Santa Monica real estate won't fall this time because we have all these new high-paying jobs, right?
Oops. "Yahoo to lay off 1,000 workers" said the LA Times's headline last Wednesday. Expanding in Santa Monica was Yahoo's strategy to make money from new Hollywood-based content.
Now Microsoft proposes to buy Yahoo. What happens to jobs at bought companies? Not to mention the prospects of one big lagging company buying another are not good; especially when their cultures are so different; plus EU antitrust regulators are involved (John C. Dvorak).
Added link: Mish on "Microsoft Panics, Overpays for Yahoo".
OT, but a quote I don't want to miss from Charles Hugh Smith:
"Economic history is a never-ending series of episodes based on falsehoods and lies, not truths. It represents the path to big money. The object is to recognize the trend whose premise is false, ride that trend, and step off before it is discredited." (George Soros)
Saturday, February 2, 2008
Yahoo!
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22 comments:
There aren't going to be any layoffs at "our" Yahoo--that's because Santa Monica is special.
Haven't you heard?
LOL!
I agree that the yahoo people will be laid off and will no longer be able to afford to live in 90403
Let me bring over to this board something i saw on SM distress
___
Anonymous said...
Santa Monica has gone through a paradigm shift.
If you talk to the older generation, the people that moved to Santa Monica in the 1940's, they remember a 90402 where any unionized factory worker could afford to move. They were shocked when the unionized factory workers were priced out of the 90402
Now, you can talk to people who remember 90402 from ten years ago when the average doctor or lawyer or CPA could afford it -
there is a paradigm shift that many people on this board haven't yet accepted
Let's look at the walk streets of 90402 - i think someone told me there were three thousand houses in those streets - from the ocean to 26th between san vicente and montana
let's say that 100 of those houses hit the market each year -
let's say those houses sell for an average of $3 million today
are there more than 100 buyers ready willing and able to pay $3 million in 2008 and 2009 or will there be a shortage?
Markets are determined on the margin - certainly there are not 3000 people ready willing and able, but the prices are determined by the ones that actually hit the market
Paradigm shift, what a load of B.S.
Real estate agents are trying to use academic speak to convince everyone that this BUBBLE was "different" than all of the other bubbles in history.
THE CRASH HASN'T EVEN BEGUN IN THE WESTSIDE!
You would have to be STUPID to buy anything right now.
Here is what the bulls won't tell you...Q4 commercial real estate stats for Santa Monica:
Net absorption was negative in a number of submarkets, including Santa
Monica (-160,500 SF), where Yahoo returned “must-take” space that they never occupied in the Yahoo Center to Equity Office.
I think this is pretty much a wash: Yahoo is declining in SM, but MySpace is growing like crazy and probably going to move back to SM from BH. And Google SM has been growing too.
The tech industry moves really fast: incompetent companies disappear overnight but new companies appear.
I think prices are getting lower, but not b/c of Yahoo. The writers' strike was actually a bigger deal than that.
Net absorption was negative in a number of submarkets, including Santa Monica (-160,500 SF), where Yahoo returned “must-take” space that they never occupied in the Yahoo Center to Equity Office.
Very interesting - thanks!
"Yahoo is declining in SM, but MySpace is growing like crazy and probably going to move back to SM from BH"
Yeah but MySpace is starting to lose its luster, with Facebook now being where the growth is and dozens of competitors springing up to splinter that segment. Thank god for that, all these venture capitalists and overnight paper millionaires are the ones bidding the prices up to such ridiculous heights. To the layoffs and recession that are coming, I say, bring it on!
Off topic -
I BELIEVE a vacant piece fo bare land just hit the market 1140 san vicente
a quarter acre flat lot i think
on very busy san vicente
i think it is a lot based on the picture
http://www.realtor.com/search/listingdetail.aspx?zp=90402&typ=1&sid=2770c1b578534834b50a41ddfbcce762&pg=2&lid=1095132773&lsn=12&srcnt=37#Detail
want to take bets on what this quarter acre of land sells for
You guys are way off. Symantec also use to be Colorado center and actually had far more employees than Yahoo. Symantec moved out for Culver City in October 07. Most people at Yahoo and Symantec didn't make any where near enough to even consider owning a house or condo in Santa Monica. A small layoff at Yahoo isn't going to make one bit of difference to the housing market in Santa Monica
I have to reluctantly agree
if you look at who is moving in to the flatlands of 90402 (or is it walk streets or is it sidewalk streets - can someone tell me the correct term)
it is overwhelmingly people that own their own business or cashed out of their own business - whether it is a successful chain of stores, or group of restaurants, or set of medical practices, or service business, it is business owners and former business owners
i just don't see many "employees" of big companies be they internet or not
when people sell their businesses, they still get the benefit of 15% capital gains tax, leaving plenty of ready cash to buy houses
I really don't know the vibe of the 90402 canyon area - someone told me that the canyon is filled with a lot more entertainers and entertainment industry executives - a totally different crew than the flats - can someone educate me by helping me understand what the community is like in the canyon vs in the flats and what the real name of the flats is
Most people at Yahoo and Symantec didn't make any where near enough to even consider owning a house or condo in Santa Monica.
An argument for maintaining Santa Monica's high prices has been new upscale jobs here since the 1990 bubble. Loss of those jobs is one rebuttal. Your argument above is another, that those jobs don't matter anyway.
It seems we have some 90402 decoupling theorists on this board!
Look, i personally feel certain that all of santa monica except 90402 will be down 40%
i don't want to argue with anyone - i think the prices outside 90402 are sure to go down
i am 80% sure the ones in 90402 will also be down 40% but some of the bull arguments resonate.
that is why i want to explore who it is that is moving to the 90402 right now - if you look at people that have moved in to 90402 canyon in past six months, who are they
if you look at the people that have moved in to the non canyone who are they
i want to point out that there was a very very nice guy , a persian self made businessman, that just plunked down $5 million for his dream home south of montana (thank you sm distress) i am not saying this is the start of a trend, but i am saying - is he representative of the people who are moving to 90402 now ?
Just because one businessman spends $5 mil on a palace doesn't mean that there are enough of them to absorb all the houses hitting the market in 90402
I heard from a friend on 29th that a property featured on this blog in 90405 area, 2343 29th St., 4/4.5, $1,895K, 8/2/07 (red. 5%), sold. Can anyone verify the selling price and other relevant details?
http://www.forbes.com/realestate/2008/01/31/housing-pricey-suburbs-forbeslife-cx_mw_0131realestate.html
http://www.forbes.com/2008/01/31/housing-pricey-suburbs-forbeslife-cx_mw_0131realestate_slide_2.html?thisSpeed=30000
This forbes piece is great
Part of the Los Angeles metro area, Santa Monica has a wide range of housing stock. Ritzy beachfront condos and houses go to the Hollywood set, and inland rental units host much of the city's population, as 70% of residents rent, according to the Census Bureau. The result? It is impossible for someone at the median income level of $61,423 to purchase average-priced property in Santa Monica.
I agree a million percent - SM prices will fall dramatically in almost all neighborhoods
But what about 90402 - who is moving in to 90402 today
Dow down over 300 points on the day. No one on the westside worries about their portfolios though, so this shouldn't affect anyone here.
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