Robust commercial real estate software can be an important tool for making great decisions with your portfolio. However, its limitations are the same as any other system. The data you get out of it is only as good as the data you put into it. With that in mind, great commercial real estate decision-making requires a more holistic approach:
1. Start With a Clear Strategy
Corporate real estate strategies are driven by your company's bigger business needs. While your real estate benchmarks can help you identify which sites are productive and which aren't, that information is secondary to your company's big picture. If your Wichita warehouse is the most productive on a cost per cube basis, but your company is pulling its logistics out of the Midwest, it'll should be closed. However, a Fifth Avenue flagship store that makes no sense to maintain from a real estate perspective could be useful as a marketing tool. These are points you should keep in mind as you develop your strategy.
2. Make Decisions Early
It's hard to make your best decisions at the last second. Commercial real estate software, like REoptimizer®, enhances decision-making by helping you with critical date management. When you have your strategy and timelines prepared, it's easier to make decisions early. As a rule of thumb, you will want to start for move or renewal planning at least one year before a lease rolls. That way, you have more thanenough time to survey markets, compare sites and formulate a comprehensive strategy.
3. Use Internal Benchmarks
Another area where commercial real estate software can revolutionize decision-making is through calculating, reporting and ranking internal real estate benchmarks. If you're looking to quickly shrink too-large spaces, rank each location by the number of square feet per employee and dig in to find out which sites are underperforming. Sales per square foot rankings help you understand which retail locations are productive and which aren't, while rent-to-sales ratios help you understand which sites are good use of your money.
4. Leverage External Data
Internal benchmarking only takes you so far. It can help you figure out which of your sites are performing well and which aren't, relative to each other. This helps you make decisions about which sites to grow, which to shrink, which to keep and which to close. External data helps you answer a different question: should I stay, or should I go? Getting information on other buildings in the markets around your existing sites can help you figure out if you're paying a fair amount. Whether you use the data to move, or negotiate better terms with your landlord is your decision.
5. Utilize Expert Intelligence
Finally, it doesn’t matter how much data you have, how much you travel or well your commercial real estate software can crunch data, getting outside intelligence is an important piece to managing a corporate real estate portfolio. An experienced corporate real estate tenant representative has access to market data and local intelligence that you might not be able to tap yourself.
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