Companies emerging from the global economic crisis are focusing on restructuring and productive use of corporate real estate.
The finding was highlighted in the inaugural Global Real Estate Survey by Jones Lang LaSalle and Thomson Reuters, which compiled responses from 500 CRE executives in China, India, Australia, UK, France, Germany and North America. The cross-section included banking and finance, pharmaceutical, government and IT industries.
“This survey gives us an unprecedented window into the mind of the CRE community as well as the global business marketplace as a whole,” said Stuart Hicks, Jones Lang LaSalle’s CEO. CRE typically accounts for seven to 12 percent of a corporation’s total operating costs.
Of the respondents, 97 percent supported one or more “tactical real estate plays” to reduce costs. Thirty-five percent said growth would be the most influential factor in shaping real estate strategies in the next three years followed by 11 percent citing cost pressures as carrying the most weight,.
“Many will need to progress their journey along the outsourcing curve and partner with specialist real estate service providers in o9rder to effectively meet these challenges,” Hicks added.
Topping the critical needs list going forward will be attracting talent, enhanced productivity, right-sizing the portfolio and the desire to change the culture and nature of work. And with that comes the need to create more efficient workspace.
Thirty-nine of the respondents expect an increase in the size of their global portfolio in the next three years while 31 percent are calling for a reduction. Respondents suggested the U.S. and Western Europe will experience a reduction in portfolio sizes in the next three years unlike the strong-growth regions of Asia-Pacific.
In terms of industries, financial seems to hold the lead globally. Although most corporations are emerging with stronger cash positions, economic uncertainty remains a concern by 29 percent of the respondents. The majority of respondents firmly believe that structural changes are underway for CRE functions.
“There is a clear opportunity for CRE leaders to redefine their organizations and drive a more strategic real estate agenda as the importance of this role continues to broaden in board rooms across the globe,” Hicks said. The survey’s take-away is 80 percent disclosed plans to fully or partially outsource CRE functions within the next three years.
Source:http://newyorkrealestate.citybizlist.com/18/2011/3/7/Outsourcing-Gains-Strength-as-Companies-Redefine-CRE.aspx
