many may be too young to remember but Eddie Lampert did this with Sears in the 80s and 90s as a thinly veiled attempt to turn the company into some kind of obscure land broker. It did not end well, and serves to this day as a textbook example of ideology eclipsing principled, well researched business decisions.
in the article Bloomberg attempts to invent reasons this practice is dicey for Amazon that dont involve "you arent a real estate company" but fall short. the regulatory landscape they paint simply doesnt exist in the places (texas) they want to buy land.
the real reason is likely to prevent competitors from setting up their own warehouses, as Lampert frequently did the same thing by buying out anchors and real estate in an attempt to funnel customers back into sears during its declining era as it was being bled dry by VC style profit chicanery that doesnt involve store refreshes or new markets.
As a counter argument McDonald's does the same thing and is quite successful at it. When you open a franchise you have to build on the main corp land and pay for rent on it in perpetuity, on top of franchise fees .
McDonalds is also careful to ensure all their franchises are in locations that will make the owner a ton of money (if they run the business well) and so it is a good deal. Not all companies work this way though.
> many may be too young to remember but Eddie Lampert did this with Sears in the 80s and 90s
Eddie Lampert didn't start ESL Investments until 1988 (and he was only 25 then). ESL didn't start destroying Sears / itself until 2004 (https://www.investopedia.com/news/downfall-of-sears/ "Kmart announced it would buy Sears for $11 billion in Nov. 2004..." It was via the Kmart merger that ESL came to control Sears, ESL having taken control of Kmart after Kmart's bankruptcy in 2002).
Anyway, you might be remembering a different company or different "business genius"?
Amazon is buying land piecemeal, lot by lot—probably roughly at market value, then. I don't think it's really comparable to someone buying Sears because they think Sears's land holdings are undervalued.
At worst, they're exposing themselves to the whims of the commercial real estate market as a whole. Not like Sears, where the value of their holdings depended on a pretty niche market—the value of malls.
A lot of businesses sell and lease back their real estate. That way their capital isn’t tied down in non core competencies. Also they can insulate themselves from real estate booms and busts.
Meanwhile, every grocery chain does it, Walmart does it (Successfully!), Mcdonalds does it, and more.
The later is more interesting because it's a franchise model, and if a franchisee is successful, there's usually nothing in the franchise agreement to stop corporate from setting up shop nearby. Maybe not across the street or a block down the road, but yes.
Also quite common w/ lapsing leases with walmart and such, they take out 15-25 year leases, and if it fits their margins, they will build nearby and ride the lease out.
I'm not sure how to investigate who owns lots of lands, but I think the Walmart near me did the same. They used to be in a big building, but then after some time cut down the forest literally nextdoor and built a bigger Walmart there. The original building still stands but is leased by another brand.
I use to work in a conglomerate that I did not associate with real estate. After working there for a few years and becoming friends with some people in the corporate real property division, I realized they randomly own a ton of land everywhere and that real estate is just a useful core part of any conglomerate. It's a nice place to park assets, obtain rent, and to rent for offices yourself.
I imagine a lot of conglomerates and large companies do this, because at a certain scale, it's more of a "why not?" question.
correct! PE was more of a fever dream at sears as well. capex and opex was the most visible and agonizing part of his "vision" but certainly the 5bn in stock buyback he instituted makes harley davidson look like a food truck in comparison. under Eddie, sears made money by selling the idea and concept of sears on paper, not tangible products at the malls it occupied.
the whole thing devolved from a value trap to many people outright calling Lampert a thief who orchestrated the downfall of Sears intentionally. three years ago he even threatened to stop payment of sears and kmart pensions during bankruptcy proceedings.
What happened with Sears is very different. Somehow, Eddie Lampert got Sears to divest itself of its real assets and was then going to lease them. Some other company of Eddie Lampert's ended up owning the real estate. That company never had issues.
I don't think buying of real estate was their downfall - it was the other practices - as you point out. The real estate portion may have actually delayed the inevitable downfall.
"serves to this day as a textbook example of ideology eclipsing principled, well researched business decisions." ...sounds satirically like a lesson the Vatican is learning harshly right now.
This has always been Amazon's strategy. Amazon is not a server company, an ecommerce company, a grocer, or any of the other seemingly random things they do.
The common thread running though all of their lines of business is to create businesses with complex problems, solve those problems incredibly well, then sell those solutions to other companies. Amazon uses themselves as their first-and-best customer [1]. AWS, Prime and all of their best solutions work in this way. The whole company is organized to support this strategy.
The fact that Amazon is expanding their warehouse capabilities beyond their needs and building deeper into the stack by getting into real estate development is a natural continuation of this strategy.
> If both of these stories are true, it makes me wonder why they're acquiring so much real estate.
Most likely a low-cost option to expand at their leisure.
1. In general land will be cheaper now than in 50 years. Even if current prices are high, the fluctuations will look like a blip in a few decades.
2. They can lease the land to minimize holding costs (taxes, etc.).
3. They block out competitors from deals.
4. They can expand their capacity as needed when needed.
I know several wealthy universities I have been affiliated with have done this. Whenever real estate near the university was for sale, they were the buyer. Price really didn’t matter (a “high” price was fine). They left the buildings as they were and used them for the same uses. Then when they wanted to expand for a new facility or whatever, they just wrapped up all the leases, knocked the old stuff down, and built the new thing.
People wonder why they paid so much for the land, but it always looked like a genius move over time.
Part of King Henry VIII's fight with the Catholic Church was due to the amount of rent-seeking that was going on in England. They were such a ridiculously massive land owner by that point that they threatened the Crown.
Little different- the church doesn’t pay property taxes. Amazon does, unless they have a religious investment arm.
If I had to guess, I’d say land purchases are some sort of vehicle to filter profits for tax purposes. There’s a million rules that benefit property owners for that purpose.
They could just be leasing out space in locations where they overbought relative to short term needs, but expect to need the capacity later. E.g. project out steady 10% YoY volume growth with a 5-year real estate cycle for warehouse space, and you'd def get some medium-term regional overcapacity/shortfalls.
EX a small brewery building a 20+ barrel setup as that is the predicted need in 3-5 years then leasing or partnering use of half their facility while building their brand and distribution network. Then when ready they have the capacity to 'expand' without the costs of said expansion.
For startups/new breweries it can be a double edged sword leading to high initial debt or overhead costs but with the right leadership/strategy/product it definitely pays out over time.
Amazon thinks long-term. They have a glut of warehouse space at the moment, and it is costing them dearly, but they probably hope to grow back into it when the upcoming recession is over. If Amazon successfully launches their program to buy with Prime from other stores, they could probably fill up their extra warehouse space pretty quickly. Think of Amazon handling logistics for every small retailer and even some big ones, regardless of whether they sell on amazon.com.
They can achieve a faster last-mile experience if their facilities are closer, and this space is now in contention with Walmart already beating them to the punch on drone delivery. To compete with big-box retailers they increasingly have to act like one, which is a very deep change to their e-commerce business. There is a strong chance here that they get outcompeted.
Exactly, the tables have turned and suddenly those large Walmart and Target stores are basically customer-manned warehouses that they can also ship from. Best Buy is in on it, too - order from them and half the time the product will ship from some Best Buy store somewhere instead of from a warehouse.
Even if online sales are slowing overall maybe it is still growing in some areas, requiring more capacity. As for the land purchasing, maybe it is partly an investment to get cash off the books and/or positioning for some long term strategy (this is just a guess, I don't know much about how large businesses operate).
This. Amazon no doubt has reasons to buy land that it _might_ want to use for warehouses, etc., but they are also just stuffing money into real estate because it's an inflation hedge. The very beginning of the article admits that they were in competition with hedge funds for some of their purchases.
Purchasing real-estate commercial or retail primarily for speculation should be taxed/disincentives. Basic needs with no alternatives should be shielded from speculation forces
Amazon have a colossal amount of cash sat in a variety of banks, investments and probably rainbows. It makes damn good sense to splurge, sorry liquidate, strange and probably slightly dodgy financial instruments into tangible thingies. It also makes sense to diversify your portfolio generally. Amazon also need quite a lot of strategically placed parcels of land for its warehouses, depots and what not.
If I was Amazon, I would be buying land as fast as my grubby little paws could do so, with a healthy nod to debt to value. The beauty of this is when you have shit loads of cash at hand you can grab loads of long term investments like land and win/win and you even tend to find "incentives" from grateful local govt.
In this game if you get bored of buying the usual stuff like London and Texas etc, you can also grab the bits of the Caribbean that the cruise sharks have left behind. Ideal for a party island.
The placement of the land for Amazon is very strategic. Those warehouses don't just happen anywhere. Usually they are also very close to a freeway ramp because this makes it easier to get product in and reach customers. A lot of other businesses like Costco favor these same parcels for these same reasons. You'd think there would be a lot of places like this, but to be honest these sorts of huge parcels required for these businesses are rare and valuable real estate in cities. A lot of places are pretty built out already and getting a huge lot like that zoned for this use, let alone near a highway that's near a population center, is not an easy thing. I'm betting there are only a couple dozen sites like that available on the market nationally at any given time.
The article notes that online sales growth has slowed, but honestly I don't think that matters. Amazon is building out their own logistics and that'll be useful to them even if online sales were flat. Even beyond their own deliveries, there could be an AWS-style business there.
I'm surprised that Amazon doesn't own apartment complexes. Build a multi-level basement as a fulfillment warehouse, then stack housing on top. The housing would have 10 minute delivery and be a great way to further accustom people to Amazon being the place to get everything.
That sounds awful. An apartment where you have semis pulling up at all hours delivering cargo? This is why we have zoning laws to avoid people building warehouses in residential districts.
How is this really that different from city centre multi use buildings where there are stores on the ground floor and living space on the upper floors? Especially if some of those are served by gig-economy delivery couriers.
Those stores get stocked somehow- usually not by semis.
Denying mixed use because it might be noisy for hypothetical residents is how we wound up with the current disaster that is American urban/suburban planning
If they build the towers tall enough, or put in only minimal windows, then only the lower floors will be inconvenienced. These floors can be reserved for the Amazon workers. /s
i think the ordering matters a lot: warehouse added to residential space: NO. apartment added to an industrial space: okay. people will put up with a lot of noise (e.g. those who live under a flight path near the airport), just so long as they knew what they were signing up for.
I tend to agree, although if it costs less to rent and have 10 minute Amazon delivery? I might go for it. I've lived next to train lines and highways that are louder.
Basements are by far the most expensive parts of apartment building. It's one of the reasons that reducing parking requirements for apartment buildings is a good way to make housing more cost-effective to build and therefore to increase housing supply (last I heard).
Yeah but parking above ground is probably cheaper than building out apartments. I've lived in buildings where the first 6 or 8 floors were parking. And a parking space rented for several hundred a month, on top of your apartment rent.
expensive to build, but less desirable for anyone (but parking) so there's no incentive to build much. It will definitely be more expensive than a warehouse 45 minutes away - even in the most expensive cities (where they do build basements to the extent that they can before they hit subways and whatever).
In addition to the drawbacks outlined in other responses, human living situations are too unpredictable to make that kind of arrangement desirable. Inevitably, there will be a plumbing issue because someone left a bath running, or a medical emergency causes unforeseen traffic challenges, or a fire breaks out.
The more delivery productivity you stack on top of this infrastructure, the bigger the impact from an unforeseen issue... and humans can introduce a lot of unforeseen issues.
Amazon can't build apartment complexes on top of their warehouses because many of their warehouses are already 3 or 4 floors, and the obvious zoning issues of building complexes in the middle of nowhere with a bunch of other warehouses.
So dystopian. You can imagine the vending machine kiosk on the first floor— no, the Alexa built into every unit- that’s ready to deliver anything you wish, and accept your rent payment.
I used to joke that Amazon should buy up the housing in SLU and then between Amazon sales and rent they'd get 90% of their costs of employment back as revenue.
I don't live in US, and there is no amazon specifically catering to the country I live in, but my experience with Amazon as a shop has been that it is a really bad user interface, with crappy search, filled with a bunch of questionable "spam" products.
I wonder if this is the case in US also, or maybe just my individual experience. It is very hard for me to get how a company so successful has such a crappy flagship product.
It’s really nice for my 3D printing hobby since most of the brands I’m buying are based in China or Europe (mostly China). They send over a shipping container of printers and Amazon handles fulfillment so I get the stuff in a few days instead of waiting 45 days and pay $100 shipping to get a 20 pound device delivered. They also have all the replacement parts and stuff in their warehouses.
Also, their returns process is painless. I thought I’d support local workers and had been shopping at Hobby Lobby instead of using Amazon. For my trouble, when I tried to return an airbrush that didn’t suit my needs (I used it once) they treated me like a criminal, it was a whole production.
With Amazon I just head to the Whole Foods down the street (or Kohls sometimes?), return it, and get credited almost instantly.
I do think Walmart is putting a lot of effort into their online offerings and if you can return online purchases in store that’d be a huge win. We bought my wife’s MacBook Air off Walmart’s online store and it was super convenient.
Never once in my history of ordering on Amazon have I received a fake, spam, or bait-and-switch product.
I have deliberately purchased non-name brand products, and sometimes I have received defective products, as one would shopping anywhere, but even then Amazon's customer services and return process is second to none. It shocks me that everyone on HN and other popular forums has very little success buying on Amazon.
It has a medium level of spam, but if you stick to name brands sold by amazon, you generally get what you pay for.
It's replaced the department store, and usually has better service / return policy than a department store (Target etc.).
Costco might be the exception but generally I don't go to costco to search for a specific product. They either have some general version of a product, and if I'm willing to buy that I will; swim goggles for example. Perhaps I want TYR swim goggles. Costco will have better pricing on Speedo goggles but won't sell the TYR mirrored version I'm looking for. Click, bought on amazon, arrives next day.
The flagship product is the logistical operation and it is pretty damn far from crappy. I can't speak for everywhere, but at least in most parts of the US, they can get you damn near anything on the same day. For products where you already know what you want in terms of brand, seller, and quantity, or regular recurring purchases of staple goods (cat litter, paper towels, dish soap, anything undifferentiated that you need to repeatedly purchase), even groceries now thanks to buying Whole Foods (provided you have the upscale price point that makes you willing to shop there to begin with), it's about as perfect an interface as you could hope for. Find and click in under a minute and you can probably have most goods in a few hours, at most next day.
If you're trying to discover new products of unknown quality and reputation, then it's not so good. For whatever reason, that seems to be the use case people focus on when criticizing Amazon on Hacker News, but I don't see how that can possibly be the dominant use case. Most of what people ever buy is not something brand new to them that they know nothing about.
I'm looking through my last several months of purchases here, and I'm seeing a bunch of automotive cleaning fluids, mostly from Adam's, polishing compounds and a respirator from 3M, a bunch of power tools from DeWalt, a Bose speaker. Known brands from reputable sellers, every item what I wanted and it got here quickly. In some cases, I either tried to or had to purchase elsewhere. For instance, Amazon had most of the DeWalt power tools I wanted, but was out of stock on rotary polishers, so I had to get it from some place called Acme Tools, and it took a week and a half. Amazon got me everything the next day. (I had a bunch of stuff stolen from my garage is why I needed all this at around the same time.) I tried to purchase the Bose speaker from Best Buy since I have one a five minute drive from me, and their website claimed it was in stock and I could pick it up the same day, but then right before the pick up window, they texted me to inform me they didn't actually have it and wouldn't for another week. So I canceled the order, went on Amazon, and they had free same day delivery.
It should be obvious that anything that goes from not existing 25 years ago to top five market cap company in the world is probably offering value somehow.
Amazon has stunning logistics. I’ve almost never received anything late over the last 10 years and if there’s anything wrong with the product they just refund my money. There is some spam that’s unavoidable with opening up the platform to third party sellers but I think it works very well overall.
Amazon is one of the most trusted brands in America. It is almost as trusted as USPS (the top trusted brand) and is, in general, considered by most Americans to be a reliable, safe, and high-performance source of goods.
I hate Amazon as much as the next guy but IME international Amazon and US Amazon are completely different things and aren't really comparable, they just have a similar GUI. US Amazon has nearly any consumer product you'll buy (from most food up to really expensive stuff like small boats and sheds) and almost all of it shows up in 1-2 days with minimal shipping cost.
I know people in Canada and it's nothing like that. What you can find is crazy expensive and it it takes weeks to ship.
I have had friends receive items like candles already used or paint brushes already used.
I've been duped into buying travel size bottles of mouthwash, toothpaste, soap, etc because the seller prices them at or around the same as full sized items.
I guess that's on me for not paying attention to the weight though...
Up until the mid-2000's Amazon was mainly a bookstore with a very good catalog and recommendation system. Then it became the pile of spam that it is today, a marketplace of sellers worse then Mos Eisley.
Or some kind of regulation limiting how much you can actually own. If we can regulate eg. radio spectrum (which is a limited resource too), why not land too?
This is very hard to do in practice. Bezos could spin up a thousand new companies within days and use them to buy property.
Plus we shouldn't restrict ownership when that ownership is put to productive use. Buy up thousands of acres for for a ranch or to build factories is fine. Buying up land just to sit on it is bad for society, and that's a problem that LVT addresses.
The financial industry has hijacked and transformed capitalism. Less industrious and more rent-seeking. Adam Smith et al would be turning in their graves.
Readit News
in the article Bloomberg attempts to invent reasons this practice is dicey for Amazon that dont involve "you arent a real estate company" but fall short. the regulatory landscape they paint simply doesnt exist in the places (texas) they want to buy land.
the real reason is likely to prevent competitors from setting up their own warehouses, as Lampert frequently did the same thing by buying out anchors and real estate in an attempt to funnel customers back into sears during its declining era as it was being bled dry by VC style profit chicanery that doesnt involve store refreshes or new markets.
Eddie Lampert didn't start ESL Investments until 1988 (and he was only 25 then). ESL didn't start destroying Sears / itself until 2004 (https://www.investopedia.com/news/downfall-of-sears/ "Kmart announced it would buy Sears for $11 billion in Nov. 2004..." It was via the Kmart merger that ESL came to control Sears, ESL having taken control of Kmart after Kmart's bankruptcy in 2002).
Anyway, you might be remembering a different company or different "business genius"?
At worst, they're exposing themselves to the whims of the commercial real estate market as a whole. Not like Sears, where the value of their holdings depended on a pretty niche market—the value of malls.
The later is more interesting because it's a franchise model, and if a franchisee is successful, there's usually nothing in the franchise agreement to stop corporate from setting up shop nearby. Maybe not across the street or a block down the road, but yes.
Also quite common w/ lapsing leases with walmart and such, they take out 15-25 year leases, and if it fits their margins, they will build nearby and ride the lease out.
I imagine a lot of conglomerates and large companies do this, because at a certain scale, it's more of a "why not?" question.
The flameout of those companies under his direction has been much more spectacular than a grinding down since the 80s!
Don't you mean PE, not VC?
the whole thing devolved from a value trap to many people outright calling Lampert a thief who orchestrated the downfall of Sears intentionally. three years ago he even threatened to stop payment of sears and kmart pensions during bankruptcy proceedings.
https://amp.theguardian.com/commentisfree/2021/apr/05/bill-g...
Also, McDonalds became a real estate play long ago
https://www.wallstreetsurvivor.com/mcdonalds-beyond-the-burg...
If both of these stories are true, it makes me wonder why they're acquiring so much real estate.
0: https://www.techradar.com/news/amazon-now-has-too-much-wareh...
The common thread running though all of their lines of business is to create businesses with complex problems, solve those problems incredibly well, then sell those solutions to other companies. Amazon uses themselves as their first-and-best customer [1]. AWS, Prime and all of their best solutions work in this way. The whole company is organized to support this strategy.
The fact that Amazon is expanding their warehouse capabilities beyond their needs and building deeper into the stack by getting into real estate development is a natural continuation of this strategy.
[1] https://stratechery.com/2016/the-amazon-tax/
Most likely a low-cost option to expand at their leisure.
1. In general land will be cheaper now than in 50 years. Even if current prices are high, the fluctuations will look like a blip in a few decades.
2. They can lease the land to minimize holding costs (taxes, etc.).
3. They block out competitors from deals.
4. They can expand their capacity as needed when needed.
I know several wealthy universities I have been affiliated with have done this. Whenever real estate near the university was for sale, they were the buyer. Price really didn’t matter (a “high” price was fine). They left the buildings as they were and used them for the same uses. Then when they wanted to expand for a new facility or whatever, they just wrapped up all the leases, knocked the old stuff down, and built the new thing.
People wonder why they paid so much for the land, but it always looked like a genius move over time.
Similar concept in my opinion.
Same reason as the Catholic Church. They aren't making more land any time in the foreseeable future.
If I had to guess, I’d say land purchases are some sort of vehicle to filter profits for tax purposes. There’s a million rules that benefit property owners for that purpose.
For startups/new breweries it can be a double edged sword leading to high initial debt or overhead costs but with the right leadership/strategy/product it definitely pays out over time.
Because for their purposes, it's better to have self-managed real-estate than depending on what might be on the market at a given time
Does it make sense to rent a warehouse then get hit with a rent hike after 10yrs or something? No
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But I rather exclude gold and buy assets with cashflow only.
If I was Amazon, I would be buying land as fast as my grubby little paws could do so, with a healthy nod to debt to value. The beauty of this is when you have shit loads of cash at hand you can grab loads of long term investments like land and win/win and you even tend to find "incentives" from grateful local govt.
In this game if you get bored of buying the usual stuff like London and Texas etc, you can also grab the bits of the Caribbean that the cruise sharks have left behind. Ideal for a party island.
lol etc
Those stores get stocked somehow- usually not by semis.
The more delivery productivity you stack on top of this infrastructure, the bigger the impact from an unforeseen issue... and humans can introduce a lot of unforeseen issues.
Amazon can't build apartment complexes on top of their warehouses because many of their warehouses are already 3 or 4 floors, and the obvious zoning issues of building complexes in the middle of nowhere with a bunch of other warehouses.
https://en.wikipedia.org/wiki/Company_town
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Frighteningly they have almost 1 million employees in the US, which is more than the population of a handful of states.
I wonder if this is the case in US also, or maybe just my individual experience. It is very hard for me to get how a company so successful has such a crappy flagship product.
Also, their returns process is painless. I thought I’d support local workers and had been shopping at Hobby Lobby instead of using Amazon. For my trouble, when I tried to return an airbrush that didn’t suit my needs (I used it once) they treated me like a criminal, it was a whole production.
With Amazon I just head to the Whole Foods down the street (or Kohls sometimes?), return it, and get credited almost instantly.
I do think Walmart is putting a lot of effort into their online offerings and if you can return online purchases in store that’d be a huge win. We bought my wife’s MacBook Air off Walmart’s online store and it was super convenient.
I have deliberately purchased non-name brand products, and sometimes I have received defective products, as one would shopping anywhere, but even then Amazon's customer services and return process is second to none. It shocks me that everyone on HN and other popular forums has very little success buying on Amazon.
It's replaced the department store, and usually has better service / return policy than a department store (Target etc.).
Costco might be the exception but generally I don't go to costco to search for a specific product. They either have some general version of a product, and if I'm willing to buy that I will; swim goggles for example. Perhaps I want TYR swim goggles. Costco will have better pricing on Speedo goggles but won't sell the TYR mirrored version I'm looking for. Click, bought on amazon, arrives next day.
If you're trying to discover new products of unknown quality and reputation, then it's not so good. For whatever reason, that seems to be the use case people focus on when criticizing Amazon on Hacker News, but I don't see how that can possibly be the dominant use case. Most of what people ever buy is not something brand new to them that they know nothing about.
I'm looking through my last several months of purchases here, and I'm seeing a bunch of automotive cleaning fluids, mostly from Adam's, polishing compounds and a respirator from 3M, a bunch of power tools from DeWalt, a Bose speaker. Known brands from reputable sellers, every item what I wanted and it got here quickly. In some cases, I either tried to or had to purchase elsewhere. For instance, Amazon had most of the DeWalt power tools I wanted, but was out of stock on rotary polishers, so I had to get it from some place called Acme Tools, and it took a week and a half. Amazon got me everything the next day. (I had a bunch of stuff stolen from my garage is why I needed all this at around the same time.) I tried to purchase the Bose speaker from Best Buy since I have one a five minute drive from me, and their website claimed it was in stock and I could pick it up the same day, but then right before the pick up window, they texted me to inform me they didn't actually have it and wouldn't for another week. So I canceled the order, went on Amazon, and they had free same day delivery.
It should be obvious that anything that goes from not existing 25 years ago to top five market cap company in the world is probably offering value somehow.
I know people in Canada and it's nothing like that. What you can find is crazy expensive and it it takes weeks to ship.
I've been duped into buying travel size bottles of mouthwash, toothpaste, soap, etc because the seller prices them at or around the same as full sized items.
I guess that's on me for not paying attention to the weight though...
But they did get their foothold selling books.
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Plus we shouldn't restrict ownership when that ownership is put to productive use. Buy up thousands of acres for for a ranch or to build factories is fine. Buying up land just to sit on it is bad for society, and that's a problem that LVT addresses.