Keeping your company’s real estate strategy on track is a complex task, which requires expertise, time, and attention. Decisions you make regarding your real estate portfolio today can have long-term consequences for your company’s operations and finances. In the list below, we share six tips that can help in-house real estate execs be more successful in managing their corporate real estate needs.
Follow the Big Picture
Your real estate plans should follow your corporate business strategy, not the other way around. For example, many companies were forced to transition to 100% remote work due to the pandemic, which left their corporate offices empty. However, if this new arrangement is working out, executives should focus on disposing of the unused space rather than forcing employees to come back to the office just because “we are paying rent”.
Allow Ample Time
While no business decision should be made in a rush, this is especially true when dealing with real estate. Commercial lease terms can be quite lengthy so each potential location should be evaluated carefully before signing a lease. As a general guideline, you should allow at least a year for due diligence and negotiations when looking to relocate to a new property or to open a brand new location. Even renewals need to be initiated at least several months in advance in order to allow enough time for a plan B solution should the deal fall through for any reason.
Study the Market
The commercial real estate market tends to fluctuate with economic cycles. Therefore, it is important to thoroughly research the state of the market every time your organization is looking to lease, relocate, or renew. Thankfully, there are a number of great market data sources available today. Keeping an eye on vacancy and absorption rates, rental rates, new construction, and new tenants entering the market should help you prepare for your next real estate move.
Use Company Benchmark Data
A lot of useful information for your real estate strategy can be gathered by reviewing your company’s internal data. As a matter of fact, internal numbers are the best source for identifying underperforming or surplus locations. For example, retail relies heavily on sales numbers to determine which stores are most profitable. The same logic can also be applied to office and warehouse properties. While it may be more difficult, analyzing the productivity generated at each location can help you decide whether to expand or close certain locations.
Leverage the Power of Technology
Commercial real estate technology has made leaps and bounds over the last decade. Today there are a number of websites and tech solutions targeted exclusively at the corporate commercial real estate user. For example, sites like CoStar and LoopNet can deliver a wealth of market intelligence. Furthermore, there are a number of SaaS products and apps that can help with real estate portfolio analysis, optimization, and management.
Hire a Tenant Rep Broker
If handling all of the above on your own sounds daunting, you are not alone. The good news is you can enlist the help of an expert commercial real estate professional at no cost to you. Tenant rep brokers can assist with optimizing and executing your corporate real estate strategy, whether you are looking to expand, relocate, or dispose of space.
With decades of experience in the corporate real estate world, our tenant representatives are readily available to steer your real estate strategy in the right direction. Contact us today to discuss your goals and how we can help you achieve them.