IDRC Abstracts

“What every corporate real estate department needs to realize in this economic downturn is that every asset has a value. Every asset can be sold or sub-leased,” said Craig Morris, president of the Corporate Services Group of Grubb & Ellis.

       
In the new reality of the slower economy, CRE officers must find new and innovative ways to dispose of assets on their books when those assets prove non-productive or non-essential to the bottom line. Morris, who moderated a panel discussion during the Texas World Congress in Dallas, said that in tough economic times, incentives to local brokers work. “We’ve had some success on giving the extra point,” he said, “and in times like this, it gets the locals’ attention.”

       
Knowing the bottom line is the key to selling assets, said Chuck Dobbins Jr., director of corporate assets for Shaw Industries, a carpet manufacturer in North Georgia. “I am continually amazed in the corporate arena that folks don’t have an accurate account of what their assets are costing them,” he said.

       
Offering an example, Dobbins said that Shaw went from 400 retail outlets to none over a 24-month period. He said that the key to effective asset management is to have an exit strategy in mind at the beginning of every lease and sale. “Know your portfolio,” he said. “Think about what you can reasonably recover.”

       
Can the World Wide Web reduce costs and improve performance of corporate real estate operations? It can, as long as the Internet is used properly, said a panel of industry experts at the Texas World Congress in Dallas.

       
Scott Hemphill of the General Motors Worldwide Facilities Group said that GM had successfully used the Web to deliver improved customer service, reduce staffing levels and provide better reporting of results. “The GM Facilities Help Desk is a Web portal for customer service for all GM property occupants,” he said. “And we are now extending this service from non-manufacturing sites to our manufacturing locations.”

       
Mike Gunter, vice president of the Customer Solutions Group for FacilityPro in Atlanta, said that his company offers an e-procurement platform that offers a single consolidated place for purchasing. “We can reduce product costs for our clients by leveraging economies of scale of the portfolio through strategic outsourcing,” he said. “A prime example is Equity Office. They have 616 buildings, 124 million square feet (11.5 million square meters) of space, 1,800 suppliers and more than 7,500 invoices per month. Our solution involves the implementation of a private procurement marketplace and spot-sourcing program, as well as strategically sourced maintenance, repair and operations.”

       
Norman Thurow of Johnson Controls said that “the Web itself does not provide a lot of value except that it is ubiquitous. We use the Web as an enabler in every office and project we work on around the world.”