Research in the late 1980s showed that in many corporate real estates users were not fully aware of the full extent of their property holdings. In many cases, not only was the…
Abstract
Research in the late 1980s showed that in many corporate real estates users were not fully aware of the full extent of their property holdings. In many cases, not only was the value of the holdings unknown, but there was uncertainty over the actual extent of ownership within the portfolio. This resulted in a large number of corporate occupiers reviewing their property holdings during the 1990s, initially to create a definitive asset register, but also to benefit from more efficient use of space. Good management of corporately owned property assets is of equal importance to the management of other principal resources within the company. A comprehensive asset register can be seen as the first step towards a rational property audit. For the effective, efficient and economic delivery of services, it is vital that all property holdings are utilised to the best advantage. This requires that the property provider and the property user are both fully conversant with the value of the property holding and that an asset/internal rent/charge is made accordingly. The advantages of internal rent charging are twofold. First, it requires the occupying department to ‘contribute’ an amount to the business equivalent to the open market rental value of the space that it occupies. This prevents the treating of space as a free good and, as an individual profit centre, each department will then rationalise its holdings to minimise its costs. The second advantage is from a strategic viewpoint: by charging an asset rent, the holding department can identify the performance of its real estate holdings. This can then be compared to an internal or external benchmark to help determine whether the company has adopted the most efficient tenure pattern for its properties. rents by UK‐based corporate businesses and explains internal rents as a form of transfer pricing in the context of management and responsibility accounting. The research finds that the majority of charging organisations introduced internal rents primarily to help calculate true profits at the business unit level. However, less than 10 per cent of the charging organisations introduced internal rents primarily to capture the return on assets within the business. There was also a sizeable element of the market who had no plans to introduce internal rents. Here, it appears that, despite academic and professional views that internal rents are beneficial in improving the efficient use of property, opinion at the business and operational level has not universally accepted this proposition. This paper investigates the use of internal
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Michael Evans, Nick French and Brenna O’Roarty
Discusses the role of property within corporate organisations and, in particular, discusses the impact of real estate on the balance sheet of UK‐based corporate businesses. Also…
Abstract
Discusses the role of property within corporate organisations and, in particular, discusses the impact of real estate on the balance sheet of UK‐based corporate businesses. Also explains how new and proposed provisions from the Accounting Standards Board (ASB) may affect the way in which property is held and managed in the future. Considers the proposed changes from the viewpoint of the property professional and from an accountancy perspective. Concludes that, in the future, management will be required to apply a greater focus on their property portfolio in order to meet the relevant accounting standards.
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Sustainable Development Goals (SDGs) frame the urgent call for actions by all global stakeholders to provide economic, social, and ecological prosperity (United Nations, 2021)…
Abstract
Sustainable Development Goals (SDGs) frame the urgent call for actions by all global stakeholders to provide economic, social, and ecological prosperity (United Nations, 2021). The goal is to create a better world for the greatest number of people. The stakeholders of SDGs are primarily UN member states, regardless of the size of their resources or population (United Nations, 2019). However, autonomous communities are included as well as companies. The Isle of Man (IoM) is located in the Irish Sea and is an autonomous crown dependency (cd) of the British monarchy with almost eight times fewer inhabitants than one of Europe's largest employer, Volkswagen, has employees (Brandtjen, 2019; Volkswagen AG, 2020). In 2016, the whole Isle was designated a UNESCO Biosphere Reserve (BR) and is the only entire nation to be a member of this worldwide network. The Biosphere programme focuses on sustainable development, conservation, and education within the framework of the UN's 17 SDGs (Isle of Man Government, 2021; UNESCO, 2019). But how does this programme help the IoM to develop? Did this programme help the IoM to get through the COVID-19 pandemic? Is the IoM a model for other nations to become UNESCO BRs and to create an environment for corporate SDGs to be fulfilled?
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Christopher Heywood and Monique Arkesteijn
This paper aims to report an analysis of the graphical representations of 14 corporate real estate (CRE) models. It does this to establish the systematic, metatheoretical…
Abstract
Purpose
This paper aims to report an analysis of the graphical representations of 14 corporate real estate (CRE) models. It does this to establish the systematic, metatheoretical requirements for modelling CRE alignment which to date have been disguised in a multitude of models.
Design/methodology/approach
This meta study of CRE alignment models used a qualitative hermeneutic method to inductively develop understanding of the models’ constituent parts. Several iterations of graphical and textual analysis were required to do this. Further deductive analysis sought to understand the individual models relative to this new understanding.
Findings
The analysis showed that a total of 12 components have been used to model CRE alignment. These are divided into four Building Blocks: understanding corporate strategy; understanding real estate performance; making real estate strategy; and implementing real estate strategy. While every model’s representation contained the four Building Blocks, few models contained all 12 components, though all contained at least seven. Completeness of representation in this study should not be inferred as equating to effectiveness as an alignment process. Various feedback mechanisms were also evident between the components.
Originality/value
The analysis provides the most complete map of the modelling requirements for CRE alignment. It differs from previous theoretical work on alignment by synthesising a metatheory of alignment representation. By providing a more coherent theory by which to model CRE alignment the metatheory provides a consistent basis on which to investigate and theorise aspects of CRE alignment.
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Discusses structural surveying in Europe pre‐1992 and theopportunities for UK firms to exploit the market afterwards. Outlinesthe expectations of the French client and the…
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Discusses structural surveying in Europe pre‐1992 and the opportunities for UK firms to exploit the market afterwards. Outlines the expectations of the French client and the services available, the role of UK Building Societies in promoting UK techniques in Spain and the current advantages open to UK surveyors to profit from the local systems in Portugal and Germany. Suggests that the future will see an increase in continental professionals considering acquisitions, mergers and associations with UK firms of chartered surveyors and argues that opportunities for expansion will arise through work on new construction commissioned by UK clients in Europe, rather than on existing buildings.
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Reviews ways in which sunk costs, particularly those embedded in property ownership, can affect programmes of selective closure of retail outlets. Three examples from UK retailing…
Abstract
Reviews ways in which sunk costs, particularly those embedded in property ownership, can affect programmes of selective closure of retail outlets. Three examples from UK retailing in the 1990s – Littlewoods, the British Shoe Corporation and Do it All – are used to demonstrate that sunk costs have been significant in delaying the execution of rationalisation programmes, and have led to substantial “write‐offs” of property assets in company balance sheets. Certain conventions and inflexibilities in British property law and management are identified as key influences. There is shown to be a need for further research into corporate closure programmes and their relationships with property and locational issues. Some tentative conclusions for corporate retail strategies are discussed.
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Monique Arkesteijn, Ruud Binnekamp and Hans De Jonge
One of the long-standing issues in the field of corporate real estate management is the alignment of an organisation’s real estate to its corporate strategy. To date, 14 models…
Abstract
Purpose
One of the long-standing issues in the field of corporate real estate management is the alignment of an organisation’s real estate to its corporate strategy. To date, 14 models for corporate real estate (CRE) alignment have been made, as well as four comparative studies about CRE alignment. Some of the CRE alignment models indicate that they strive for maximum or optimum added value. However, because most models take a so-called procedural rationality approach, where the focus is not on the content of the decision but on the way that the decision is made, “how a CRE manager can select an (optimum) alternative” stays a black box. The purpose of this paper is to open the black box and offer a Preference-based Accommodation Strategy (PAS) design procedure that enables CRE managers to design a real estate portfolio, makes use of scales for direct measurement of added value/preference, and allows the aggregation of individual ratings into an overall performance rating. This procedure can be used as add-on to existing alignment models.
Design/methodology/approach
The objective of this paper is to test if participants are able to successfully perform the PAS procedure in practice. The PAS procedure is in essence a design methodology that aims to solve strategic portfolio design/decision-making problems. In accordance with problem-solving methodology, mathematical models are made for two pilot studies at the Delft University of Technology. This paper describes a second test of the proposed procedure for designing a real estate strategy. The application of real estate strategy design methods in practice is very context-dependent. Applying the PAS procedure to multiple context-dependent cases yields more valuable results than just applying it to one case.
Findings
The PAS design procedure enables CRE managers to select the (optimal) solution and thereby enhances CRE decision-making. The pilot study results reveal that, by completing the steps in the PAS procedure, the participants are able to express their preferences accordingly. They designed an alternative portfolio with substantially more added value, i.e. a higher overall preference score, than their current real estate portfolio. In addition, they evaluated the design method positively.
Research limitations/implications
The positive results suggest that designing a strategy by using the PAS design procedure is a suitable approach to alignment.
Practical implications
The PAS design procedure enables CRE managers to determine the added value of a real estate strategy and quickly and iteratively design many alternatives. Moreover, the PAS design method is generic, it can be used for a wide range of real estate portfolio types.
Originality/value
The PAS procedure is original because it considers CRE alignment as a combined design and decision problem. The use of operational design and problem-solving methodologies along with an iterative procedure, instead of empirical/statistical methods and procedures, is a novel approach to CRE alignment. The PAS procedure is tested in a second pilot study to provide an assessment of the methodology through the study by testing it under different conditions to the first study. The novelty of this pilot is also that it allowed testing the procedure in its purest form, as the problem structure did not require the additional use of linear programming.
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In this paper it is argued that the degree of emotional competence demonstrated by members of a team will determine whether member interactions build cohesiveness and high…
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In this paper it is argued that the degree of emotional competence demonstrated by members of a team will determine whether member interactions build cohesiveness and high performance. The study presented examines the relationship between the average score of team members on thirteen emotional intelligence (EI) competencies, and ratings of team cohesiveness and performance in 18 teams in an Executive MBA program. Results showed EI competencies of influence, empathy, and achievement orientation were positively related to student and faculty ratings of team cohesiveness. Empathy was positively related to student and faculty ratings of team performance, and achievement orientation was positively related to student ratings of team performance. Implications are discussed.
There are two principal elements to consider in relation to the strategic management of any organisation's surplus property. The first is the process by which the property is…
Abstract
There are two principal elements to consider in relation to the strategic management of any organisation's surplus property. The first is the process by which the property is identified and declared surplus and the second is the procedure for managing such property effectively until disposal finally takes place. This paper is based on the research undertaken to consider: the key characteristics of good “strategic” management of surplus property; how other bodies (private and public) have improved their strategic management of surplus properties in the recent past; how the proposals in “Sold on Health” appear to meet good practice; and any lessons that can be learnt by the National Health Service from this work.
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Chiara Tagliaro, Yaoyi Zhou and Ying Hua
Workplace space utilization data reveals patterns of space usage, the occupants’ presence and mobility within the office building. Nowadays, emerging technology such as smart…
Abstract
Purpose
Workplace space utilization data reveals patterns of space usage, the occupants’ presence and mobility within the office building. Nowadays, emerging technology such as smart sensors and devices can revolutionize the measurement of space utilization data, which is originally dominated by human observers with paper and pencil. However, these novel instruments are often used in an old fashion, which restricts the exploitation of their full potential. This study aims to shed new light on the benefits and limits of using smart technology in measuring space utilization data and discusses the challenges and opportunities in analyzing the data measured by smart sensors.
Design/methodology/approach
First, the literature regarding common methods and previous studies about office space utilization measurement was reviewed. Then, a data set consisting of space utilization data collected through Passive Infra-Red sensors for 35 meeting rooms in a bank building was carefully evaluated. Finally, the space utilization results based on methods calculated in two different granularities were compared.
Findings
The number of occupied hours calculated at an hour level was 1.32-hour larger than that calculated at a minute level. As both results show the concept of space utilization, which was the amount of time that the space was occupied, this paper revealed a gap between the two space utilization calculation methods and further discussed the issues and challenges for future space utilization data analysis and benchmarking.
Originality/value
To the best of the authors’ knowledge, this is the first study critically addressing office space utilization issues by comparing calculation methods in different granularity.