officials have said the hit could translate to 20 percent cuts to health, education and local governments’ annual budget."

This is or will be true of every state hit by the pandemic, unless Congress does its job. In other words, it's not particularly unique to NYC, and it's a temporary problem. NY, though it has been hit harder than other states, is better equipped to handle it. How do you think the budgets of Georgia, Kentucky, Alabama, Louisiana, the Carolinas and other net recipients will fare?

NYC is not Detroit, or some backwater redneck shithole populated by people who live in constant fear of foreign food. It's one of the wealthiest cities in the US—and the world—with an extremely diverse and dynamic economy. Yes, the pandemic will change a lot about life in NYC; no, it will not push the city into an irrecoverable death-spiral or anything even remotely close.

[Aimless]

Persinally, we do sense this need now for living in a smaller place. Post covid living will see provision of goods and services more localised, as life has adapted necessarily - and arguably for the better - to cope with lockdown measures.

Get in touch with an innovative architect and build yourselves a luxury high-tech shipping-container villa in Brighton, with floor-to-ceiling windows, solar power, passive temperature control and a great view

[RandBlade]

The thread is about whether a city like NYC will recover, with the implication that there might be a death-spiral where the city is hollowed out and turned into some sort of dystopian hellscape. You'll have to consider just what would have to change—and to what extent—for that to become even remotely likely.

Its not at all remotely likely which is why I started my reply with "Ignoring Lewk's . . . well ignoring Lewk," - but thought it was an interesting topic still so gave a serious response that Tim has then replied to.

1. You should compare that figure to the number of people who migrate to and from London annually, as well as to the number of new taxpayers annually.

Again small numbers make a big difference. If fewer people migrate to London annually going forwards and more emigrate from London then that is not necessarily a bad thing. London is too overcrowded as it stands. The housing market in London is a mess. A total collapse is awful but won't happen, a relieving of the pressure could be good.

2. Your 1% figure denotes 1% of the total population, but the subset of people who would be both inclined and able to move out of Greater London while still working for employers in the city is much, much smaller. 90,000 people would be a much larger share of that subpopulation; conversely, 1% of that subpopulation would be considerably smaller.

Is it much, much smaller? The proportion of people successfully working from home through this is much, much, much higher than 1% - I already went with a smaller figure by saying just 1% there is the potential for more than that. We already have one person on our small forum replying in this thread that it applies to them which is a remarkable coincidence really. Or is it?

[wiggin]

Is already happening in my case. With expected new normal seeing a shift away from central office working and toward WFH, we've had our house in the SW London 'burbs valued and will soon put it on the market with us seeking a new life in Brighton on the South Coast. This is the first time in my adult life I will not be living somewhere in London.

Pre-Covid my worklife was 2-3 days per week in the office and 2-3 at home. I anticipate this dropping to 1 day a week or 1 day a fortnight in the office. Commute from Brighton once a week is manageable.

I'm also sensing large global corporates, such as the bank I work for, selling up their enormous skyscraper properties in central city locations and relieving the vast ownership, lease and maintenance costs such properties command. If there is no need to host 10,000 daily workers in a single central city property, why pay for it.

Persinally, we do sense this need now for living in a smaller place. Post covid living will see provision of goods and services more localised, as life has adapted necessarily - and arguably for the better - to cope with lockdown measures.

My sister in law works for a large American bank; she started her career in Manhattan, then spent several years in London, but now lives in Houston doing much the same work (albeit with a different regional focus). But I wonder how successful she would have been had she never had those formative years in her career to work physically close to her colleagues - getting to know their quirks and strengths, bantering, socializing, and building up the social capital necessary to succeed in a large organization. Her current work arrangement (where much of it is remote) is successful precisely because she already had built up a strong network and a good reputation in the company; her superiors know she's great, and she can effectively work in the organization without being face to face.

I think a lot of desk jobs are like that - even if you can theoretically do the job just fine from anywhere in the world, it's hard to capture some of the subtleties in building a career without some old fashioned time working in close proximity to others.

That being said, it's no secret that there has been a trend for years to shift to more remote working. In the Boston area, there's actually some state subsidies for people to telecommute (mostly because of the costs of congestion and skyrocketing housing prices in the Boston area). Certainly in my company we have some flex work arrangements for people with desk jobs, and all of our contract workers (rather than full time employees) work almost exclusively remotely. Obviously large parts of my company (myself included) will never work primarily remotely since we have R&D and manufacturing operations, but I imagine that our CEO might look more favorably on remote working for others when it makes sense. For big companies, it means they can slim down their office footprint at a significant cost savings.

However. All of this is a fancy way of saying that major chokepoints in urban centers might ease up a bit as more people work remotely. But I don't think we're going to see wholesale exoduses from some of the highest demand metropolitan areas, just perhaps a diffusion to a slightly wider area (this already happens; my colleagues live spread across 6 states but still commute semi-regularly to the office pre-COVID). Years ago economists had predicted that with improved telecommuting options, you wouldn't get clusters of industries that create these supercities, since it doesn't matter where you live or work. But that prediction hasn't panned out - in fact, paradoxically, the internet made things cluster even more into just a handful of major cities in the US. The jury's out on why this happens, but people have speculated about the intangible value in clustering on e.g. having a common pool of human capital. I doubt COVID will succeed where a secular trend has failed.

And we forget that people don't just live in supercities because of their jobs but because they're, generally, nice and exciting places to live (much as it pains me to imply that about NYC). There's great cultural amenities, a diverse and rich array of experiences, and social opportunities that might not abound in a more boring (albeit more affordable) alternative. I can tell you that even in my current metro area, I have a choice of either living in a really nice town at the urban/suburban divide, with all of the transit and cultural amenities of the city (at the cost of very expensive housing and some congestion) or moving to a boring commuter town 45 minutes outside of town (where the biggest attraction is - I swear to God - a pond). The commuting costs and times wouldn't be all that different for me and my wife, and we could buy a gorgeous house for half the cost of a modest one in the city. But every time we visit this commuter town to see friends or look at a home, we take a look around and realize that we're not even close to ready to make that kind of sacrifice. Moving to a place that wasn't even commuting distance to these kinds of amenities (like a middle of nowhere town) would be even more difficult.

I'm not worried about NYC anytime soon.

(As an amusing aside, I was rereading some old William Gibson novels from the 80s. And it's really fascinating to see what people imagined the future would be 30-40 years ago. There's the pervasive assumptions about the Japanese running everything, the dystopian views of government and mega-corporations, etc. But one thing that struck me was a sequence in Count Zero where it becomes clear that all of the office space in e.g. Manhattan has been converted into residential housing, since the rise of cyberspace has made physical offices obsolete. I wonder what a 1980s Gibson would think about 2020 and if he'd be dumbfounded that commercial and industrial spaces in high rent cities has gotten even more exclusive and expensive.)

[GGT]

Of course NYC will recover....once the virus is no longer a threat. That's true for most large cities that rely on travel, tourism, entertainment, and hospitality -- things that can't be done remotely but rely on experiencing something in real time. Like live music, Broadway plays, historical tours, museums, dining at a restaurant.
Even gambling and shopping can be done on the internet, but it doesn't have the same feeling as in-person participation, immersion, ambiance.

That's why people travel. Not just to the closest "big city" but all over the world. Unfortunately, millions of jobs *can't* be done remotely, and the pandemic has ruined plenty of small businesses, communities, and individuals waiting for the virus to be contained. A large number of independent restaurants (30%?) have gone out of business, along with mom 'n pop shops, boutique hotels, and everyone in their vendor/supply chain. Those are the JOBS to worry about. They don't get the big relief packages like the airlines or mortgage companies, but they're what makes a place nice to live in and/or visit.

[Dreadnaught]

To say this will kill cities is a-historical, as there have been far worse plagues to afflict cities. Cities fundamentally work for organizing large segments of society in "normal" times.

White collar work is possible to do remotely pretty well, but it's not long-term sustainable as a 100% solution for many companies.

That said, cities will face enormous fiscal challenges. NY relies enormously on a small slice of wealthy people who will only accept being soaked so much. Property taxes can be contested in courts as valuations fall. The left-wing hajira of big-city liberal government will have to face some reality.

[Lewkowski]

A lot of you are arguing against something I've not suggesting. NYC isn't going to disappear, hell even Detroit still exists. The question is will it regain its luster? Will crime go back down? Will it resemble NYC of the 70s or will it resemble the 90s?