There's plenty of counterexamples (including several I've worked for) who have somehow succeeded despite spending relatively modest amounts of money to make the office a pleasant place instead of a loud dump with sawhorse desks and 20 year old carpeting. If you're complaining about sfbay rates, well, that's what office space costs here.
Believing spending well under one engineer's annual salary made a bad outcome more or less likely is nothing other than dumb.