Bloomberg Businessweek Weekend - September 12th, 2020

excited to get into that. That is the story of the fall back to the office, back to school so certainly pervades almost every conversation we had this week. We're also going to bring you another edition of Business Week Talks your conversation with Brian Nicol, the CEO of Chipotle Mexican Girl. I'm gonna say I'm a fan. I've eaten such Chipotle over this pandemic. I have ordered our family definitely has ordered uh during our time at home, no

doubt about it. And this is a company that understands crises. So we'll see what he has to say about kind of where we are in the pandemic, what the out look is for this company, and this is one that's been pivoting big time towards digital, so we'll dig deeper into that. We begin this hour though, with news also this week about Astra Zeneca. They were pausing tests of the company's experimental shot after a patient became ill. Now keep in mind, Jason, and this is something we tried

to dig into with our conversations. This is delays which are often a routine event for the pharmaceutical industry. And it's a reminder though that developing a safe and successful vaccine it's gonna take some time. And yet we know that every tick and talk towards the vaccine, regardless of who's involved, it immediately becomes one of the most read

stories when it crosses the Bloomberg No exception. Here we caught up with one of our in house go to voices on COVID nineteen Bloomberg News Health reporter Michelle Cortess. It's kind of astonishing how quickly and smoothly everything has gotten to this point. We have more than two dozen vaccines in clinical trials for a virus that we didn't even know existed, that probably didn't even exist a year ago. So that is astonishing, and as you point out, there

are normally hurdles and problems that come up. The way this one has been coming out is a little bit um unsettling, to say the least. So we heard that after Zeneca had paused its trial. They're saying that it's a very normal thing that it happens when there's an

unexplained illness. The condition that we're actually looking at, it's a spinal cord condition called transverse my lightest causes inflammation in the spinal cord can lead to paralysis, and it is something that's worrisome, and I guess it's also a reminder, Michelle, at just how heightened all of this is and how heightened all of us are. We are. We're both hopeful, but I dare say feeling almost a little bit desperate because our very way of life has has been changed.

We've seen tens and tens and tens of thousands of people died just in the United States, and there's a sense of urgency that I don't know we've ever collectively felt. Certainly in my lifetime, I would agree with that. But also there is a concern here, of course, that that there's beliefs that a vaccine is going to bring us back to normal, that we do have an issue with

um with vaccine hesitancy and skepticism in the US. So the idea that that some of this information is coming out not so smoothly it a little bit is a little bit concerning. Also, we did learn that there had been an earlier incident as well where they temporarily paused

the trial. It didn't disclose that where they had similar symptoms of of you know, paralysis type issues, and it turned out that the patient had multiple sclerosis and they determined that it wasn't related to the vaccination although the person had gotten the vaccination. We're not exactly sure why

MS develops. So with two with two potential ties to a neurological condition, you know, at some point people are going to be making a decision whether they're going to participate in a clinical trial, which clinical trial, and then when we get done, hopefully we'll have more than one option. Which one are you going to pick? Yeah, exactly, Well, there are different types of vaccines and I've been trying to kind of brush up on it. I'm not an expert,

but in terms of the creation of vaccines. Right, there's different ways of doing it, and I do wonder are certain vaccines potentially going to be safer than others. There are different ways to go about doing this, and it's really again astonishing the breath of approaches that we have

already that have emerged. When it comes to coronavirus. There is some companies, there are some companies who are building off standard models that we already have, like seasonal influenza, and they're just using a different ingredient basically in their vaccine. So they're hoping to provoke an immune system response to coronavirus instead of influenza. Does that make it safer Michelle or not necessarily? Well, I think that there's two ways to think about it. You have the platform, the way

that you're going about doing it. And so for influenza, it's been given to you know, hundreds of millions, maybe billions of people over over decades and decades, right, so the platform is a known platform. Then you're putting in a different portion of the virus, you know, maybe the spike protein or something else, and so it's possible that the body would respond adversely to what you're putting into it.

But the platform itself should be safe. Whether or not it's going to be effective is unknown, But then they're completely novel ways like what astra Zeneca is doing. It's it's not currently used in any approved vaccine, same as Maderna. They their approach is totally novel and different from astro Zenicas. J and J is working on a similar thing, but also some more conventional approaches. So there is a wide variety. There is a wide variety. So you are Google on

the virus. We could go to Google and you know, look for things, or we could just bring you in, which, yeah, exactly, which is much I feel like, much more helpful and much more enjoyable for us, to be honest, lead the googling to the chart of the day. Alright, Michelle Cortez, thank you so much, Health Science, Medical Technology reporter for Bloomberg. So great to catch up with her and Jason. No data at it one of our go to voices when

it comes to the virus. Really understanding, as you say, the tick and talk of the headlines that come across. And what I love about her is, you know, she said to us, it's kind of been a surprise at how quickly and smoothly everything has gone, and we need to keep that in perspective, especially as we rush to get a vaccine, and that there will be some delays, and they're going to have to be some delays to make sure that it's a really safe vaccine and effective vaccine.

That's right. We're settling into a long haul of sorts with all of this. There has been this rush, but it's not a magic bullet, and it's not a panacea by any stretch of the imagination. It is part of the jigsaw puzzle that we're all putting together in real time, a three D puzzle in many ways. You're listening to Bloomberg Business Week coming up. Another edition of Business Week talks the conversation you had with the CEO of Chipotle. Yes, indeed,

we're talking about Brian Nichol. This is Bloomberg. This is Blue Verb Business Week with Carol Masser and Jason Kelly from Bloomberg Radio. Jason, it's a company synonymous with the fast casual space. It's in fact credited for creating it to Potle Mexican grill. It's a company that took off like a rocket. It's stumbled for a couple of years as it dealt with its own crisis and e coal like crisis that was back in It led to a series of C suite exits, attention from activist investors, and

a new CEO two and a half years ago. So I caught up with the CEO to Potles, Brian Nicol. He is going to be featured in upcoming Business Week talks, and in this segment of our in depth interview, we talked about the impact of the pandemic. I think where we are right now is in a state where I think everybody understands what they need to be doing. Uh, and so as a result, I think people are starting, you know, to demonstrate good behavior so that we all

contributing really containing the pandemic. We've been very fortunate in our restaurants where our employees, I think we're doing a lot of the right things. We've put a lot the right food safety practices and wellness practices in place, So that's giving people confidence to you know, basically used to pole as a meal solution. And then obviously our digital business is giving people access for that off premise occasion

that is becoming really critical. Yeah, and I want to talk about that because I feel like you are very precient in terms of the investments you made and when you came in about two and a half years ago. Focusing on that. Before we get to that, though, I do want to ask you, are you preparing your company your staff for a second round with the virus come the fall and winter months, And I do wonder if you're kind of taking precautions, are setting up, um, you know,

just in case. Yeah. Look, I think we definitely have uncertainty in front of us, UM, and so really the approach we're taking is we're following the recommendations of the CDC and a lot of the local health departments around making sure our employees are wearing masks, we're practicing the social distancing. Uh. You know, no one works if they're

not feeling healthy. UM. And you know, obviously we continue to be in a working remote environment, so we want to take all the precautions we can to hopefully contain the pandemic and get to the other side of this. UM. You know, it would be a real disappointment if we have a setback, and I'm really hopeful that if we do all the right things as a company, as a community, we can avoid that setback. Do you think we'll get one?

You know, you know, honestly, I I really hope people do the right things going forward so that we don't you know, uh, I think the big recommendations out there, you go get flu shots where your masks, practice social distance, avoid big crowds, and that's our best bed to avoid a real you know, major flare up. But you know, cold and flu season, more people are probably not gonna

feel great, and it's important people get tested. They understand whether they have COVID or just a common cold or flu, and then they need to do the right things to protect themselves, their family, their friends, and their communities. And I think if people just take that simple approach, um, I think, you know, we'll get past this a lot faster than uh not taking those safe safety precautions. So how do you keep you know, your employees safe motivated

during these trying times? And we talk about you know, corporate culture. When you've got people at home and people all over the place, how do you keep though your workers who have to be at work in order to get the job done. How do you keep a motivated during these trying times? And I'm curious if you've made any employee policy changes during the pandemic. Yeah. Look, Carol, I think it's fortunately for us. We we've always been focused on our purpose, which is around this idea of

cultivating a better world through food with integrity. And we've got some clear cultural values, um, you know around basically authenticity lives here, the movement is real um, you know, teach and taste Chipotle, and then the line is moment of truth. And the reason why these values are really important is we've used them to guide a lot of our decisions. We believe our per this and our values drive our culture. It's why people love to work at Chipotle.

And we've been consistent, I think in all our decision making against our purpose and our values, and I think it's given a lot of our employees a sense of pride um. They love the fact that, you know, regardless of how hard um the decision is, we want to do the right thing for our communities, moving our purpose board and obviously our employees. So you know, we were fortunate we already had a lot of things in practice from a wellness standpoint, and you know, paid sick leave

and uh, a lot of employee programs around healthcare, mental wellness. Um, you know, I'm sorry mental health benefits that were available for not just the employee but their families. So we're trying to surround people with all the right things and those have been even more important in these challenging times. And you know, we've dialed up our communication. I'll tell you the other thing that has really been powerful is, UM, we have really worked our to communicate with every single

employee at Chipotle, all ninety plus thousand of them. UM. You know, we're doing zooms and web calls and telephone calls. I just want to keep them up to date with the most um, you know, up to date information. And the more they know, the more they can feel confident that we're making the right decisions and they're working in

a safe environment. UM. I've had the pleasure of making some day trips visiting restaurants, and I can tell you it really gets you pumped up because our employees are so grateful, UM, to be working and to be a part of Chipotle and making a difference in their communities and moving our company and culture forward. Well, and I'm guessing you're visiting a lot more workers because you guys have been on a significant hiring push back into Loe.

You talked about hiring about ten thousand workers, So how has that push gone so far? Where are you in that process? Yeah, it's been you know, we're very fortunate. People have been really excited to uh join Chipotle, and the applications have been, uh, you know, frankly, really exciting to see did you get something like seven hundred? Didn't you get something like seven hundred applications or something? It was crazy. You know, I don't remember what the numbers,

but I wouldn't be surprised if that's close to right. Um, you know, because we have had you know, I saw we just had a job for one of our digital opportunities open up, and for just this one position, we had well over you know, I think three or four hundred applications, which is really amazing. Um. And you know, now you've times that out across ten thousand opportunities, from you know, crew members all the way up to jobs

that are support centers. And we've been very fortunate to attract really great people and we've been able to retain really great people. So we're we're feeling really fortunate with where we are, with the people we have and the people that are drawn to to work at Chipotle and apply and want to be a part of what we're doing.

That's Brian Nichol, the c of Chipotle Mexican Grill. And catch more of that Business Week Talks interview next week in the magazine on the Bloomberg online at Bloomberg dot com. I mean, Jason, this is a company. They really have just kind of changed how we eat out in a casual way, and yet they understand crises like no other. They absolutely do. And so the playbook, while it's different for every crisis, that sort of attitude, that posture, it

certainly has to prepare you for the unexpected. Great great interview more to come on that one. You're listening to Bloomberg bu Week. Coming up, we hear from the intermitting of the Robert H. Smith School of Business at the University of Maryland talking about the dual pandemics right, the health crisis as well as the problem with inequalities. This is Bloomberg. You're listening to Bloomberg Business Week with Carol Masser and Jason Kelly from Bloomberg Radio. Carol, clearly we

live in a world of dueling crises. Who've got at least two going on right now, and we never know what's around the corner, and that is making it all the more demanding for young business leaders and for those who trained them. One of the folks tackling this is Rito Agarwall. She is the interim Dean of the Robert H. Smith School of Business at the University of Maryland. She also understands that business school students they need to be around each other, and that came through loud and clear.

Check out our conversation. This has been such a wild ride for the past six months, and there are so many different things that I can talk about, but I do want to sort of take you through the ACAPA experience. Let me start by what's it like inside the business school today? Density is slow, but students are masked and they have big smiles on their faces. From what I can tell from behind their market they are just so

glad to be back. We'll talk to us a little bit, to dnagar Wall about the adjustments that you guys have had to make in order to you get students back on campus. So let me just talk about, you know, sort of two pandemics that we've dealt with in the last six months. Right the first one is of course the public health crisis that is front and center and

everybody's mind. But there's also a second, more subtle one that reveals itself at the end of May, and that's you know, the national spotlight on the racial injustice and systemic bias. So we've had to make adjustments to address both of these pandemics. So I'll start by focusing on the first, which has you know, of course, captured everybody's attention, time and energy for six months. Now. Um, I want your listeners to remember two words, unprecedented and pivot, because

that has really described our experience so far. So on March eleven, you know, we all received an email and a text on our cell phones telling us to go home because the governor had just imposed the stay at home model, and literally overnight, the campus emptied out. Both campus and the city of College Park became ghost towns. And luckily we were scheduled to go on screen break the following week, and we delayed the started classes by another week, and that allowed us to make the first

crucial pivot, you know, on a dime. We took five courses and we moved them all to online delivery and let me just say, Carol, anybody who thought can appreciate the complexity of taking what was design is a face to face course and moving it online in a matter of a couple of weeks. You know, it's not just simply getting onto a Zoom meeting and giving a lecture. There are so many nuances related to teaching. There are so many different adjustments in pivots you have to make.

So we did that. That was fall, and then the entire summer was spent in I want to say, hundreds, if not thousands of hours of meetings trying to figure out what should be our strategy in the face of a pandemic that nobody can predict, in the face of a virus that's totally unpredictable, that's moving in whatever direction it wants to, in the face of shifting public health guidance on how institutions should be moving. So that's what

our summer look like. And when you think about Dnagar Wall, the students, the interaction among students, the whole notion of a business education is an extremely collaborative one. And granted, we're all adjusting to that, and we all are adjusting to to working on Zoom and Carol and I only see each other over video conference at this point. Literally, UM, but what's missing and how do you make up for it? Uh?

If some, if even some of that interaction has to be virtual, that's a great question, Jason, and one that we've grappled with. UM. We have an Office of to Informational Learning that has penagogical experts who can allow us to recreate a few will not a hundred percent, but pretty close to that off that rich face to face interaction that you might have in an online setting. So we've tried to do that in as many of our classes as possible. But I don't want to make one

more point. One of the controversial decisions we made over the summer, and for exactly the reasons that you outcline, Jason, is we decided we're going to come back and fall and have a hybrid quasi in person quasi online experience. And that's three to Aggrawall. She's the interim Dean of the Robbert Ahm School of Business at the University of Maryland. Interesting to talk with her. I have to say, Carol, you know the nuts and bolts of getting back to business,

in this case business school. It is not easy. No it's not easy, and especially as she talks about these two pandemics that are facing our world right now, talking about of course the virus, and then also talk about diversity and inclusion. It's something the school has been focusing on a lot. She says, they put a lot of initiatives in place, but she said, we can kind of do better, especially when it comes to attracting a more diverse group of faculty, and so there are things that

can be you know, definitely improved upon. And I think that point about the faculty is a really important one that maybe we're not focusing as much on. And I also was intrigued by what she said about the case studies, what they are actually studying, the examples that they're using to learn about business. You need to think about diversity, inclusion and a wider swath when it comes to that. That really stuck with me. Coming up, Jason, we've got

one of those potential case studies. We're talking about Don Peebles. He's the founder, chairman, and CEO of the Peoples Corporation. He has been practicing diversity and inclusion at his own firm for years and also helping others to do exactly the same. Yeah, it's a smart conversation. I took a lot away from this one as well. That's coming up. This is Bloomberg. You're listening to Bloomberg Business Week with

Carol Masser and Jason Kelly from Bloomberg Radio. So, Carol, diversity and inclusion in action in the real estate world. What does it look like when you actually do this day to day? That's the question we pose to Don Peoples. He's the founder, chairman, and CEO of the People's Corporation. That's right, Jason. It's a privately held national real estate investment and development company. It's got a multibillion dollar portfolio projects New York, Boston, Philly, Washington, d C, Miami, and

out on the West coast as well. He also served on the National Finance Committee of President Barack Obama. He's on the board of the Greater Miami Convention and Visitors Bureau. He's also the former chairman of the Congressional Black Caucus Foundation. So he has seen the world from so many different perspectives. Initially, though we talked about the short term impact from the pandemic. Well, short short term impact, I think we're seeing it now. There's been a more of an exodus out of the

cities UM and more so into the suburban markets. And then UM more people are relocating to UH places like Florida for example, UH in preparation for the winner. But I think that you'll see UM and a greater UM you know, stabilization as we get through this winter. I mean, the cities are not dead New York City, while you know it's it's limited occupancy right now in terms of office space, UM. Most restaurants are closed and other businesses

are closed. UM. So there is a a short term decline because tenants aren't able to pay their rent and the office tenants who generate a lot of activity in the marketplace, the office workers are not there either. But I think that short term UM, I do think that the UM pandemic has structurally changed how we will consume

office space as we go forward. I think that companies around the country and around the globe, especially here in the US, are reevaluating how they deal with placing their employees, how much they're going to rely upon remote working, which has proven for the typical office workers to be much more effective than UM most companies thought. And so I think that that will be a structural shift in UM the officias long term. I think that UM most retail

UM has changed forever. But that was a pre pandemic technology. It had disrupted retail considerably. And so when you think about sort of the reorganization, the rethinking of offices done, you know what does that mean? Does does the pricing change? Does the relationship between the owner and the tenant change? Does what gets developed changed? I just wonder sort of thinking through the mechanics and and sort of playing that out what it looks like. Well, I think that first

of all, I think that's the easy one. Is what gets developed definitely changes. It will what gets developed going forward will change in terms of how the office space will be configured going forward, and how protocols will be put in place, UH, in terms of how people enter buildings, how we met people entering the building, in terms of health and UH. And even once this pandemic is behind us, UH, the new buildings will be better designed and better built

to address a future potential pandemic as well. I think also the close proximity of coworking and how most companies were shifting towards open floor plants. I think that changes isn't that kind of sorry to interrupt you, but isn't that kind of amazing? Because that really felt like something And listen, you know us, I mean, you know, Bloomberg, like we were all about the open. We still large to a large extent because nobody's really here, but I mean that seemed like a trend that was just going

into the going into the future in many ways. Yeah, I mean Bloomberg were very innovative when you all built your your officers um um um and on the East Side and the old Alexander site. What happened there is you all created a almost to live and work environment to a degree because you've got the open cafeteria. Everything was open um even the waiting areas and so forth, where visitors were open, and your studios were pretty visible

and open as well. So I think that that configuration is going to change to some degree, especially um how how people work at their desk. And also I think gone is going to be the days, even with the law firms and the like, where each individual has their own office or their specific workspace. I think that that will change because you'll see a lot more remote working and also those who travel to other locations will not

need a fixed office. So I think the fixed office um UH or fifth six workspace has changed, will change. And I think also you'll see more collaborator spaces that have some form of social distancing potential and employ the immediate use. You'll see that in place now, I mean, but I mean you can really you can see that across the board. I happen to be, by the way,

I'm not implored. I happen to be in zach Harbor, but I'm in Manhattan last week, and and and and what you're seeing in in UM office spaces that are being utilized and very few people are there, and I think that's going to take a lot of time for people to come back, And and buildings are going to have to employers, they're gonna have to tell people by action UM that it's safe to come back. So done.

Let's talk about the wealth gap, because it has been a subject that we have I think taken much more seriously candidly over the past couple of months as we've really started to I hope, embrace this reckoning that we're seeing around racial inequality and being Bloomberg and Business Week, we follow the money, and the wealth gap is vast. I don't have to tell you what do we do about it? Well, I think we've got to widen the opportunity.

I think that there's no talent is discriminated, distributed indiscriminately, and uh, you know, opportunity is distributd on a discriminatory basis,

and I don't. I think that we've got to look at expanding access to capital, expanding opportunities in every industry across the board, and be mindful that we as business owners and entrepreneurs and CEO have to take affirmative steps and providing fair access to career and economic opportunities to minorities and women because both are severely underrepresented in every

industry of any consequence in this country. You know, Donna, you know, our team here at Bloomberg did a story about Silicon Black Silicon Valley entrepreneurs venture capitalists and how they had reached certainly success in their lives and you know, in terms of Silicon Valley, but they were even having trouble being able to support other minority owned businesses at their own firms. We're finding it difficult to get others to get on board with them. And so I wonder,

what's the trick here. How do we change this? Well, I think that we have to. I mean, my industry is one that I think it's has an easy remedy to it. It's um. You know, the real estate development business is a low barrier to entry industry. You can start off from any perspective UM as an entrepreneur and go into real estate development. Doesn't require any kind of license of specialized skill, requires some talent and access to capital.

And the capital that funds real estated mainly through private equity and private equity. Biggest investors are public employee pension systems, and so for example, there's about seventy trillion dollars in venture capital and private equity right now, and about one point three percent of that money is deployed to businesses

owned or run by minorities and women combined. And yet a significant portion of the contributors to the public pension systems, the workers who whose money is being investors are minorities and women. And so if we can have fair access to that capital, and those investors tell the allocators of capital that they want to see their capital deployed in a more diverse manner prudently by the way, but more diverse matter. Um, there is no shortage right now of

capital in the marketplace. There is a shortage of where to deploy the capital. That's why we're seeing this from the market react the way it is, UM, And so I think that other aspects it's important is people have to understand we're not we don't in order to bring equality. It's not about redistributing wealth, redistributing opportunities, just just expanding it and expanding opportunities to create wealth. And so don

how do those institutional investors. I agree with everything you're saying, and you're echoing something that John Rodgers said on this program about the institutional investors and especially the public pension funds, which candidly they've gotten religion about some other issues, you know, sometimes it's around gun control and other things where they've essentially said, look, I'm not going to invest in certain sectors or I'm not going to invest in certain managers

unless they meet these certain criteria. E. S. G has been an area, especially around the environment and climate, where they've done that. Why haven't they done this yet in your estimation? Well, I think that in part because they are missing misinterpreting their role in studuciaries. I think that the idea to pick the most qualified, the best, and

the least risk the firm that's been around longest. And so if you're going to have an aversion to first, second, third time funds, then it's going to be very difficult for you to create an environment where there will be more minority and women manage funds. So they've got to be willing to um make strategic prudent investments in utilizing

a different criteria. That's Don Peebles, founder, chairman and CEO of the Peoples Corporation, so much to say about kind of where we are in terms of the real estate world, where we are going. You know what really stuck with me, Jason was how he said he does think the pandemic has structurally changed how we use our office space in particular, and we'll see how much of that sticks. But man, he's got a front row seat to this. We're gonna

pull that through a little bit more Carroll. Next hour, when we hear from another legendary real estate investor talking about Tom Barrack of Colony Capital. He's going to talk to us about the future of cities and the suburbs. So that wraps up the first hour of the weekend

edition of Bloomberg bus This week from Bloomberg Radio. I'm Jason Kelly and I'm Carol mass There plenty coming up in our next hour, including a fascinating story is one of the most read on the Bloomberg when it hit the Bloomberg terminal was all about a letter to Wall Street workers about Hey, why don't you come back to work. Plus, we're going to hear from the president CEO of Mahindra

Automotive North America about what they're doing in Detroit. And we're gonna round out the show talking about your pet. It is a big business, right Scout. I love my dog. This is Bloomberg. You're listening to Bloomberg Business Week from Bloomberg Radio. Hello, I'm Carol Masser and I'm Jason Kelly. Welcome back to Bloomberg Business Week Week twenty six. So, Carol, if I've got my math right, that's half a year we've been working from home. Amazing, amazing. Yeah, I still

can't believe it. Uh, And listen, we're starting to see more people trying to get back to work, certainly more conversations about it, and that certainly is something we're gonna get into over the next sixty minutes. We're also going to hear from the president CEO of Mahindra North America. They understand the auto space. Um, so we got a really great view of what's going on in that world, but also how that company is helping its community around itself.

We're thinking so much more about our space where we live and where we work, and where we live at least increasingly we're living with pets, and we're going to talk about that with the CEO and founding partner of the Animal Policy Group. I heard your scouts ears perk up at this interview. She is a spoil a little pup first up. THO was something that caught her attention and really the attention of Bloomberg terminal users. Man, this

was the most read story on the Bloomberg terminal. And yeah, that's what's gonna happen when you see this headline, Dear Wall Street, your boss wants you to come back to the office. Yep, everyone was reading this sending it around asking what you thought. Bloomberg News financi reporter Michelle Davis, she had a busy week. She filled us in on

what's going on. This is really a story about a lot of the fear and tension and anxiety that's bubbling up on Wall Street right now, with you know, many folks considering whether they should return to the office after in some cases working from home for as long as

six months. And over the summer, a lot of the banks started opening their offices back up, but they weren't requiring anyone to return, and for the time being, it seems like they still aren't requiring people to come in um, but more and more people are are starting to wonder, if you know, as they're reading between the lines of memos from their bosses, they're trying to figure out, you know, is my boss saying, but we work better in person

because he wants me to go back. If I don't go back, is it going to jeopardize my boss or

my job? You know, there's a lot, a lot up in the air, a lot of uncertainty that's coming around with this, with the open endedness, and so what we're hearing is that as more and more workers start to go back over the next few weeks, be it because they want to get away from you know, annoying housemates, or they want to change the scenery, or they are harried that you know, bosses, their colleagues are going to

think that they're weak. Um. Wall Street is gonna be looking at this as kind of a testing period to to see if you know, social distancing can really be done in force from an office, and we've heard that at JP Morgan in particular, they executive they are going to be monitoring the situation to see that if as more people come in, you know, in the crowd, the

trains get more crowded. Um, if things go well and infections don't spike, they're considering becoming more forceful in their language and saying, you know, rather than framing this as an invitation to return, requiring more people to return, with the idea being that, you know, if this is going to be the new normal where there's not gonna be a vaccine, you know, probably not this years, then let's get to that sooner rather than later. Let's let's you know,

get more people back into the office. Because as well as things worked at home, like, it's still important from a culture and control standpoint, um, at least in banking for people to be you know, interfaced next to each other in person. Well, what's interesting and what I love about this story And if you haven't seen it, um,

I think I've put it out on Twitter. You guys should everybody should read it in its entirety because you get into the specifics, like JP Morgan, you say they've been reimbursing uber and taxi rides to the office for traders below the managing director level so they don't have to share public transfer transportation, investment banking. You said that the firm has asked that fifty of its dealmakers be

in the office on any given work day. So there's stuff we know going on, depending on maybe what your job is. What I think is interesting too though you talk about those that are eager to kind of get back to work and how that can create anxiety and others who aren't so eager to get back to work, and I think whether you have kids, how you get to work, Like, there's a lot of factors at play here, definitely, And I think what I have found most fascinating throughout

this is that you know they're still a virus. And two months ago a lot of these banks were saying like, no, we don't want anyone. They're still saying we don't want anyone to build pressure to comment to the office like you, what's comfortable for you, what's that's for you and your family members. The fact that conversations are even happening right now around you know, we might get to the point in a few weeks where we're going to force you

to come in like that. It just shows that we're entering a new phase where and that's what you guys are That's what you guys are hearing right from the folks and sources that you've talked to, that that's where it may be going. Yeah, it took it. It took

a hard turn. It feels like, Michelle, I have to be honest, and and really what fascinates me about it is this notion that it took a hard turn just as bigger and bigger question marks were raised around what I and I think others think is the biggest issue,

which is schools. I mean, if you have young kids, if you have school aged kids, especially elementary school aged kids, this is a very very difficult situation in terms of just the logistics of educating your kids and making a living absolutely, and and the public transportation, uh, you know, challenge is one that is getting back to normal in

New York, especially hard. I thought it was interesting. One of the people I spoke to, who we included an anecdote from the person on the story, was saying that she just thinks it's going to be inevitable that everyone's going to return to lockdown in just a few months.

So that's why she's the worker at working, and that's why she plans to kind of cycle in and out of the office right now, because she's like, it's probably the only opportunity I'll get to see coworkers because we all know how this story plays out, like the second you ease up on guidelines, infections are going to spike,

and when you go back to the beginning. And that's reporter Michelle Davis love talking to her because she's got so many great sources across Wall Street and people are starting to speak out about what they're hearing and what they're feeling. This is such a complicated time when it comes to how we're gonna work. Carol, Yeah, it's all

about comfort levels. But you know, there is pressure I think on companies because I think there's a fear of losing a little bit of your culture by not bringing workers together, or when it comes to Wall Street such a competitive space, they're worried about losing deals or trades, and so they kind of want to get their teams

back together. You're listening to Bloomberg Business Week. Coming up, We've got a conversation with the president CEO of Mahindra North America talking all about the city where they live. This is Bloomberg. You're listening to Bloomberg Business Week with Carol Masser and Jason Kelly from Bloomberg Radio. Well, Carol, Mahindra and Mahindra. It's a massive global automaker, so much more one of India's largest companies. And we know them for their cars, but we also know them for agriculture,

and we found out the company's North American operations. They're also well known in Detroit for helping that city that is a truly American story in many ways. Yeah, you know what they're doing, Jason. They're providing funding and they're helping to create urban and community gardens, and they're doing more. They're really helping to address COVID nineteen's impact on locally available food supplies in inner city areas. We're talking about

Detroit Flint and Antiac. They are doing some really impressive work. Rick House, Presidency of Mahindra Automotive North America. He joined us to talk about that program. We had to begin though, about the impact of the virus on the auto industry and their company. Well, you know, COVID, like every other segment in UM, in the US industry and frankly in

the world, we've been we've been heavily impact. We We've had to a furlough employee, shut down our facilities, try to bring them back up safely, UM all the protocols and and just getting people comfortable UM with being in the office and with being UM uh and it's kind of just sort of getting back into the routine above. It has has been a bit difficult to the last few months. Obviously, we're all looking forward to hopefully a vaccine later this year and we can start to do

things in a little more normal way. But it's really disrupted our our business, including UM. I'm sure you've talked about this, including the supply chain, right because when the auto companies go down, the supply chains go down with it, and there has to be a coordinated restart or else. You know, you you don't have one part in you can't make things right. So yeah, it's been a it's been probably the most difficult year I've had in in almost the forty years I've been doing it so well.

And I do wonder, Rick, I I imagine there's a lot going on among you and your global colleagues across the Mahindra landscape in in many ways, you know, dealing with this because this is a global pandemic. This isn't at all you know, sort of regionally focused in many ways. And I do wonder what some of those conversations are like, especially because you know, back in India this has been

a massively impactful story as well. So they've they've had the same kind of contraction in the second quarter that we had. It was that was the worst one in the history of a company for the country, same as the United States, and so you know, certain segments are

impacted worse than others. Um uh. You know, automotive has been greatly impacted, but of course Mahindra's in a number of major sectors and agriculture and India has actually done pretty well this year, and it's a lot of that's because the rural areas haven't been as impacted, and there was a good monsoon season this year, and so yeah around them hittal world, depending on what segments people are in and um, and what the impact in that specific

country is, we've all had to take actions. What's the outlook look like to you at this point? What kind of visibility do you have? What kind of economic environment are you anticipating, you know, into early next year. Uh, you know, look, at this point, frankly, it's still a little hard to say. We've been feeding people money here in the United States at least for the last for

the last several months. Um, that's gonna slow down and um and and sort of stops as as as we kind of get ourselves back into the swing of things. So UM, so yeah, we're you know, I expect a contraction. The question is how long does it last. We've got a big election coming up. Um, there's a lot of stuff in play this year, so it's really hard to

say where the industry, um, where the industry goes. Um. You know, we play in our our rocks are product plays in the off road segment, which, interestingly, along with swimming pools, motorcycles, bicycles, recreational vehicles and so on. Those segments have actually done okay this year because people are using those those kinds of products to the socially distance closer to their their home right, so closer to home.

I mean, this is something that that you guys have been really focused on Carol's point and to your point, at a very holistic economic level. We're gonna talk more about this on the other side of some news, but in just a minute, sort of t this up for us what you guys have been doing, because you are sort of leveraging a lot of the aspects of the company to to help out urban farmers there in Detroit. Yeah, yeah, yes we are, and so um you know, we've we've

been involved in urban farming. It's very interesting. Um. You know, Mahindra as a company has a has a rise philosophy and it's and it's very personal for most of us. Um as we embed ourselves in different commun unities around the world. One of the things that we do and in fact, it is one of the reasons I joined the Hindran instead of maybe some other company who doesn't think like this is you go out you you you

you engage with the community. You interact with the community and as the businesses start to rise, UM, we'd like the communities to rise along with us, and so UM. When I got back from um from when I relocated back many of back in two thousand thirteen, one of the first things I did was I said, Okay, what how are we going to engage with the community, and UM,

we ultimately settled on It was sort of serendipity. I had been home not very many weeks and I was watching a show on one of the local news stations where they taught where they were talking about Detroit's large urban agriculture movement, which apparently has been kind of growing since the eighties when a former mayor, Coleman Young had a like a farm a lot program, farm a lot program.

So over the course of the last several decades, Um, you know, that started because they were trying to turn bladed, abandoned lots into in the in the useful, uh, productive pieces of property. So you know, again, over the years since the eighties, this program has grown, and in fact it's become a worldwide model, and we have people that come into the city all over the United States and other countries to see how Detroit has managed all of

this right. We looked at that situation and of course we're the largest producer of tractors in the world, and so we partnered up for the first few years with our with our with our agricultural division down in Texas and we ran the program as a joint program. But today um there are a number of their kind of feet on the boots on the ground, community organizations and small nonprofits that run these and these are just exactly the kinds of things that we like to get involved in.

It's very personal for our whole team. And we have a team of folks who loves to engage with the community. You know. It's not like you go out one day a year and go paint houses or something. Right where we can engage with these folks all year round, and that's where cost the president CEO of Mahindra in North America. I loved his perspective Carroll, in part because this is a global automaker, but more than that, this is a

global empire in many ways. So he's able to draw on not just intelligence about the car business, but intelligence about the entire global economy and also to take that down to a very local level in terms of how companies need to be thinking about the communities that are right in front of them. Man, he said it was his most difficult year that he has had in the forty years that he's been in the industry. And he said, you know, in terms of an outlook, there's just so

much going on right now. Let's not forget even I think talked about it being an election year that it's hard to know kind of where we go from here, and if it's the toughest year for someone in the car business, that's saying something. You're listening to Bloomberg this week. Coming up, my conversation with Tom Barrick, the legendary real estate investor. He's stepping back from Colony Capital. They're making some aggressive moves. A great conversation coming up. This is Bloomberg.

You're listening to Bloomberg Business Week with Carol Masser and Jason Kelly from Bloomberg Radio. Tom Barrick, that's a familiar voice to our audiences. Jason. He built, as you know so well, Colony Capital by buying distressed assets pretty much during each and every crisis over the past thirty years. But during the current downturn, you know what he's doing. He's actually selling brick and mortar properties as they look to reshape their portfolio really focus on what they are

calling digital infrastructure. So this was sort of a big moment for many reasons because I actually saw Tom Barrick in the flesh in New York City, him and his new CEO, Mark Ganzy. They came to New York, We went to their offices socially distanced for a wide ranging interview. How the pandemic, it is accelerating so much of what's

happening in an already disrupted real estate world. Check it out. Well, I think we're in transition um and as the engineers and the builders of this infrastructure, we we see where the traffic's going because once again we're entrusted with that information. And what I would tell you today is is from a network perspective, from a digital perspective, workloads are shifting from the urban core out of the suburbs in a in a pace that we've never seen in three decades.

And what I mean by that is the proliferation of network infrastructure is more prominent in the suburbs than it is in the urban core today. So data centers are now being built, Jason, on the edge. We're now fighting to deploy infrastructure or build that next generation of real estate on the edge, which is happening in smaller cities where people have moved. You know, my belief is some

of this is somewhat overblown. I think people will come back to the urban core, urban corps where really from a from a social perspective and from a cultural perspective, that is where people like to be, where they want to entertain themselves. So I don't view this as being binary in terms of, you know, nobody coming back to New York City or nobody going back to Los Angeles

or Miami. People will come back when they feel offend it and they feel confident that there's a good vaccine and that they ultimately feel like that there's a good cure. But in the meantime, the activity in the suburbs, which was largely neglected from a digital perspective, is where we're spending all of our time. And so, Tom, what do you make of that as someone who's been looking at at real estate, and it's the buying and selling of it,

the consumption of it, the creation of it. I mean, is this a. Is this a catalytic or moment or an inflection point that we will look back on and say our cities were changed, our lives were changed. I don't. I don't think so. I'm long New York City. By the way, if you were asking me if I go back with my distress hat on, the first place I would be used here. The last place I would be is in in the other end of the transportation right.

So what's happened is great, great places to live around New York City have grown from where does the train and and the subway go? And that was the key consideration is I could buy a place in Granted at a thousand dollars of foot versus a co opera condo in Manhattan at four thousand foot, and I can commute back and forth in the subway or train. I think young people are going to get very tired of the suburbs very quickly. The financial engines will exist in places

like New York, London, Paris, Los Angeles. But again it's just an excellent People here were already thinking of moving to Florida, with a confiscatory tax regime and a political situation which they weren't happy with. Whether the mayor is doing a good job or a bad job. It was perceived that it's um it's not working. You have an infrastructure here. People were worried about building a brand new

condo or co op. The streets are falling apart, the subway doesn't work, the bridges and tunnels are a hundred years old. It's just accelerating everybody's thought and saying you know what this is. This has frightened me. Life is short. I want to enjoy my kids because of the digital frontier. I have other opportunities to do, and I want to be where I don't feel the pressure of this, of

this epidemic every time I touch an elevator. My belief is that will vanish, that will go away the aftermath after this election cycle, whatever that is will will start to dissipate with with a vaccine, with the cure. And I always ask my friends, I said, great, a vaccine, you're gonna take one? Half of them? Say never? Right? So I think cities are here to stay. Suburbs are here to stay. The utilization of them is going to be different and and in a in a replicat herble way,

it's impossible to replicate New York City. And that's Tom Barrick, the executive chairman of Colony Capital, the founder arguably one of the best known voices in real estate alongside Mark Ganzy. He's the CEO of Colony Capital as of July one. And listen, this is a seminal moment, an inflection point in many ways, handing over the reins, but also an entirely new strategy that they put in place actually before

COVID nineteen, Carol, but it is all accelerating during this pandemic. Well, just interesting, right that he's normally a buyer during times of downturns and crises, and now he's actually doing some selling. So, yeah, talk about pivots during COVID nineteen. You're listening to Bloomberg Business Week coming up. While Colony, like so many other companies, are pivoting as a result of the pandemic, many of us have been turning to our pets for companionship and

fun while working from home. Jason turns out it's part of a pet boom that's resulted in about two thirds of the country now owning a pet, everyone but you apparently, And we're coming up on that. Yeah, Apparently when you're pivoting, it helps to have someone to cut a with that is Bloomberg. You're listening to Bloomberg Business Week with Carol

Masser and Jason Kelly from Bloomberg Radio. Well, Carol, as you said on our show this week, we do love to take that three sixty degree look at the world, every aspect of work in personal lives. And the other thing that I would say is we also know everything in the world is ultimately a business story, and pets are no exception. I love this next guest because you noted that in the last twenty years, pets have gone from the backyard to sleeping on our beds. I can

personally attest to that. Writing about our best friends, Mark Cushing, he's CEO, founding partner of the Animal Policy Group. He's got a great background, former government regulatory advisor, former litigator. He's got a new book out. It's called Pet Nation, The Love Affair that Changed America. Check it out. Well, I've got two cats from the same letter, Oscar and Chloe. Oscar is a fat cat. I'm ashamed to take him to the bet because he's a he's a big boy.

Chloe would be a perfect Upper east Side Manhattan princess. And then not not busy enough, we have in nine month old pappy on puppy Wow. So you know the he's got the ears of course of a butterfly, and he is a speedster who lives to chase desert lizards. Oh my good that he's he's named after Louis Baton, but you wouldn't know it. He's just life to him as a lizard and he's in pursuit. Well, you need to get him a tiffany, although based on the news today, you don't need to get him a tiff I can

get him cheap. I can get him cheap. Yeah, exactly, you get a cheap So this is obviously we're gonna this is gonna be a wide ranging conversation. But but I do want to start by this is very personal for you. I mean, you haven't always been in the pet business or in the animal business. So tell us about sort of how you got into this and then

ultimately what inspired you to write this book. So I'm supposed to say that, you know, I love animals, and I gave up my traditional law practice for that didn't work that way. I was a partner in the largest national offerm in the d C office, and I'm a hired gun, right. I got called to solve the problem for the pet industry back in two thousand five in Congress, and I had good fortune and got a good result,

and my phone started ringing off the hook. And I figured before that that that I'd do one thing and that'd be it. And fifteen years later, I'm full time. And so I I was pulled in for business reasons, and I was lucky because I caught the wave of the surge of interest in pets, and nobody saw it coming that, particularly the pet industry didn't. I don't think the pet industry, even as recently as two years ago, believed things were going to stay as good as they

are and get even better. And so I've been very fortunate, Jason, to be on the front end of a lot of issues with great clients that you all know, like Mars, Veterinarians, Zhouetta's, Royal Cann just major groups and businesses that are involved in pet pet healthcare. There's a lot of bets Harry College. So Mark, I gotta ask you, I mean, one of the things that really jumps out to me, and as has been Uh. Well pointed out by my co host.

I'm not a current pet owner, but I do have an appreciation for pets and have many in my extended family, a lot of dog lovers especially. Um. It sounds like a lot of excuse to me. But we'll just let it go first, Just let it go. Um. But market is fascinating to think about sort of the demographic in the economics of this, which I know you've studied extensively. How does that play through to this this broader industry and what does it mean in terms of whose owning pets?

While we're approaching a hundred billion a year pet industry sector in the US and right now you have six households getting close to have a pet. So, uh, it's a significant percentage. And of all the pets own are owned by millennials and gen Z's. The whole transformation of pet culture, which my book that Nation covers, began with baby boomers, but the children of baby boomers, a lot of millennials and Gen Zs have just taken it and

just surged ahead. And so you're seeing the following. They want to spend all the money it takes for pet healthcare. They want healthcare delivery for pets at the same level they get it as humans. They want designer you know, high end nutrition. They want basically care when they can, when they want it on demand, and there's really no end to what they would like to spend or are willing to spend to keep their pet comfortable, to enjoy their pet. Years ago, you couldn't couldn't think about that.

We just had a great Hyundai Christmas had last December, if we can remember far ago of five Hundays tall too small, lined up and in front of them were five dogs position tall to small. The fascinating thing, Jason, is that the Hounday executives knew and wanted you to look at the dogs, not the cars. So we've reached we've reached a point where car executives will spend millions of dollars on a thirty second ad and the entire purpose is to associate their car brand with a dog. Period.

No discussion of performance, engine, you know, miles per down, you name it. It's all about association with pets. So that that whole mindset is a cultural shift, and it plays out on the business side. You've got probably sixty private equity firms now that are investing directly in practice

petinity Practice and solidation groups. There were five about six years ago, and I get calls weekly from groups saying we've got to get into PET because we know how thriving and how much of a recession proved it's proven to be and I think is now so veterinary practices erupt ten from last year during COVID. Yeah, it's that's

a pretty good sign. Well, and it's you know, it's interesting, is I Um, I think about what Danny Blunt flower on from Dartmouth and he's walk about economics and as I've walked about masked on social distancing during the pandemic and just kind of look at, you know, garbage night, what kind of boxes people are putting out. There's been a lot of chewy boxes like it's but it's interesting to you know, you get an idea of what people

are spending money on as they've been home. Listen. We have a bark box that comes in once a month, you know, um for our dog and you know, I'm happy on counts on it. My dog's waiting for his next scout knows when it cuts at the door, you know. But but it is interesting what a big business. It's become and just seems to get greater. I think you know, Jason, we have a market asked Mark. We have a market guest that comes on UM and constantly talks about Chewy.

It's one of her favorite stocks. Well, let me give you an example that that you'll particularly appreciate. In Manhattan. I don't think any sector has changed itself to accommodate pets more and faster than the hotel sector, which is being hammered right now and COVID. So I'm I'm not trying to pick on them, just the opposite. Years ago, you know, no dogs allowed, no pets allowed, that was the standard. And you showed up in the four seasons and said meet my pappion, they'd say, were you camping

the night you you're certainly not staying here. UM. Now now hotels high end to low end have special floors for non pet owners. In other words, the hotels now pet friendly, but they will carve out one floor and say, non pet owners, this is yours. And you couldn't have thought about that two decades ago. And and that's that's across the housing sector, it's across the hotel sector. The v R b O, Airbnb. All all that is just accommodated the fact that people want that's with them and

even want to take them to work. As you know, a study was done in a great study that said workers and companies of a hundred employees are more like their company better if it's pet friendly, even if they don't have a pet. So you don't have a pet, Jason, but you like working and you like your boss more if it's a pet friendly environment. So that words out the Wall Street Journal to a piece two weeks ago on petsas perks and has now become a standard employee

benefit part of your employee package. So you look around, you know, we're just finding some piece of this every week to you know, to unfold and plug pets in. And that's that's interesting. So one thing, you know, Mark and Carol brought this up as a concerned pet owner and also as a very empathetic human being, uh and someone who thinks about the world and thinks about pets especially, and this notion that you know, a do people have really leaned on their pets during this pandemic. They've been

at home, they've been working from home. As people go back to the office, how much do you worry about And I'm not talking about separation as much as candidly like neglect. And you know people who have sort of adopted a pet for you know, out of some loneliness, which is legitimate, but now their life changes or goes back a little bit to normal and the pet, the

dog or cat especially is left behind. Well, the New York Times did a piece ten days ago that claimed at least that pet owners now when they go back, are considering they haven't decided for sure, but they're considering buying another pet to keep their current pet company, so they're not lonely. Now. Two things about that are Two things about that are interesting just quickly. One thing is yeah, one thing is bad news. There aren't enough dogs in America.

How to meet that demand and if thirty percent one out, to look the good and find one. But it just shows you that people are paying attention to their pet, and my sences are not going to neglect them. They're going to kind of deal with their home twice a week. And that's Mark Cushing, the CEO founding partner of the Animal Policy Group. As you said, he has a varied corporate and government background, but man pets. It's a massive business.

He really captures it in this new book. I loved catching up with him, and really I learned a lot as a non pet owner about everything that's going on and all the money you guys are spending on those very friends. Well, it's a huge industry and it just gets bigger and bigger. And we've seen a lot of other big, well known companies, whether it's Mars and some others,

just upping their exposure to the pet industry. So um, so great that we could wrap up with him, and that does wrap up the weekend edition to Bloomberg Business Week from Bloomberg Radio. Thanks so much for joining us. I'm Carol Masser and I'm Jason Kelly. Be sure to tune into Bloomberg Business Week Radio. That's our show live Monday through Friday, starting at two pm Wall Street Time. You can also watch the show live on YouTube. Just

sir for Bloomberg Global News. And in addition to our daily podcast, you should be subscribing download our Business Week Extra podcast this week. It features our conversation with the writer and creator of the new Netflix series Away. We know you're binging out there. This is a good one. Yeah, it absolutely is. We'll be back next week at the same time. Stay safe, everybody, This is Bloomberg.