Value of one of S.F.'s biggest buildings plunges by 80% after Uber, Block leave

Uber’s Business Model and Profitability

• Debate over how Uber can justify years of massive losses; one commenter misread its first annual profit as $1.83M rather than ~$1.9B, corrected via SEC filing.
• Some argue recovery of past losses isn’t required since equity, not debt, funded growth.
• Others see a “techno‑feudal” pattern: subsidize rides, kill competition, then raise prices.
• Defenders stress city‑by‑city economics: mature markets may be profitable while new markets burn cash.
• Network effects and two‑sided marketplace dynamics (drivers vs riders) cited as capital‑intensive via marketing and local operations.
• Barriers to entry seen not in the app itself, but in data, logistics, and density of drivers; skeptics counter FSD could undermine Uber’s future.

Commercial Real Estate Valuation Dynamics

• Office buildings are valued as a function of rent and income; lower rents or vacancies can trigger lender demands or violate debt coverage ratios.
• Landlords often hold asking rents high and instead offer free months, build‑outs, and “tenant improvement allowances” to preserve official rent levels.
• Some argue this is irrational and propose valuation formulas that decay with vacancy duration to push rents down faster and reduce emptiness.
• Others respond that real value is what buyers will pay, and lenders routinely “extend and pretend,” avoiding write‑downs.

San Francisco Office Market and Urban Conditions

• Many note widespread Bay Area retail closures; fewer office workers reduce demand for nearby shops.
• SF’s appeal as a tech hub is questioned: costs, competition for talent, and deteriorating street conditions (including drugs and safety) are deterrents.
• Counterpoint: dense expert networks, especially in tech and finance, still provide hiring and innovation advantages versus smaller or cheaper metros.

Specific Building and Location

• The featured building originated as a 1970s IT/data‑center “bunker”: large windowless floors, poor natural light, but unusually strong seismic safety.
• Interior office build‑outs (e.g., WeWork, Uber, Block) are praised, but the surrounding area is described as unpleasant and unsafe, depressing demand.

Mixed Use, Housing, and Vacant Space

• Commenters see single‑use commercial zoning as fading; mixed‑use (office + residential) viewed as the future.
• Some note widespread vacant commercial property and even “ghost” residential units held by investors or foreign capital.
• Disagreement on who benefits most from new high‑end development: some say only the rich, others argue any added supply indirectly helps everyone.

Pension Fund and Ownership Outcome

• A Canadian pension fund bought a 45% stake at a high valuation and later sold back at a steep loss.
• Discussion frames this as the operating partner effectively extracting gains on the way up and reacquiring the asset cheaply on the way down.