Will They Ever Return?

eolesen wrote: ↑Fri Jun 02, 2023 7:43 am Not sure what the fascination with the unemployment rate is when discussing knowledge workers. Those are the ones who are never coming back to the cities, and the ones most likely to live further out.

Does the unemployment rate not include them?

My point is that people can say whatever they want on a survey, yet the numbers on the ground don't show any kind of mass exit from the job market "just because my boss told me to come to the office".

They might be coming into the office only 3 days a week, and it's possible that some companies are still being lenient about the return. But let's not pretend like all knowledge workers are now working from home and will continue to do so forever. Those are simply not the facts on the ground.

Today's 8.25 LIRR arrival into NYP had no empty seats and that's even with some of the worst air quality NYC has seen in recent history.

lensovet wrote: ↑Wed Jun 07, 2023 9:18 am Does the unemployment rate not include them?

Honestly, probably not. The gig economy for knowledge workers isn't new, and that's where the largest contingent of remote workers will always be. Companies simply don't add permanent workers when a contractor will do and is easier to get in place on little notice, and easier to cut when the work is over & done.

And gig workers won't show up in unemployment numbers because they're not filing for unemployment, and the whole notion behind gig work is you work when you want/need to, not because you have to.

lensovet wrote: ↑Wed Jun 07, 2023 9:18 am My point is that people can say whatever they want on a survey, yet the numbers on the ground don't show any kind of mass exit from the job market "just because my boss told me to come to the office".

You're focused on the wrong metrics. It's not about who is on the train at 8am or what's going on in the overall job market.

The impact from WFH is loud and clear in other factors: commercial vacancy rates for office space, the number of adjacent space businesses that have closed up e.g. dry cleaning, convenience stores, and bar/restaurants that rely on lunch and happy hour traffic in business districts.

---> https://www.nytimes.com/2023/05/05/nyre ... rates.html

Even downtown residential vacancy rates are a sign in places where you don't have an overall housing shortage or rent controls that people are grandfathered into and afraid to give up. Lots of residential vacancies in near downtown Chicago because people moved out of the city due to reduced presence in the office. I'm sure increasing violent crime rates haven't helped either.

Some still are placing "big time bets":

Wall Street Journal

Fair Use:

Employees frequently cite the dreaded commute as their biggest reason for avoiding the office. But one of America’s most prominent landlords is featuring the commute as a selling point for a 9-million-square-foot real-estate project surrounding Manhattan’s Penn Station.

Vornado Realty Trust is spending $1.2 billion overhauling two of its office buildings near the midtown transit hub, which serves commuters from several subway lines, Long Island, New Jersey and, starting in 2027, Westchester County, N.Y., and Connecticut.

“We think this is the most important development in the city and perhaps way, way beyond the city,” the New York firm’s chairman, Steven Roth, said in an interview.

Roth told Vornado investors that Friday office work is “dead forever” and “Monday is touch-and-go.” But he believes workers will continue to commute a few days a week so long as it is an easy journey. He calls train rides to Penn Station a “one-seat commute” because office employees won’t then need to take the subway to their offices.

Please pardon one more anecdote: my wife I and went to a wedding on Long Island a few weeks ago, and the train we rode from Penn Station to Central Islip on a Friday afternoon was ten or twelve cars and standing room only. I was expecting empty seats and expecting the train to empty out as it went east, but it was still almost full when we got off.

I find it interesting that April was the last time LIRR and MNRR traffic recovery was announced by press release, then at <60% of 2019 levels.

The daily data indicates both are closer to 70-80% of 2019, but their own growth projections were 4% annual growth pre pandemic... so is it 80% or is it really 66% if you factor in the growth that should have occurred?

You'll see the full trains at peak, but it's the rest of the day that are emptier.

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eolesen wrote: ↑Thu Sep 28, 2023 9:26 pm You'll see the full trains at peak, but it's the rest of the day that are emptier.

and this is different from pre-pandemic how exactly?

I've seen morning Keystones be SRO in the past few weeks.

Looks like you can see the pre-pandemic comparison here https://data.ny.gov/Transportation/MTA- ... /vxuj-8kew

Definitely a strong Tu-Th trend on the weekdays, and pretty full recovery on weekends on LIRR. Weekend ridership on MNRR is weaker. Subway recovery is weaker still, with bus ridership the hardest hit.

One more casualty showing they're never coming back:

https://www.nbcchicago.com/news/local/s ... g/3238322/

I've been there - well when it was The 95th atop the John Hancock; must say quite the view.

eolesen wrote: ↑Thu Sep 28, 2023 9:26 pm I find it interesting that April was the last time LIRR and MNRR traffic recovery was announced by press release, then at <60% of 2019 levels.

The daily data indicates both are closer to 70-80% of 2019, but their own growth projections were 4% annual growth pre pandemic... so is it 80% or is it really 66% if you factor in the growth that should have occurred?

You'll see the full trains at peak, but it's the rest of the day that are emptier.

Earlier, I said (if I remember correctly) that pre-pandemic levels were usually over 100% of capacity, with crush-loads of trains that you did not even have standing room... and post pandemic you'll probably get a seat but it'll be a full (with SRO) train.

We're seeing that now. Not quite packed to bursting but still, all seats taken. We're seeing what 80% of regularly over 100% capacity is.

Gilbert B Norman wrote: ↑Fri Sep 29, 2023 6:03 am One more casualty showing they're never coming back:

https://www.nbcchicago.com/news/local/s ... g/3238322/

I've been there - well when it was The 95th atop the John Hancock; must say quite the view.

This is off topic (wrong city) and I don't think the Signature Room clientele really represents the rail-riding public. More the sort of people who would get an Uber Black everywhere without looking at the price.

Andrew, my immediate was posted to show that the operators of this high end restaurant (it's really quite good - or at least when I was there) are accepting that 2019 office occupancy, and the related hospitality industry, is simply never coming back.

On that point, there are reports that METRA ridership is 51% of pre-COVID level.

Finally, for the benefit of one who has never used Uber (or Lyft), I presume Uber Black is some kind of Livery Car Service they offer.

Gilbert B Norman wrote: ↑Sun Oct 01, 2023 1:54 pm Andrew, my immediate was posted to show that the operators of this high end restaurant (it's really quite good - or at least when I was there) are accepting that 2019 office occupancy, and the related hospitality industry, is simply never coming back.

On that point, there are reports that METRA ridership is 51% of pre-COVID level.

Finally, for the benefit of one who has never used Uber (or Lyft), I presume Uber Black is some kind of Livery Car Service they offer.

Well, there will be some change when you have such an upheaval. Go back to Baltimore, a lot of independent coffee shops and restaurants have closed for good. Offices are being abandoned, and there's not much of a draw there now. It may take a decade or more to fill them back up, and said businesses that depend on that office traffic can't hold out that long... if they have so far.

We see that in Chicago now with the Signature Room. I found their menu back in 2019, and at the time, it would be an easy $100 a plate before you get to the wine. It's definitely high-roller territory -- if they didn't have their own car and chauffeur, they would Uber Black or Lyft Lux Black -- basically for-hire limo service. A tourist is spending $1K or more to do that.

Which gets back to the commuter trains. If you're a high roller, you're not taking a commuter train with the white-collar riff-raff. No, you're taking your personal helicopter in to a private landing pad, going down to meet a hired limo, over to dinner, a show, then back by said limo or limo-flight combo. Lets cut that top-end out of the conversation... and the top-tier restaurants that charge north of $80 per plate. (Although, it would be nice to win the lottery, get fixed up, and meet the gospel singer that shares my first and last name for a dinner and a play...)

So what's left? What would draw people in on a regular basis to the cities, requiring the use of transit because sheer bulk of people?

In New York, you have Wall Street and the stock markets (although that's mostly electronic now), plus the UN.
In Washington, you have the federal government.
In Chicago... maybe the mercantile markets? But most of that's electronic.
In Seattle and San Jose, you have the tech sector, and even they are mostly hybrid.

Lets answer the question of the thread again. Will they ever return? As I said before, yes. But it's not the "they" we had pre-pandemic, and it's going to take a while.

Here's more from The Journal supporting what I think we all know around here is the case:

Fair Use:

First, the good news for office landlords: A post-Labor Day bump nudged return-to-office rates in mid-September to their highest level since the onset of the pandemic.

Now the bad: Office attendance in big cities is still barely half of what it was in 2019, and company get-tough measures are proving largely ineffective at boosting that rate much higher.

Indeed, a number of forces—from the prospect of more Covid-19 cases in the fall to a weakening economy—could push the return rate into reverse, property owners and city officials say.

More than before, chief executives at blue-chip companies are stepping up efforts to fill their workspace. Facebook parent Meta Platforms, Amazon and JPMorgan Chase are among the companies that have recently vowed to get tougher on employees who don’t show up. In August, Meta told employees they could face disciplinary action if they regularly violate new workplace rules.

Again allow me to reiterate, that this will impact mass transit nationwide far more than the closing of The 95th will have upon the Chicago elite class.

Gilbert B Norman wrote:
Again allow me to reiterate, that this will impact mass transit nationwide far more than the closing of The 95th will have upon the Chicago elite class.

But will it? Meta and Amazon are not mathematically significant in NYC, BOS, CHI, or even WAS, which are the largest commuter cities.

JPMC is headquartered in NYC, but that's a symbolic footprint of a couple thousand (e.g. they have more people in Columbus, OH than NYC).

My downtown Chicago headquartered company just bought a second suburban office building that will be almost exclusively hoteling space. At 205,000 feet of office space, its equal to four floors at Willis, except it also has 1500 parking spaces. Its perfect for those teams who have people living in the suburbs and need face time one or two days a week...

It's nowhere near a bus route to a Metra station, either...

Between Covid initiated remote work policies becoming more of a norm than not, and the impact of crime in the cities (not to mention eliminating cash bail), it's a bad time to be a landlord with downtown properties.

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I'd just like to remind everyone that we're in the NYC forum, not the Chicago or Metra forum.