— पांच हजार पांच सौ पांच —
For once I have only a brief update for you! It's just as well, I have a bunch of work to get done today.
But first! I was cleaning out my inbox at work yesterday, and came across Kate in Marketing's weekly email, from October 27, digesting "News of Note." Somehow I totally missed the first article listed at the top of the email, in the
Seattle Times:
PCC and its workers still paying for pandemic and years of ambitious expansion.
That article was posted on October 26, just Thursday last week! I usually clock articles like this but, until yesterday, I had totally spaced this one. And it came out just one solid week before
the news that we're going to shut down the terminally unprofitable Downtown store at Rainier Square Tower at the end of January.
That article from a week ago provides a lot of context, though, including a kind of shocking amount about the perceived wastefulness of our "posh" Central Office location. To wit:
And many union members are still unhappy with PCC’s decision, nearly a decade ago, to move its headquarters from the University District to upscale offices on Elliott Avenue, with more than three times the space and views of Elliott Bay.
UFCW members say both those moves point to a broader problem: The 70-year-old co-op tried to copy corporate rivals with an aggressive growth strategy that has proven incredibly costly.
And:
Of special concern, union officials say, are occupancy costs, which include leases and store-opening expenses. Since 2018, which is the first year PCC breaks out occupancy costs in its public data, those costs have grown about twice as fast as labor costs. The downtown headquarters alone reportedly cost more than $700,000 a year, according to data from CompStak, a commercial real estate data platform. (PCC declined to comment on the lease figure.)
John Marshall, a financial analyst with UFCW 3000, has calculated that the increase in occupancy costs alone “represents about 70% of their entire deterioration in profitability” in 2022.
I have to admit, reading that "more than $700,00 a year" figure, in spite of having no context for it and no idea what to compare it to, was the first thing ever to make me reconsider my attachment to this office—which I still deeply love, fron the location to the views to the interior space itself. But roughly three quarters of a million dollars a year? Holy shit. I was genuinely shocked by that.
Mind you, union member complaints also point to our CEO salary, which I am really not on board with having any problems with. If we want a quality person occupying the position, we have to offer a competetive wage—is it excessive? Absolutely. Is it an unfortunate reality of retaining effective leadership? Also absolutely. The suggestion quoted in the article, by a named store employee, that we cut the CEO salary to
a fifth of what he makes now is utterly preposterous. We might as well be saying that we should have a CEO who is just a volunteer worker because "we're a co-op." Get real.
The CEO salary and the cost of office space, however, are completely different things. If things like location and views are adding premiums to our cost (and I don't know if they are, I am making assumptions), that has no bearing on us being able to do our jobs efficiently and effectively.
What I keep thinking about, though, is how Kate, our then-CEO, rationalized the choice of this office location back in 2016 by saying we got "a great deal" on our ten-year lease. So $700,000 rent
per year was a
great deal? Holy hell. You know what I am wondering now, with the wildly changing office real estate market, is whether what was a great deal in 2016 might be highway robbery in 2023. Maybe it isn't, I don't know. But I am stunned by that price tag. Although it's clearly unconfirmed, if it's, let's say, $725,000 a year, between 2016 and 2023 that's cost PCC $4.9 million. And in the meantime, PCC has made all these public statements about how we can't afford the mandated pandemic "hazard pay" for store employees. No wonder they resent co-op leadership.
Another relevant reminder: leadership today is entirely different from when it was in, say, 2015. A lot was said at the Town Hall meeting yesterday about how no one wants to "pass judgment" on predecessors, but it's clearly difficult not to. They made decisions based on predictions that turned out to be wildly wrong. No one could have seen a pandemic coming, of course, but we're still dealing with contractual obligations that would likely be sources of frustration regardless.
I do feel compelled to say that our CEO in 2015, while I never had any personal anomosity toward her, was widely polarizing, and many people were unhappy with decisions even then. Even before the pandemic, I have long felt the aggressive store number expansion in these past several years was not the best idea, but I have been assured that decision can't be laid at the feet of the CEO, and that it had been actually mandated by the Board at the time. Now, we have two store staff people on the Board, which never happened before their tenures. I actually feel pretty good about the leadership we have now, and have a fair understanding of how a lot of what's happening now is in reaction and adjustment to decisions of predecessors.
As for the office space, the truth is, the ship has absolutely sailed when it comes to people regularly working from home, which has resulted in even more wasteful spending than it probably appears: as I write this, I sit at a desk in a section of the office with 24 desks, between two different dividing structures of conference rooms and phone rooms. Only one of those rooms has a meeting going on right now, and I am literally the only person sitting in any of these 24 desks. Full disclosure, someone sitting at one of the other 23 desks actually is in the office today and is sitting in the meeting happening on the other side of my desk right now, but still: that's 2 people working in-office today, leaving 22 desks empty. All day. And that's just this section, which crosses three departments. Not a single person in Finance is working in the office today. This is pretty much par for the course on Mondays and Fridays.
My point is, we're sitting on a ton of unused space in here anymore. My only truly strong feeling about a new office location would be that, as one of the few people who actually works in the office every day, I still get my own dedicated desk space. Honestly, after seeing that dollar figure about the cost, for the first time ever I am actually moving toward advocating for a move myself. Seriously I can hardly get over it.
EDIT: This afternoon I found
this 2017 Puget Sound Business Journal article about the office move—which the article calls Interbay but we are technically right in the northwesternmost corner of Belltown, but whatever. It was, after some online digging, the one article I could find that indicated the square footage of our office space: 26,000.
Let's lean on the conservative estimate of $700,00 in annual rent. That breaks down to about $27 per square foot. And, guess what? According to
this breakdown of asking rents in office vacancy rates around the city, hat is very near the
lowest end of the spectrum. Only First Hill has cheaper asking rents, and what we're paying is fully $10
less per square foot than the 2022 asking rate in Belltown. Maybe we actually are getting a deal?
This begs the question: even if we find an office space that's half or two thirds the size, if the price per square foot isn't anywhere near as low, would we even be saving any money? Granted, the expectation was always that the price would go up at the end of our lease anyway, so there's also that.
— पांच हजार पांच सौ पांच —
— पांच हजार पांच सौ पांच —
Hey wait a minute, didn't I say today's update was going to be brief? I need to stop saying that! It's almost never actually true.
I genuinely don't have a whole lot to share about last night, though. I took myself to see
What Happens Later, which I figured I would like okay, and then it exceeded my expectations: I really enjoyed it.
I did have a bit of a snafu in getting to the theater, however. I had a seat booked for a 6:15 showing, which I went to after taking the bus first to Virginia Mason to get the blood work after the order has finally been put in by my doctor; walking home and eating a quick dinner of leftovers Shobhit had ready to eat (which was great); then busing back downtown again. There's a guy who is a wheelchair user, and kind of has upper body mobility issues as well, who scans in QR codes for mobile tickets. I figure they employ him at times when the theater is less busy, which means I see him a lot. He said hi to me, and "Haven't seen you in a while"—I probably last saw him, I don't know, three weeks ago.
But when he scanned my code, he goes, "It says no ticket found." I was very confused. I clearly booked it. He looked at his scanner and said, "You booked for Seattle 10." Shit! I was supposed to go to the U District!
He asked if I'd like him to see if it was playing there, and I said no, I was pretty sure it wasn't. I looked later and saw that, actually, it was: just another hour later. I had gotten there at about 6:05 for a 6:15 showing, though, and I realized: Light Rail to the rescue! I could go the couple of blocks over, down to the Westlake Light Rail station, and get to the U District station in a matter of minutes. I would almost certainly still get there before the trailers were even done playing.
I am so, so grateful for the existence of Light Rail—especially since the Northgate Link extension two years ago, which added the U District stop, four blocks from the AMC 10. How late I was depended only on how long I'd have to wait for a train, and one pulled up at Westlake Station in maybe three minutes.
I didn't miss any of the movie. In fact, when I got there, the trailers were still playing—with audio only. The screen was blank. As the only person who apparently bought a ticket for this showtime, I went out to tell someone, and they clearly had a bit of a challenge getting it to work correctly. The published showtime was 6:15, and at 6:35 they were still working on it. They got the screen to come on in the middle of the Nicole Kidman AMC commercial, which they then skipped to the end and the actual movie finally started, with picture! And then the movie itself was really fun.
I took the train back to Capitol Hill Station, walked home, wrote the review. Sat with Shobhit to pet Shanti on the couch for a minute as his request. Then I went to bed.
— पांच हजार पांच सौ पांच —
[posted 12:32 pm]
