Most companies with sizable real estate portfolios have been obtaining facilities management, project management, and transaction management services for years from a variety of service providers across the real estate, construction and maintenance industries. In many cases, however, these companies simply “out-tasked” individual functions and facilities on a piecemeal basis without a clear sourcing strategy, and now find themselves with multiple overlapping internal and external relationships, flat or increasing costs, little integration or consistency across functions and facilities, and limited access to meaningful performance data.

The real estate outsourcing market has matured significantly in recent years. Service providers are now able to address these problems with cross-functional staffing, integrated IT systems, standardized delivery processes, networks of subject matter experts, and sourcing capabilities that leverage billions of dollars in purchasing power. As a result, many companies are considering outsourcing real estate services for the first time or restructuring existing outsourcing relationships as a means to transform their real estate operations, generate cost savings and take advantage of new options in the marketplace. Across multiple industries, we have found companies that take advance of these new options realize significant near-term and long-term operational savings at the same or better performance level.

 

NEW MINDSET

As more innovative collaboration occurs between Global 1000 clients and service providers across a wide range of business functions, it's clear that there is a paradigm shift unfolding in how global companies are utilizing external resources to improve overall performance. Business functions like human resources, finance and accounting, and procurement lead the way in changing how the game will be played in non-core business functions.

Much like corporate real estate, these business functions have limited access to capital for investments, and the mandate to do more with less is becoming even more prevalent. The best of the best are beginning to understand that the successes that are being generated by their internal peers in human sources and other disciplines are a blueprint for how corporate real estate will be measured and rewarded in the future.