Doing a gap analysis that aims to improve your corporate real estate strategy is an excellent way to ensure that expenditures are not wasted. A gap analysis is a three-part strategy. First, measure each space’s impact on profitability. Second, measure how each space is utilized. Finally, focus on cost metrics that help identify where savings can be made.

Survey Space Impacts

The first step in identifying gaps and issues in corporate real estate strategy is to measure the impact that each space is having on your company's overall branding, operations and profitability. A good space is one that is well kept, productive and efficient. Here are some examples of spaces that could be causing a gap in your overall portfolio:

• Look for warehouses serving dwindling markets that could easily be served from a different facility. These warehouses require your company to split shipments and unnecessarily add complexity to the supply chain. Get more tips for warehouse distribution strategies.

• Look for retail locations whose branding targets a market that is dissimilar to the area’s demographics. Get more tips on retail site selection.

• Look for offices that are located in markets with limited and high-cost air service when a smaller satellite would be more suitable. Get more tips on office site selection.

• Look for facilities that don’t meet your company's standards for quality or appearance, or facilities that have unsuitable co-tenants. Both issues potentially dilute employee retention and corporate culture. Get more tips on property management.

Through your analysis, you should be able to identify which locations are harmful to your company’s long-term success and/or misuse resources. Since these locations can potentially damage operations, the best corporate real estate strategy is to immediately cut ties from them. Either allow the leases to expire or attempt to recover some of the cost through an aggressive subleasing campaign.

Survey Utilization

Once you've identified the gaps that are actively harming your business, the next step is to find sites that are largely wasted. The best way to do this is to use commercial real estate software to run reports that rank individual property types by utilization.

Learn more about REoptimizer® and tools like utilization ranking and benchmarking.

Retail sites with lower sales per square foot, offices with high employees per square foot and warehouses with utilization ratios that are too low warrant an investigation.The best strategy for these problem sites could be to consolidate them. If you don't have a way to increase utilization at a specific location, try working with the landlord to shrink the space you occupy and reduce occupancy costs to bring them back in line with the rest of your portfolio.

Survey Cost

Once you've trimmed unnecessary square footage from your portfolio, the final step in a corporate real estate strategy gap analysis is to look at the costs for your now-optimized spaces. Compare cost-per-square-foot metrics to similar sites that you occupy and similar sites in the market. While this last step in your corporate real estate strategy may have less impact than closing or shrinking spaces, every dollar of savings goes directly to your bottom line.

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