Effective measurement of the performance of facilities requires metrics that are themselves measurable, manageable and meaningful. Objective and quantifiable measurement of portfolio performance is one of the missing links in CRE professional ranks – a worry for an industry that is heading towards extreme outsourcing. This gap also directly impacts the ability of CRE executives
REAL OPTIONS: WHAT ARE THEY AND HOW DO YOU PRICE THEM? The property investment model has evolved over decades and is fairly simple. On the proposition of ‘build it and they will come’, landlords develop and own buildings, competing for tenants with prime locations, superior images, design features, and ever-improving building services. The financial model
OUTSOURCING: FAD OR TREND? The outsourcing of property and facilities management functions is now into the second and third evolutions. The two management functions are being amalgamated in many organisations as an integrated corporate solution, and as such integrated outsourcing would, at first glance, seem the right way to go. But based on the availability
Systems have entered the real estate industry late in the piece – surprising because it is a wealthy and data-rich industry. Possibly real estate is thought to be too different. CRE applications are even less evident, probably because corporations seldom focus on this aspect of their business models. Demand for these systems has not been
As with other overhead charges, there is a belief, often correct, that nothing can be done to reduce property costs directly impacting profit and loss accounts. Worse still, in many organisations, particularly the older traditional sectors with many owned assets, property is treated as a free good. The inclination is to take and hold onto
Much of the recent discussion in corporate real estate (CRE) has been focused around structuring flexibility into a portfolio. A strategy of negotiating shorter lease terms across the portfolio has resulted. In reality, in more stable industry sectors, tenants tend to remain in their premises for periods longer than the initial lease term. Portfolio usage,
IS GOING LEAN A DREAM? Facilities managers face an ongoing paradox, constantly being asked to deliver on two conflicting portfolio objectives. First, to ensure there are short-term and flexible portfolio occupancy strategies which provide agility in the face of rapid business changes. Second, to also reduce occupancy costs – since real estate costs are inversely
Corporate real estate executives face an on-going paradox, constantly being asked to deliver on two conflicting portfolio objectives. First, reduce occupancy costs which – since real estate costs are inversely correlated to length of term of the lease – usually means committing to long-term leases or even ownership. Secondly, also ensure there are short-term and
Many in senior management have failed to be convinced that CRE has more value to add than managing real estate transactions and providing associated facility services. It is seldom recognised that well structured real estate strategies can provide strategic advantage. But why are CRE professionals struggling to build this credibility internally? CRE is not a
In an effort to drive down costs in recent years, businesses have climbed onto the outsourcing treadmill – until there was very little left. But company captains seeking to achieve competitive advantage, want more. The next step in attempting to dramatically reduce costs is off-shoring. Off-shoring can best be described as the relocating of business