Minutes from downtown shops, equine trails and golf courses, “the Cottage” in a quiet upscale neighborhood in Walnut Creek, California was advertised as a newly built, sunlit one-bedroom, one-bathroom detached unit with high-end finishes and a private patio on a half-acre.
The catch in the fine print?
In addition to the $3,250-a-month rent which included a gardener, internet and utilities, remote workers were on the hook for an additional $200 monthly work-from-home fee.
The rental listing quickly went viral, sparking a torrent of outrage in the Bay Area where tenants already pay the nation’s highest rent bills – “insane,” “absurd,” – and then spread. One person on the social media platform X said he walked away from a rental in North Carolina when the landlord told him there would be a $300-a-month home office fee.
“The Cottage” listing is no longer active and the landlords of the property did not respond to a request for comment from USA TODAY.
Will landlords start charging for work from home?
With more people working from home since the pandemic, landlords are paying closer attention to utility costs. Some charge remote workers more each month to cover the increased cost of electricity, water and heating and air conditioning but it’s rare, housing experts say.
More commonly, individual meters or a specialized billing system are used to split a building’s utility bill among tenants based on apartment size, number of rooms or people living in each unit, according to Alexandra Alvarado, director of marketing and education at the American Apartment Owners Association.
Walnut Creek is in the pricey San Francisco Bay Area market which leads the nation in annual rent growth. According to Zumper, one-bedroom rent has risen 23% to $4,180 and two-bedroom rent has gone up 26% to $6,020.
“In a competitive market, some landlords may feel they have more flexibility to test what tenants are willing to pay,” Alvarado told USA TODAY. “A hot rental market may give an owner the confidence to try an unusual fee but it doesn’t make the fee a common or a best practice.”
Work from home is latest add-on fee
With rents at sizzling highs, a growing share of renters are barely able to cover their costs. About half of renters are now considered “cost-burdened” – meaning they spent more than 30% of their income on rent and utilities, according to Harvard’s Joint Center for Housing Studies.
The rising tide of hidden add-on fees can increase housing costs by hundreds of dollars a month. Increasingly, tenants are challenging these fees in lawsuits.
“The negative reaction to this particular listing shows that renters increasingly expect transparent, predictable pricing. That same concern is driving greater scrutiny and regulation of so-called junk fees,” Alvarado said.
‘Landlords should offer work-from-home rent discounts’
Even as employers crack down on how many days a week people can work from home, studies show that about 28% of paid workdays in the Bay Area are still from home, down only slightly from 32% in 2024.
Before remote work became so widespread, leases sometimes restricted tenants from operating a business out of a rental property, but those restrictions were to address concerns such as noise or employees or customers coming to the property, not “quiet-computer based work,” Alvarado said.
Charging tenants simply for working from home “would be difficult to justify” given how common remote and hybrid work arrangements are, she said.
Stanford University economics professor Nick Bloom, who studies remote work, said landlords shouldn’t charge tenants who work from home. They should seek them out.
“I would argue working from home means tenants have a job and care about the property as it’s their office,” Bloom said. “You could argue that landlords should offer work-from-home rent discounts.”

Today, Jersey Mike’s moves from slinging subs to also slinging stock as it goes public at a roughly $7 billion valuation.
The company’s newly available shares fell slightly in volatile early trading after pricing in the middle of the IPO range. The debut marks the culmination of a years-long process to grow the company’s value.
It’s been 51 years since 17-year-old Peter Cancro took out a loan to buy the Jersey Shore sandwich shop where he worked, and not even two years since Blackstone acquired a controlling stake in the chain.
In that short time, the world’s largest private equity investor has transformed how the sandwich chain is run, bringing in outside professional managers, establishing a corporate board, and giving employees a stake in the business’s equity. It’ll be Blackstone’s public market debut of private equity’s newly popular profit-sharing strategy.
For all that rapid change, the one thing the firm hasn’t touched is the sandwiches themselves. Other than adding new ones like the Hot Italian, it kept the portions the same and sliced the deli meat fresh. According to a source with direct knowledge of Jersey Mike’s operations, the restaurant’s suppliers have not changed since the acquisition.
Here’s what Blackstone has changed at the Jersey Shore sandwich shop, and what’s stayed the same across nearly 3,300 stores.
From the Shore to the boardroom
Over the nearly five decades that Cancro was the sole owner and executive decision-maker, he grew that one sandwich shop into a nationwide business, hiring family members and paying some of them tens of millions of dollars.
Before he sold a majority stake to Blackstone for $8 billion in debt and equity in 2024, it still operated like a family-run business. As part of the deal, Cancro stepped down as CEO and became a board member. The deal gave Blackstone an 80% stake and Abu Dhabi Investment Authority a 10% stake in the business, with Cancro’s share down to 10%.
Cancro wrote in the firm’s S-1 that he decided to sell to Blackstone because of the firm’s strong experience in franchise businesses, most famously with the ultra-profitable Hilton acquisition.
Cancro was replaced as CEO by Charles Morrison, a longtime industry vet who took Wingstop public in 2015 and was most recently the CEO of Salad and Go.
The sandwich shop’s first board included Nigel Travis, former longtime CEO of Dunkin’, serving as its chairman, Abercrombie & Fitch CEO Fran Horowitz, former AutoNation CEO Cheryl Miller, and three more Blackstone executives.
Rounding out the executive level are a suite of new hires, including Michele Allen, former CFO of Wyndham Hotels & Resorts, at CFO, and Stacy Peterson, former CEO of Jeni’s Ice Cream, at COO.
Spread the wealth
With this IPO, Blackstone is doubling down on the idea that executives and workers who are incentivized to see the company do well are more likely to stay and do their best work.
It’s offering a shared ownership plan in the form of bonuses to the firm’s corporate employees, who work in suburban New Jersey. Blackstone announced in 2024 that all of its future US private equity deals would include these programs, which have become widespread in the industry.
Jersey Mike’s bonuses will be funded by Blackstone’s own payout, can be either cash or equity, and can range from 0% to 200% of an employees’ eligible compensation. The final payout is based on Blackstone’s return on its original investment and can also be prorated by an employee’s tenure at the company.
Direct employees who don’t participate in the other equity incentive programs — and have been at the firm for at least a year when Blackstone is no longer in control of the company — will get a payout. Franchisees, their sandwich-making employees, and employees of corporate-owned stores are not eligible for the ownership plan.
As is more standard, executives will also get stock grants, aligning their interests with the firm’s investors.
This will be Blackstone’s first time bringing one of these broad ownership plans public. Other examples of an IPO involving one of these plans come from industry shared-ownership evangelist KKR: Gardner Denver, now Ingersoll Rand, and Lineage Logistics. The Jersey Mike’s filing is unique in that it exposes the nuts and bolts of how their plan will work.
But it is much smaller than other examples: Jersey Mike’s had 293 corporate personnel as of the end of last year, while Ingersoll Rand said it has granted equity to more than 28,000 employees since 2017. Blackstone-owned Copeland, which confidentially filed for an IPO at the end of last year, has 18,000 employees eligible for similar ownership benefits.
Big subs, bigger business
Expansion has remained central to Blackstone’s investment thesis. The total number of stores is only up about 8.4% from when Blackstone purchased the chain. The firm is likely doubling down on Jersey Mike’s franchisee development pipeline of 1,600 potential new stores, 90% of them from existing franchise owners.
Jersey Mike’s is now taking its first continental leap to the UK and Ireland, with Peter Cancro signing a master franchise deal to open up to 300 stores in Ireland. It had already been launched in Canada the year Blackstone purchased it.
Blackstone also used its financial heft to help Jersey Mike’s refinance much of its debt earlier this year in a $760 million whole-business securitization. This has resulted in debt levels that are high relative to franchised peers, although the company’s profit margins are generally superior, according to the Wall Street research firm Gordon Haskett.
The most obvious signs that expansion is the long-term plan are the specifics of the deal. Blackstone may be bringing Jersey Mike’s public less than two years after buying it, but it’s doing so at roughly the same valuation, inclusive of debt, that it paid. That implies that Blackstone will hold onto its shares for a while, waiting for its plan to fully pay off. Blackstone has historically held shares of firms it IPOed for years after a transaction, including Hilton, which it held for more than 4 years after the IPO.
They are, of course, recouping some of their costs. For one, the recent debt raise included a dividend for Blackstone, and the firm is selling the lion’s share of the IPO offering, at more than 26 million shares. Still, it will retain about two-thirds of the company’s voting power. The IPO will also mint nearly 14 million new shares.
In other words, they’re going to be in the driver’s seat for a while. And with a projected future of 7,500 US restaurants and 15,000 globally, that may be a very lucrative position.

Shares of Jersey Mike’s fell about 3% during trading on Thursday afternoon after the company made its public market debut on the New York Stock Exchange under the ticker “JMKE.”
The stock opened at $21 per share, below its initial public offering pricing of $23 per share, at the midpoint of the expected range of $21 to $25 per share.
Jersey Mike’s sold 43.5 million shares, raising about $1 billion and valuing the company at $7.3 billion. With those proceeds, the chain is now among the largest-ever initial fundraises for a restaurant IPO.
Jersey Mike’s has nearly 3,300 locations, making it the second-largest hoagie sandwich chain in the U.S. behind Subway. It’s now the largest public chain in the category.
The company reported net income of $55 million on total revenue of $724 million last year. Its same-store sales increased 3% over the same period. The metric tracks sales growth at restaurants open at least a year.
Broadly, diners are eating out less often or seeking deals to save money, and the restaurant industry has seen traffic and sales soften. But Jersey Mike’s has largely bucked the trend, and its high average unit volumes and asset-light franchise model made the stock attractive to investors.
CEO Charlie Morrison told CNBC that Jersey Mike’s customer base typically skews “a little higher income,” insulating the chain from some of the pullback in consumer spending.
“We’re seeing the consumer come back,” Morrison said. “We’ve seen positive transition growth. In fact, most of our same-store sales growth this year to date has been driven primarily by transaction growth.”
Jersey Mike’s successful IPO is a positive harbinger for other consumer companies looking to go public. Rival restaurant company Inspire Brands, which counts Dunkin’ and Jimmy John’s among its brands, has confidentially filed for an initial public offering and could easily snatch Jersey Mike’s title for biggest-ever restaurant IPO.
Clothing company Reformation is also expected to make its public market debut on Thursday; the retailer priced shares at $15, on the low end of its expected range of $15 to $17.
Jersey Mike’s founder Peter Cancro began working at a Jersey Shore sandwich shop at age 14 in 1971. Four years later, he pulled together enough money to buy Mike’s Subs. Cancro later changed the name and began franchising the chain. Today, franchisees operate 99.2% of Jersey Mike’s locations.
In late 2024, Jersey Mike’s announced that Blackstone had bought a majority stake reportedly valued at around $8 billion including debt.
After the transaction closed, Jersey Mike’s tapped Morrison as its chief executive. He previously led Wingstop for more than a decade, including during the chicken wing chain’s own IPO.
Morrison said that he sees a lot of similarities with Wingstop. Like the chicken wing chain, Jersey Mike’s is mostly franchised and generates free cash flow for investors.
Jersey Mike’s plans to use the proceeds from the offering to pay down debt and general corporate purposes.
Looking ahead, the chain plans to expand its international reach.
The vast majority of its restaurants are in the U.S., a relatively mature market for hoagies. Cancro, who has retained some equity in Jersey Mike’s, signed a master franchise agreement to bring Jersey Mike’s to the United Kingdom and Ireland.
Long term, Jersey Mike’s sees the potential for 15,000 restaurants worldwide — half in the U.S., half in international markets.
“One of the benefits of being a publicly traded company on the New York Stock Exchange is that we get a lot of awareness of the brand, not only in the U.S., but also around the world,” Morrison said.

U.S. economic growth slowed unexpectedly in the second quarter of the year, according to the Commerce Department’s advance estimate.
The Bureau of Economic Analysis (BEA) on Thursday released its advance estimate of second-quarter GDP, which showed the economy grew at an annualized rate of 1.5% in the three-month period including April, May and June.
That figure was below the 2.1% growth estimate of economists polled by LSEG.
It comes after the U.S. economy grew at a rate of roughly 2.1% in the first-quarter of 2026. Taken together with the advance second-quarter estimate, that suggests the U.S. economy grew about 1.8% in the first half of this year.
Last year, the U.S. economy grew at an annualized rate of 4.4% in the third quarter and 0.5% in the fourth quarter, which contributed to a growth rate of about 2.1% for 2025 as a whole.
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The BEA reported that the main categories that contributed to the rise in real GDP in the second quarter were increases in consumer spending, investment and exports – which were partly offset by a decrease in government spending. Imports increased in the second quarter.
The increase in investment was primarily due to increases in equipment and intellectual property products. Equipment increases were widespread and led by industrial, transportation and information processing equipment, while the rise in intellectual property products was mainly related to software and research and development amid the AI buildout.
Those gains were partly offset by decreases in private inventory investment, particularly wholesale trade, and nonresidential manufacturing structures.
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Real final sales to private domestic purchasers, which is the sum of consumer spending and gross private fixed investment, rose 3.9% in the second quarter – an acceleration from the 1.7% reading in the first quarter.
A revised estimate of second quarter GDP is scheduled to be released in late August, while the final revision will be published at the end of September.
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What experts are saying
EY-Parthenon chief economist Gregory Daco noted that the “main engines of activity were resilient and broadening consumer spending and surging business information processing equipment and intellectual property products investment linked to AI.”
“Looking ahead, we continue to expect moderate consumer spending growth and AI-led business investment to support real GDP growth into 2027. The most immediate downside risk remains a prolonged escalation of the Middle East conflict that lifts inflation and long-term interest rates and pushes the Federal Reserve toward renewed policy tightening,” Daco said, adding that would weigh on consumer demand and private sector investment.
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Michael Pearce, chief U.S. economist at Oxford Economics, said that the “subdued 1.5% annualized rise in GDP in Q2 underplays the economy’s strength as it reflects a drag from rising imports and falling inventories that won’t be sustained for long. We expect an inventory rebuilding cycle to help drive economic growth back above 2% in the second half of the year.”
“There’s little to change the Federal Reserve’s judgment that the economy and labor market remain resilient, meaning the near-term focus will remain on inflation, which came in a touch weaker than expected in June, supporting the decision to leave interest rates on hold,” Pearce added.

The average long-term U.S. mortgage rate rose for the fourth consecutive week to its highest level in a year, another setback for prospective homebuyers hoping for a break from elevated home loan borrowing costs.
The benchmark 30-year fixed rate mortgage rate rose to 6.66% from 6.58% last week, mortgage buyer Freddie Mac said Thursday. One year ago, the average rate was 6.72%.
Higher mortgage rates can add hundreds of dollars a month in costs for borrowers, limiting homebuyers’ purchasing power. As rates rise, that can lead prospective home shoppers to delay buying a home, one reason U.S. home sales have been sluggish this year.
Borrowing costs on 15-year fixed-rate mortgages, often sought by borrowers refinancing a home loan, also rose this week. That average rate increased to 6.04% from 5.96% last week. A year ago, it was at 5.85%, Freddie Mac said.
Mortgage rates are influenced by several factors, from the Federal Reserve’s interest rate policy decisions to bond market investors’ expectations for the economy and inflation. They generally follow the trajectory of the 10-year Treasury yield, which lenders use as a guide to pricing home loans.
Rates have been mostly rising this year as the Iran war has driven crude oil prices sharply higher, fueling expectations of hotter inflation. That’s pushed up long-term bond yields relative to where they were before the conflict began in late February, causing mortgage rates to trend higher.
The 10-year Treasury yield was 4.66% at midday Thursday on the bond market. It was just 3.97% in late February, before the war broke out.
The average rate on a 30-year mortgage is now the highest it’s been since July 31, 2025, when it was at 6.72%. As recently as late February, the average rate dropped slightly below 6% for the first time since late 2022.
The latest increase in mortgage rates comes a day after the Federal Reserve left its key interest rate unchanged as it wrestles with how to tame stubbornly high inflation, which has been stuck above the central bank’s 2% target for more than five years.
During the central bank’s two-day monetary policy meeting this week, three regional Fed bank presidents dissented in favor of higher rates to combat high prices.
That’s a signal that Fed members are no longer in lockstep on inflation and that their next move is not going to be a rate cut, said Anthony Smith, senior economist at Realtor.com.
“With the Fed signaling that its next move is more likely a hike than a cut, near-term rate relief looks unlikely,” Smith said. “Because oil remains the primary channel through which the Iran conflict feeds inflation, a de-escalation and a reopening of the Strait of Hormuz remains the clearest path back toward lower rates.”
The central bank doesn’t set mortgage rates, but its decisions to raise or lower its short-term rate are watched closely by bond investors and can ultimately affect the yield on 10-year Treasurys.
While average long-term mortgage rates remain lower than they were at this time last year, their upward trajectory has weighed on home sales this year. Seasonally adjusted sales of previously occupied U.S. homes were up 0.7% from January to June compared with the same period last year, but they’re still hovering close to a 4-million annual pace far short of the historic norm that is closer to 5.2-million.
The trend has extended the national housing market slump that began in 2022, when mortgage rates began to climb from pandemic-era lows. Sales of previously occupied U.S. homes were essentially flat last year, stuck at a 30-year low.
The latest data on mortgage applications show that the upward trend in mortgage rates has given some would-be homebuyers reason to pause.
Mortgage applications, which include loans to buy a home or refinance an existing mortgage, fell 6.4% last week from the previous week, according to the Mortgage Bankers Association.
“While incoming economic data will continue to shape the outlook for interest rates, elevated borrowing costs remain a challenge this summer for many prospective homebuyers,” said MBA CEO Bob Broeksmit.