I have heard a large impetus for the RTO push was to prop up commercial real estate. Permanent WFH would change the value of trillions of dollars of properties and reshape the commercial centers of cities.
A lot of people with a lot of money at risk got really scared and decided the easiest thing to do was to go back to the status quo.
The incongruent part of that theory is that the RTO push came from middle to upper-middle management (and some top-level ones on occasion).
The owners of commercial real estate are not these people. And it doesn't seem likely that these commercial real estate owners would have sufficient push by themselves to make such a large scale RTO mandate.
It came from the very top. The owners own both real estate companies and software companies and much in between. Many also copied the RTO directive to fit in.
>I have heard a large impetus for the RTO push was to prop up commercial real estate. Permanent WFH would change the value of trillions of dollars of properties and reshape the commercial centers of cities.
That makes as much sense as "people buy iPhones because they own Apple shares in their 401k (it's #2 in the S&P 500) and want to pump the stock". At an individual CEO level it doesn't make sense, for similar reasons. The CEO and the company can reap massive savings from not leasing an office, which is presumably also good for their careers and make the board happy. On the other hand the individual benefit that the CEO can get by ever so slightly increasing demand for CRE is negligible.
Those CEOs don't exist in isolation. There are boards of directors. Most tech companies have additional VC funding. The biggest myth of modern business is that the CEO is the boss. They're not. They're more often the person entrusted to curate the company which is ultimately for the interests of those who own it.
And those people own other things too. Sometimes they own commercial real estate directly. Sometimes they're just investing in it. But they all rub elbows with those who do own it. They sit on boards together. They have common interests and let me tell you -- those interests ain't about what's good for you and me.
Yep watch the economic forums if you want to get an insight into how these people think. They will absolutely be excited about AI but be a B2B SaaS that sells by the seat. They will move against their own interests if it in the pursuit of the next quarter regardless of long-term though.
There were a lot of downstream effects as well -- local businesses that depended upon those office workers being in the area. Those ripples hurt a lot of people.
That said, it shouldn't be the driver of RTO, it should be the need to actually have in-person collaboration.
A win-win in this regard would be to repurpose the empty office space into living spaces so that the local businesses would have local people and those tenants would be able to possibly abandon the need for car ownership if the density of the area fosters all the necessary services.
The smackdown of this idea is that office spaces have different requirements than living spaces and the conversion of those buildings is too expensive to make it viable. As an unrepentant optimist, I would hope that could be mitigated by supporting those transitions via tax rebates, collaborative zoning and permitting processes, and investing in methodologies that could address the infra needs (plumbing, etc).
A lot of people with a lot of money at risk got really scared and decided the easiest thing to do was to go back to the status quo.