If your company leases a large number of office spaces across multiple geographic areas, it's easy to become caught up in dealing with lease renewals and cost analysis for your individual locations. Unfortunately, this can lead to inefficiencies and wasted money. Taking a step back and considering your entire CRE portfolio can uncover opportunities for improvement. Here are six ways that you can begin optimizing your portfolio:
1. Conduct a Utilization Audit
Take the time to assess how much floor space is being used in each of your offices. If you find that you have many underutilized offices, you may want to consolidate locations to reduce your total number of offices or sublet parts of your office spaces. You may also be able to redistribute departments and teams to reduce crowding in one or more offices.
2. Rethink Locations
For each office, rank how important location is to your daily operations. You may want to relocate offices that score lower to less expensive areas of the country. Use market research to determine if your costs are in line with trends in each area. Software programs can even allow you to compare your current expenses to those in new geographic areas, so you can evaluate how advantageous a move would be.
3. Invest in New Technologies
Technology can make it possible for you to shrink the size of your physical footprint. Today, many employees prefer to work partially or completely at home. With the right infrastructure, you can make the switch to half-time or full-time teleworking to reduce the size of your offices or eliminate some locations completely. New technologies can also make it possible to locate large data centers in more remote areas where rent rates are less costly.
4. Analyze and Renegotiate Costly Spaces
Rank all of the offices in your portfolio by cost. Then, delve into the numbers for the top 10 percent of locations on your list. You may find that there are ways you can reduce operating costs by changing business practices or following the previous tips. Otherwise, head back to the table with landlords to renegotiate your lease terms. Often, landlords will be willing to work with you if your company will extend the length of your leases.
5. Align Your Portfolio and Your Future Goals
Your company's strategic goals have likely changed over the years, and older offices in your portfolio may no longer match your vision for your company's future. Involve your entire management team in the optimization process. Receiving input from a diverse range of perspectives can help to ensure that your portfolio doesn't just delight your accountants but also benefits operations, human resources and marketing.
6. Think Green
Greening your portfolio through retrofitting, in-office waste initiatives and offices in newly constructed, eco-friendly buildings provide many benefits for your company. Eco-friendly practices can reduce utility costs and help you achieve sustainability goals. Plus, your company's greener offices can become a selling point for prospective customers and a differentiator for existing clients.
Here are a few other articles we think you'll enjoy:
The Importance of An Office Layout
Ways to Know It Might Be Time for New Office Space
8 Things to Be Aware of in Your Commercial Leases
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