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Weekly Market Report - May 27, 2021


Companies Ponder Speeding Up Plans to Bring Workers Back to Offices

Rich Lesser, the chief executive officer of Boston Consulting Group, gathered with his executives Friday in the wake of the CDC’s new guidance that says vaccinated Americans no longer need to wear masks and observe social distancing in most instances. At issue is whether the relaxed rules change how quickly BCG and other companies should bring workers back into skyscrapers from Manhattan to San Francisco. “It was a surprising decision,” Mr. Lesser said of the new federal guidelines. He said BCG executives would be holding more meetings to think through the company’s plans on Sunday and Monday. In New York, the day after the CDC announced its new guidance, real-estate attorney Jeffrey Schwartz and his partners met for an outdoor lunch at a restaurant a short walk from their Madison Avenue offices. One or two partners at Schwartz Sladkus Reich Greenberg Atlas LLP said they wanted to let people walk around the office without masks immediately, but most said they weren’t ready.


A Bill Is Coming Due for Greener Offices

Cutting carbon emissions is about reducing energy leakage from buildings as much as photogenic new technologies like wind turbines and electric cars. Property owners are understandably nervous about who foots the bill. The U.S., the European Union and the U.K. all have plans to at least halve their carbon output by the end of the decade. Property, which generates nearly 40% of global emissions, will face stricter regulation. Although commercial real estate is less of a problem than residential, it will likely be targeted earlier as its ownership is less fragmented and less politically sensitive. For developers, that points to higher construction costs. A net-zero office is up to 17% more expensive to construct, according to the U.K.’s Green Building Council. A green building is cheaper to run, but for now, most of the benefits go to the tenant. The evidence that property owners can charge higher rents in exchange for lower utility bills is mixed.


If You Thought Working from Home Was Messy, Here Comes Hybrid Work

It took months for bosses and employees to adjust to working remotely in the pandemic. The next era of work might be even more messy. Companies are laying down new rules and setting expectations for hybrid work as some workers come back in and others remain out of office. At JPMorgan Chase, employees on some teams can schedule work-from-home days, but not on Mondays or Fridays. At Inc. offices that have reopened, Thursdays are proving to be the most popular in-office day, creating high demand for meeting rooms and collaboration spaces, and prompting the company to rethink its office design. Executives at PricewaterhouseCoopers LLP have voiced worries that workers who stay remote could wind up as second-class corporate citizens, falling behind in promotions and pay, so the company plans to track rates of advancement for office-based and remote staff in an effort to make sure nobody lags behind.


New York City Schools Will Be Fully In-Person in Fall, No Remote Learning

New York City public schools won’t offer remote learning this fall, requiring students to return to classrooms in September, Mayor Bill de Blasio said Monday. Getting students and teachers back in the classrooms would be a major milestone in education as well as in reopening the city as it lifts a big barrier to people returning to the workplace. About 582,000 students, or 61%, are still taking remote instruction at home, according to the latest estimates from the city’s Department of Education, and thousands of other students left the district entirely, causing a 4% drop in enrollment. Mr. de Blasio said the DOE will invite parents to visit schools starting in June and through the whole summer, to show them what the agency has done to keep students safe and get them reacclimated

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