Current CRE financial management practices predominantly reflect a view of real estate as an investment vehicle. The author argues that for the CRE manager, real estate is not an…
Abstract
Current CRE financial management practices predominantly reflect a view of real estate as an investment vehicle. The author argues that for the CRE manager, real estate is not an investment vehicle, but rather a raw material in his firm’s production process. Under the raw materials procurement approach, the CRE manager’s goal is to optimise reliability, flexibility and cost across the CRE portfolio. Optimisation is attained by pursuing a financing strategy of asset/liability matching; the CRE manager should attempt to match the duration of his real estate financial commitments to the real estate’s expected productive life as a raw material. The author outlines a methodology for implementation built around two key manageable variables: commitment and control.
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In today’s highly charged economic environment, all organisations have to make the most of all of the resources and assets at their disposal. Within corporate real estate this…
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In today’s highly charged economic environment, all organisations have to make the most of all of the resources and assets at their disposal. Within corporate real estate this increasingly means adopting a portfolio approach to the management function. This paper assesses the adoption of performance management processes at this level through the review of practising leading corporate real estate teams. In documenting the measures deployed and how they are used, it identifies shortcomings and proposes an improved approach. The practical application of this is illustrated using a hypothetical case example, together with a list of potential measures.
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The paper identifies the need for a portfolio approach to the management of real estate assets, and sets out its key components as a ‘macro’ level process. Portfolio management is…
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The paper identifies the need for a portfolio approach to the management of real estate assets, and sets out its key components as a ‘macro’ level process. Portfolio management is positioned within an overall model of the corporate real estate function, from which a definition is developed. The main generic components of real estate portfolio management are described, and the most significant findings from a survey of current practices among a group of corporate organisations are presented. The paper concludes that in overall terms a more robust approach to the portfolio management of real estate assets is required to maximise the portfolio’s functional and financial value to the business.
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The Corporate Real Estate Portfolio Alliance performed extensive research into corporate real estate portfolio management and developed a number of new practices and analytical…
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The Corporate Real Estate Portfolio Alliance performed extensive research into corporate real estate portfolio management and developed a number of new practices and analytical methods. A number of papers in this issue of the Journal of Corporate Real Estate resulted from the research. This paper provides an overview of the corporate real estate organisations and researchers involved, the research methodology and its findings.
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A recent article in Strategy + Business magazine set out that the three primary goals of the CEO for creating ‘business resilience’ include (1) securing the people of the…
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A recent article in Strategy + Business magazine set out that the three primary goals of the CEO for creating ‘business resilience’ include (1) securing the people of the enterprise; (2) securing the core business of the enterprise (systems, facilities, infrastructure and processes); and (3) securing the business networks (such as the supply chain). Given these three goals, who is better suited to take on a leadership role in coordinating business continuity than the senior managers of corporate real estate (CRE) and workplace resource (WR) organisations? For several years, as the concept of Corporate Infrastructure Resource Management (CIRM) has evolved, senior CRE managers have sought out ways to create additional value for the enterprise’s core businesses. The authors believe that CRE organisations possess many of the competencies required to play significant roles in their business continuity programmes, and seizing this opportunity to fill the gaps can elevate the profile of workplace to the executive level. This paper presents a simple framework, based on five leverage points, that will enable CRE to take a more active leadership role in managing business continuity and to move to a ‘strategy and continuity’ model for managing corporate real estate.
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Planning for future real estate and facility needs in a highly uncertain competitive environment can benefit from a four‐stage process of demand forecasting. Based upon research…
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Planning for future real estate and facility needs in a highly uncertain competitive environment can benefit from a four‐stage process of demand forecasting. Based upon research conducted within the Corporate Real Estate Portfolio Alliance and a review of general business forecasting techniques, each successive stage relies on more abstract data and increased dialogue about business strategy with the lines of business as uncertainty about the future increases. Each stage requires increasing flexibility in the supply of real estate as the range of probabilities around the forecast widens.