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IAMC INSIDER
From Site Selection magazine, July 2016
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A Source for Optimism

Samantha Turner
Samantha Turner
IAMC Chair

In the years I’ve been in corporate real estate (CRE), I’ve seen significant gains in the use of digital technologies. But I can also tell you many in the field have not been enthusiastic about this. Real estate is largely viewed as a person-to-person business with a sense that technology sometimes adds little value. On the other hand, today every corporate function is squeezed for resources, CRE not the least. With that reality, it is imperative that CRE managers leverage resources and utilize better management and labor-saving technologies available in the marketplace. Today, I’d like to talk to you about the latter, CRE tech.

Offering some support for my observations on corporate real estate, David Mandell writes in REjournals.com about CRE’s first cousin commercial real estate, saying that while it “is an industry driven by out-of-the-box thinkers, it remains behind the technology curve.” To catch up, Mandell prescribes development of mobile apps, selected use of social networking, exploring big data and migrating tech applications to cloud computing. All of these should be viewed as opportunities for CRE to more effectively manage its business.

It seems to me that potentially applicable technologies are piling up at CRE’s doorstep. For example, aerial drones are already revolutionizing small-area geographic surveys, marketing of assets, and site assessments. (This topic was explored in Site Selection’s July 2015 cover story.) Further, “augmented reality and gamification help tenants by changing the remote property tour experience. Using virtual reality, drone video and other tools create more user-driven, realistic experiences,” says John Gates in the National Real Estate Investor. Further, it saves significant time and more effectively manages travel.

Consider also the Internet of Things (IoT), which enables machine-to-machine interaction, potentially eliminating the need for a facilities employee to be on site to read a dial and then make a physical adjustment. The Service Channel publication “7 Trends that Will Impact Facilities Management” says, “And as connected (to the Internet) devices, equipment will be able, in a sense, to submit their own work requests and get serviced — before problems occur and negatively impact the all-important customer experience.”

Here’s another major opportunity in my opinion: CRE needs to find its dark data; make it available for analysis; and open it to the rest of the company, as appropriate. Dark data consists, for example, of those really cool numbers we keep in Excel spreadsheets. Useful information is stuck there. About this, Gates writes, “a CRE department must be data-driven and use advanced data and analytics platforms that marry data governance, data management and business intelligence with technology and knowledge management.” Getting CRE’s buried data into play could be a gold mine for the department and beneficial to the broader company, as well.

Technology is a source for optimism that more and better CRE work can be done with existing resources. But to realize the savings, efficiencies and breakthroughs, you and I — all of us — need to get in the game, try out emerging technologies and put the promising ones to work.

Samantha Turner
IAMC Chair

Designing Corporate Real Estate Systems

IAMC Active Members discuss a program point.

Editor’s Note: This article is based on a March 13, 2016, IAMC New Orleans Professional Forum Food Processing Industry Group program. Russell Burton of PepsiCo moderated the session, which featured panelists Jennifer Roth of Bimbo Bakeries USA, Karen Shchuka of Penske Truck Leasing Co. and Bill Pickens of PepsiCo. The Economic Development Partnership of North Carolina sponsored the program.

Overview

To increase productivity and reduce costs, corporate real estate teams often adopt outsourcing arrangements and technologies. Third parties are commonly used for transactions, project management, construction, legal, and site selection in new markets. Software solutions are also an integral part of corporate real estate operations, whether for automating rent payments, storing and sharing documents, or project management. Some believe greater access to information through new technology will change the nature of broker-tenant relationships and eliminate commission-based compensation models.

Key Takeaways

Many companies use automated processes to handle monthly lease and variable payments.

  • One company uses a system whereby monthly payments are uploaded from an Access database to the company’s AS400. Accounting processes the payments and sends an exception report which flags payments that were different from the prior month.
  • At another company, rent streams are fed automatically via FTP from their service provider’s database into Oracle. A variance report indicates what has changed on a monthly basis. Rent is paid once a month. Payments for variables and tax bills are made weekly.

“When you purchase software, it’s like buying a car. You need to understand your requirements before you go shopping for the right product.”
— IAMC Food Processing Industry Group program participant

Creative approaches can pay off when dealing with final asset and idle-space disposition.

Many corporate real estate departments find that the standard brokers who handle tenant rep don’t do a good job on final asset dispositions. Some simply post idle assets on CoStar and hope they get a phone call. One CRE department has had some luck putting their own listings on LoopNet, which is like a Craigslist for real estate. Program attendee Christopher Chung from the Economic Development Partnership of North Carolina noted that local economic developers can help identify potential uses for idle space. Developers are an excellent resource, especially in small markets, since they call on the most likely candidates for overflow space.

Corporate real estate teams are exploring new software solutions.

The group shared information about their experiences with different technologies.

  • Leverage knowledge from other parts of the company when selecting and implementing software. When one corporate real estate team wanted to replace its Access database with a more robust solution, it turned to the company’s sourcing and quality teams for help. The sourcing department assisted with the RFP process. The quality department helped create process maps of all the corporate real estate processes. These were included in the RFP as requirements for vendors. The team is now implementing Tririga.
  • Use new systems as a springboard for other changes. One CRE found that organizations are more open to change when a new system is being implemented. She is using the Trirega project as a springboard for outsourcing abstracting and creating a five-year plan for the real estate portfolio.
  • Utilize IAMC’s research on software packages. The IAMC Education and Research Committee created a document that summarizes the functionality of many different CRE software solutions. Joel Parker, the staff liaison, can provide members with this resource.
  • Consider Microsoft SharePoint for project management and document sharing. Several organizations are using SharePoint. The product is very flexible and can be branded for internal use. One major benefit is that access can be controlled to the group and personal level. It is also possible to provide external access to certain folders. The group described different ways they are using SharePoint, including to share meeting details, images from properties and as a content repository for a global project.




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