Dropbox Returns Over 25% of Its San Francisco HQ to Its Landlord (cnbc.com) 66
"Dropbox said Friday that it's agreed to return over one quarter of its San Francisco headquarters to the landlord," reports CNBC, "as the commercial real estate market continues to soften following the Covid pandemic."
The article notes that last year Dropbox's accountants declared a $175.2 million "impairment" on the office — a permanent reduction in its value — calling it "a result of adverse changes" in the market. And the year before they announced another $400 million charge "related to real estate assets."
Friday CNBC reported: In a filing, Dropbox said it agreed to surrender to its landlord 165,244 square feet of space and pay $79 million in termination fees. Under the amendment to its lease agreement, Dropbox will offload the space over time through the first quarter of 2025. Since going remote during the pandemic three years ago, Dropbox has been trying to figure out what to do with much of the 736,000 square feet of space in Mission Bay it leased in 2017, in what was the largest office lease in the city's history. The company subleased closed to 134,000 square feet of space last year to Vir Biotechnology, leaving it with just over 604,000 square feet...
"As we've noted in the past, we've taken steps to de-cost our real estate portfolio as a result of our transition to Virtual First, our operating model in which remote work is the primary experience for our employees, but where we still come together for planned in-person gatherings," a company spokesperson told CNBC in an emailed statement... Dropbox's 2017 lease for the brand new headquarters was for 15 years... "As a result of the amendment the company will avoid future cash payments related to rent and common area maintenance fees of $137 million and approximately $90 million, respectively, over the remaining 10 year lease term," Dropbox said in Friday's filing.
A short walk away from Dropbox, Uber has been trying to sublease part of its headquarters.
The article also notes that San Francisco's office vacancy rate "stood at 30% in the third quarter, the highest level since at least 2007, according to city data."
The article notes that last year Dropbox's accountants declared a $175.2 million "impairment" on the office — a permanent reduction in its value — calling it "a result of adverse changes" in the market. And the year before they announced another $400 million charge "related to real estate assets."
Friday CNBC reported: In a filing, Dropbox said it agreed to surrender to its landlord 165,244 square feet of space and pay $79 million in termination fees. Under the amendment to its lease agreement, Dropbox will offload the space over time through the first quarter of 2025. Since going remote during the pandemic three years ago, Dropbox has been trying to figure out what to do with much of the 736,000 square feet of space in Mission Bay it leased in 2017, in what was the largest office lease in the city's history. The company subleased closed to 134,000 square feet of space last year to Vir Biotechnology, leaving it with just over 604,000 square feet...
"As we've noted in the past, we've taken steps to de-cost our real estate portfolio as a result of our transition to Virtual First, our operating model in which remote work is the primary experience for our employees, but where we still come together for planned in-person gatherings," a company spokesperson told CNBC in an emailed statement... Dropbox's 2017 lease for the brand new headquarters was for 15 years... "As a result of the amendment the company will avoid future cash payments related to rent and common area maintenance fees of $137 million and approximately $90 million, respectively, over the remaining 10 year lease term," Dropbox said in Friday's filing.
A short walk away from Dropbox, Uber has been trying to sublease part of its headquarters.
The article also notes that San Francisco's office vacancy rate "stood at 30% in the third quarter, the highest level since at least 2007, according to city data."
A cynical reading of CNBC's intent (Score:4, Interesting)
as the commercial real estate market continues to soften following the Covid pandemic."
- 1). Don't use crisis language to describe the crisis, that'll upset advertisers trying to sell their illiquid assets before the worst of the crisis reveals to suckers they're in a crisis going into a worse crisis. Use soften SOFTEN. We can't get sued because it's a meaningless word in this context. Remember: more meaningless if it means less legal liability.
- 2). Ignore what epidemiologists are saying about the pandemic. Remember, if they don't agree with the advertisers they're literally not experts. Advertisers say we're post-pandemic, so we're post-pandemic. This happening is FOLLOWING the pandemic.
- 3). One crisis at a time. No crisis ever arrives without any earlier ones happening simultaneously passing. We can always say "this has never happened before!".
When the reporting of what is happening isn't sufficient detached from the financial interests impacted by what's happening then the reporting is just a lever for the financial interests to pursue their interests. To think otherwise is to pretend in other systems, like say the Soviet union, never used propaganda in reporting that concerned economics.
Re: A cynical reading of CNBC's intent (Score:1, Funny)
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Those of unrelenting ignorance. Where is your faith? Have you no Five Eyes?
That's no mere country falling over. It's the lead domino. Upon us indeed. Arrogance is silly enough to become our epitaph. No borders needed.
Make it 12? That's no way to start a dictatorship, because self-inflicted national emergency. Pray on your shortsighted sins.
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My view is 2 different systems will find utility in the same method (propaganda, or PR if you prefer to call it; Bernays acknowledged it as the same thing) for different ends concerning a common problem (the outcomes of economic decisionmaking with asymetry of information; the separation of those-in-the-know from others).
Wilfully misinterpreting that CNBC is a contemporary US president that is also a US president during the cold war that is also the Soviet premier is a series of mental gymnastics you didn't
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There was little to interpret when watching the verbal gymnastics of mainstream media speaking in unison, all parroting the exact same key phrase of the day, only speaking on what they've been approved to speak on. Tends to send Soviet chills down Freedom's spine when you watch it in real-time, since no amount of statistical analysis is necessary to calculate the chances of verbal synchronization like that. Daily.
Watching a two-party system today create Weapons of Mass Distraction behaving as politicians
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behaving as politicians instead of Representatives
We live in a system where our representatives are incentivized by trying to win re-election or the threat of ouster, this is what drives their decisions, it's how it's supposed to work. This statement is just empty populism. If you don't think your Representative is representing you you get to try and replace them every 2 or 4 or 6 years.
Facts don't give a fuck about insincere feelings.
This applies to every single thing you said as well, plus you gave 0 examples. Meanwhile the the best example we have of media unison comes from Sinclair media, an extr
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behaving as politicians instead of Representatives
We live in a system where our representatives are incentivized by trying to win re-election or the threat of ouster, this is what drives their decisions, it's how it's supposed to work.
Supposed to...those creating the definition of Representative when drafting the founding documents were all about...pimping re-election? Didn't think I would actually find an interpretation worse than what we've done with the 2nd, but I think I just did.
This statement is just empty populism. If you don't think your Representative is representing you you get to try and replace them every 2 or 4 or 6 years.
Ironically enough, Learn to Vote Better at all levels of government is a concept I've been preaching to the regret-addled for a while now. Sadly this should include raising the voting age. College has solidified the fact that children are still walking t
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those creating the definition of Representative when drafting the founding documents were all about...pimping re-election?
Yes, actually in a "consequences at the end of the day", as we are like to say this is a feature, not a bug.
Sadly this should include raising the voting age
Sure, so long as you are comfortable raising the age of adulthood on everything in kind, smoking, drinking, military, driving, parental dependency, etc. We have generally agreed 18=adulthood. It's not true for everyone, some mature faster, some slower but that's the generalization of it, at some point we just have to call a number. I think 18 is fine for voting, if anything a case for making it you
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You know I am not opposed to this, although I would expand it to include other types of public service rather than military, even creating new public service areas specifically for this. I think putting a couple years into helping your community is actually better than just military service, the military themselves prefer the volunteer army over having to deal with a bunch of mandated randoms.
Of course this is all fantasy until a Constitutional amendment is passed to such effect.
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You've met far more older people who know how dumb they were at 18
Maybe, but not as many as you'd hope.
Do you have anything other than "it feels like 18 is to young to vote" before we go an disenfranchise a massive part of the voting population. This is still just paragraphs hypotheticals, vibes and your grievances against the young people of today.
You've got Fox News and perhaps one or two others on the conservative front, facing off against the literal rest of mainstream media that parrots a very consistent narrative provided to them.
Oh be quiet, this canard doesn't work anymore when you have dozens of very large conservative media outlets (do you want me to ramble off a dozen right now?), 3 cable new networks and continuing dominance of local talk radio a
Re: A cynical reading of CNBC's intent (Score:2, Insightful)
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So far as I am aware, the more recent waves of COVID are significantly smaller in terms of cases that require medical attention and cases that result in death. It's still there, people are still dying, but we're past the "build emergency tents in the hospital parking lot and hope the nurses don't die too quickly" stage.
Short of mandating universal vaccination for all but those who have a legitimate medical reason not to be vaccinated, this is life now. (I support mandated vaccination, by the way. It's a
Re: A cynical reading of CNBC's intent (Score:1)
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You are simultaneously asserting it is over and it is not over and will be around indefinitely like influenza.
Asserting the second without the first is a view I can't dismiss, but both together just reads as confusion. My problem is that mass media pursue a strategy of flipflopping for selfish (and shortsighted) reasons creating new harms and perhaps even new crises because of bad decisions made from preventable deliberately sewed confusion.
Re: A cynical reading of CNBC's intent (Score:1)
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>They can put four different strains of flu in one shot, they can do it for covid
Yes, but we can't apparently make people take the shot. You have the right to be a fatal disease carrier and put all your fellow citizens at risk.
Anti-vaxxers ought to be locked in their homes with a big 'quarantine' sign nailed to the front door until they comply.
Re: A cynical reading of CNBC's intent (Score:5, Informative)
You do not understand how vaccines, viruses, and the human immune system work. And you may have an insufficient grasp of statistics and probability.
Vaccines alter your odds. Vaccination rates affect odds of exposure.
They are not 100% effective, but they are far, far better than not using them.
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At this point I can't really have an issue with people making the personal decision to not vaccinate.
However where my issue stems from is those same people either being woefully misinformed about the vaccine or (usually) just straight up lying about it, whether that's about efficacy or side effects or down to the crackpot 5G-WHO-Fauci conspiracy because that rhetoric does endanger us not just in this pandemic but the next one or whatever next natural disaster befalls us.
In this case your personal choice is
Re: A cynical reading of CNBC's intent (Score:2)
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My friend's wife can't be vaccinated for measles. Other vaccines work for her, but not the measles vaccine. For whatever reason, she does not generate any antibodies, so when they test her, it's like she's never been vaccinated.
Of course, that's an issue with her immune system, but it immediately puts the lie to the claim that 'the shots either work or they do not'. So in some cases, vaccines might not work for everyone. Indeed, we know that some people are allergic to the shots entirely. There's a whole ca
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If she wants a shot again, she perhaps should mention which ones she already got before.
The point is that many vaccines use an artificially mutated virus to put the DNA - that is the actual vaccine - into your body. See: https://en.wikipedia.org/wiki/... [wikipedia.org]
Traditionally that is an Ardeno Virus, 5 or 6 strands are used for old vaccines, e.g. against Measles.
If she got once an Ardeno-Virus-1 vaccine against X, then he has not only antibodies against X ready, but also against Ardeno-Virus-1.
So, if she now gets an
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I am not. I'm saying it's not as severe as it was and everyone's just accepted it.
It's 'over' in that it is the new normal and that's not going to change any time soon.
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Over or every one accepting it: in your country.
It is neither over in my home country, that just ordered millions of shots from the brand new vaccines,
nor in Thailand, where I live, and everyone in a "many contacts per day" position is wearing masks. Same for public transport, taxi and what ever.
It is long from over, and most certainly not "accepted". We do what we can to protect each other.
If the next wave here is like the previous ones: everything big will be closed again. E.g. every shopping mall.
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this is life now
I mean yes and no. We're still going to have COVID just like we have flu, but like flu outbreaks and flu pandemics, we're having a COVID pandemic. We're still having the hallmarks of a pandemic in COVID.
With flu infections when they happen, if the spread rate is high enough to maintain a continuous spread of wide areas, that's a pandemic of that flu,
Re: A cynical reading of CNBC's intent (Score:5, Informative)
The pandemic is over, however. Pandemic requires that it be an 'outbreak' and after four years, it's hard to call it an 'outbreak' anymore. It's now endemic. That doesn't mean it's trivial (HIV and Malaria are also endemic), but simply speaks to newness or increased spread compared to a baseline.
That doesn't mean everyone stopped fighting it (obviously, HIV and Malaria are constantly being researched to improve outcomes). It does however suggest that strategies to fight have to be sustainable. When it was a sudden pandemic with ill defined treatment protocols and no preventative measures, then we did unsustainable things like shut down pretty much everything. Makes sense as you need to throttle demand on health care system and give the medical community time to ascertain the best strategies.
Now we have those strategies. Vaccines, medicines, and treatment protocols have been developed. Most people have been infected at least once by now. Unfortunately it's still a quite serious disease despite it being much less severe than it was in 2020, however we can't shut everything down indefinitely. One could argue that things like increased WFH are sustainable and can mitigate disease spread (not just covid, but flu) as well as other benefits around energy use and greenhouse gas generation.
it isn't over (Score:1)
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What makes a crisis a crisis is that your systems aren't prepared to handle it. In 2021, COVID was still only the third most common cause of death in the US, but COVID was a crisis and heart disease and cancer were not. That's because we were prepared for the predictable levels of heart diesease or cancer. We weren't prepared to handle COVID patients. Remember "flatten the curve"? The *area* under the curve was never going to change -- i.e., everyone was still going to get COVID eventually -- the critic
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i.e., everyone was still going to get COVID eventually --
That is simply wrong as SARS and MERS showed.
If you flatten the curve quick enough: the virus stops spreding and dies out. That is the point.
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- 1). Don't use crisis language to describe the crisis,
It is wholly appropriate in this case. The situation as it stands is that commercial real estate investors are stuck with a glut on the market. Unfortunate for them, but hardly constitutes a 'crisis' with respect to the wider audience. If they did call it a crisis, a fair number of people would decry them for being melodramatic about the woes of largely unsympathetic commercial real estate owners. If you have commercial real estate to sell, the prospective buyers already know your predicament, whether CN
The real reason (Score:2)
For return to office Mandates. Busineeses sign 5- 10 year lease agreements and are stuck with huge penalty clauses. Aince they dont want to take the loss they make employees return to empty offices having sold the furniture to pay rent.
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Well, that actually is the real reason. You only have to look around who are badgering their workers the most to return to the open floor hell. It's companies that own their very own huge "office campuses", from Apple to Amazon.
This is not about the performance of the employees, this is about the performance of the stock.
Re: The real reason (Score:1)
It may be, but in a number of cases itâ(TM)s because itâ(TM)s easier to manage secrecy when you arenâ(TM)t online and some teams really donâ(TM)t work well when people arenâ(TM)t sharing the same physical space.
Iâ(TM)ve found that certain people are dealing with an increased derision depression rate, due to isolation, while wanting to say how great remote work is. Remote work isnâ(TM)t for everyone and probably works best when you can just pull out for a quick walk to a l
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I don't see the secrecy argument. I work in a fairly security-conscious company where secrecy is key. It is absolutely possible to ensure secrecy as much from remote as it is from the office. If you cannot secure the connection between your remote workers and your office, you're fucked either way because that also means you can't secure the connection between your office and wherever your storage is located.
That argument is weak.
As for depression, that may be the case. But I can also tell you with some conv
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Not to moderators: just because you disagree with a perspective doesn’t make the comment a troll. It would be better to hear your counter argument than just applying the equivalent of “cancel”.
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For return to office Mandates. Busineeses sign 5- 10 year lease agreements and are stuck with huge penalty clauses. Aince they dont want to take the loss they make employees return to empty offices having sold the furniture to pay rent.
Nice, but I'll give you half-credit on that one.
The other real reason, is a corrupt real estate market that felt justified in charging a 5 - 20x premium for "commercial" dirt, with an market dumping a lot of pension plans into real estate investments. Now it's not merely a matter of lease penalty clauses. Get your ass back in that overpriced office pleb, else your pension fund disappears. Like the building, business has middle-earth cube farmers to pointlessly re-justify in a post-COVID WFH world too. Y
Re:The real reason (Score:4, Interesting)
Note that the penalty clauses wouldn't trigger if the company kept paying for an empty buliding.
You are right that a lot of these companies are stuck with a commercial property, whether stuck in a long term lease or they own it out right in a market with no buyers. However I don't think it's about empty buildings somehow being more expensive than a full building (technically, the opposite is true, an empty building requires less maintenance, janitorial services, etc). It's because they "might as well use it" since they have it, and if they go in and don't see a sea of busy bees working for them, well that feels wrong. They want people in because they don't trust people to maintain work-focused discipline unless they are at risk of being casually observed to be doing non-work related stuff. Part of this is rooted in the truth that they have no idea how to measure the productivity of an employee. They frequently don't understand the relative difficulty of a job (that's why they pay other people to do it after all) and in a WFH, they have to have completely blind trust that the employees accurately represent the difficulty/productivity of their work, whereas in person, well, they are still susceptible to misrepresentation, but they feel it's harder to pull off in person.
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Very few companies actually buy real estate.uned the company brand. The usual trick is for an office or executive to buy property and improve it to client specs for a long lease. The business pays for the improvments taxes etc and then pays a rent back to the actual owner.
That is why commerical real estate gets valued souch more it is basically work free contracted income.
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Perhaps more to the point, some executive made a decision to lock the company into that situation for many years. If the office is full they look like a genius. If it's empty they look like idiots that flushed a big pile of future dividends down the toilet.
Guess which one they would rather be. They will do any amount of contortions necessary to make sure people don't think they're dividend wasting morons.
Never forget, Machiavellian executives act for their own personal best interests first. Any duty they ma
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Nah, that's not it.
Your manager missed seeing your smiling faces hanging around the office coffee bar. /s
For once they deserve their name (Score:2)
Dropbox [...] agreed to surrender to its landlord 165,244 square feet of space
They sure dropped one big box...
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They were probably feeling a bit boxed in with the ongoing losses on their office space. $79 Mil to get out is a drop in the bucket by comparison to what they lost over those two years mentioned in the summary.
Confusing vacant and vacant is confusing (Score:3)
Incubate Biotech (Score:2)
DropBox (Score:1, Interesting)
I don't know why they have so many people working for them.
I've built a file/picture sharing app before, and aside from scaling it to globally-distributed cloud-based platform, there is absolutely no reason to have more than a 100 remote engineers, period.
How they manage to squander so much money is some next-level shit.
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aside from scaling it to globally-distributed cloud-based platform
This is precisely why so many people are needed. Scaling is *the* most difficult problem when it comes to software development.
Did you ever do load testing on your app? How did it perform with 100 simultaneous users of a single shared file? How about 1,000 or 100,000? My guess is that no load testing was performed, and that if you did, it would fall over with only a few simultaneous users. This is the typical pattern with load testing, the first run generally fails under the load of just a few dozens of use
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Its amusing watching someone explain to me my job for the last decade.
Carry on.
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If that's really true, then your original post makes zero sense. If you have really dealt with the kind of scale Dropbox deals with, you'd know exactly why Dropbox has to employ so many people.
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I know exactly why they employ so many people, and it has nothing to do with engineering.
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OK smart one, tell me what it has something to do with, if not engineering!
What's over 25%? (Score:2)
27%? Something? Why not give the real number?
Homeless (Score:2)
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Oh damn (Score:2)