Being a director of corporate real estate is a challenging position. Tasked with managing one of a company's biggest expense lines, CRE directors have to do it in many cases from great distances. They also have to keep track of an amazing number of dates and other small details, and making a mistake on a large lease could end up costing thousands or even millions of dollars. Here are a few ways that corporate real estate professionals can use technology to save time, reduce the risk of errors and even reduce some of the costs of their companies' real estate portfolios.
Stop Referring to Leases
CRE directors need to be on top of every detail for every site all of the time, and flipping through leases is an inefficient way to do this. Most companies have completely different lease forms for each location, based on having different landlords operating under different sets of state laws. Furthermore, while some leases have their information in the body, others place it in an appendix, and others have been completely changed over the years through renewal addenda.
At a minimum, corporate real estate professionals should take the time to generate a one to two page abstract of all of their leases. They can then refer to the abstract when they need information from the lease and simply update it when their lease gets renegotiated at a rollover or other juncture.
The next step is to take that data and enter it into a corporate real estate software package that can use it as the basis of a reporting system. The software simplifies every lease administration task while also making it faster to analyze your portfolio. (Note: If creating lease abstracts for your portfolio is a daunting task in and of itself, consider a system that will create abstracts for you.)
Analyze Company-Wide Real Estate Occupancy Expenses
As a cost center, most corporate real estate departments know that they really have only one way to directly impact their company's bottom line -- by reducing costs. The best way to reduce costs is to start by doing a quick comparative analysis of occupancy and operating expenses on a by-site basis. When the most expensive sites are identified, the department can focus efforts on improving those site's operations, ensuring that they get the greatest financial return on the time and effort that they expend. This process can also be greatly simplified through the use of a occupancy cost analysis software package.
Prepare for Rollovers
Rollovers can be a frustrating and time-consuming process, but staying ahead of the game makes everything much easier for corporate real estate professionals. The occupancy expense analysis will help identify if a site should stay open or not. If not, there may be no need to look at the market for a replacement space or to contact the landlord for a renegotiated lease (although we always advocate maintaining strong market intelligence in every market your in to make sure you are at or below market rates). If the site is worthy of renewal, doing a market analysis from the home or office can help to focus the renewal process on working with the existing landlord or planning a move as well as potentially reducing the number of days that need to be spent on the ground touring sites. As with the other tasks, while rollover planning can be done manually, a good corporate real estate software solution can also help to automate the process and make it less time consuming.
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