Real estate Antifragility

A trading company had been occupying the three lowest floors of a private building block in our neighbourhood for as long as we have been living there, that is more than 10 years.  Recently we were surprised that the trading company had moved out. It turned out that the owner of the building, Mr. L, one of the wealthiest man in the world, had decided to turn the space into a hotel, apparently in view of the increased and increasing number of tourists from Mainland China. 

The residents in the neighbourhood were opposed, fearing the increased traffic - both human and vehicular, trash, waste water, etc.  The owning company commissioned an environmental impact study which claimed that the environmental impact would be minimal. That was surprising.  A hotel with hundreds of guests making minimal impact on the environment?  It turned out that the study studied the impact of the supposed less than 20 staff members employed by the hotel, but not the hundreds of guests who sleep and eat at the hotel. That’s disingenuous to the extreme. Further, the supposedly independent company that did the study was partly owned by the tycoon.  That sounds dishonest.  So the tycoon makes the money while his neighbours pay the price of the degeneration of the environment.  Mr. L, of course, does not live in the neighbourhood.  So what does he care?

It also reminded me of something that I read in Nassim Nicholas Taleb’s book “Antifragile” and elsewhere.  He wrote “The worst problem of modernity lies in the malignant transfer of fragility and antifragility from one party to the other, with one getting the benefits, the other one (unwittingly) getting the harm.”  In the case, the tycoon and his company get the benefit while the neighbours get the harm.  It is not exactly “unwittingly”, but the end result is the same.  It is actually worst, because it is imposed blatantly.  

Do some people feel no shame?  Money at all costs? Evidently not.  How do such people sleep? Taleb actually talk about that as well.  But I will leave that for another post.