6 Ways Corporate Real Estate Leaders Can Slash Expenditures

Although companies recognize the value of real estate, those costs are often one of the largest items on the balance sheet. Corporate real estate leaders are tasked with bringing the most value to the company while also controlling costs. Here are some ways you can cut your corporate real estate expenses (and as a bonus, most will also increase your ROI on real estate!):

1. Relinquish your lease or sell a building

Lease or mortgage costs are most likely the biggest corporate real estate costs you incurr, so on paper, this is the easiest way to cut costs.

Of course, in real life, moving—to a smaller space in your current building or to a new building altogether—is not easy. Lease renewals come up and they are renewed, even if the company knows they’re only using 50-60% of the space. To break this cycle, pay attention to your lease termination dates. Your opportunity to make strong business decisions, in most cases, is about 12-18 months from that date.

Using space planning software will help you identify how your space is being used or unused. If it includes utilization functionality, like Serraview’s workspace utilization software, it will also tell you when and how your space is being used. Both can also help you make better plans and decisions faster. With the right software and data, the decision cycle can be streamlined, saving time with the relocation.

Learn about the modern workplace strategies that can revolutionize your organization.

2. Review and renegotiate your lease options

If you decide to stay put, you can still negotiate for better rates or value-adds to your current space. Again, you need to pay attention to your termination dates and start this process early. Read your lease closely to understand all the available options and make sure you have strong understanding of your needs and usage. This is also an opportunity to rethink the utilization metrics you’re tracking.

3. Audit your utilities regularly

You might be surprised to learn how long your HVAC system runs when very few people are in the office. Pay attention to your employees’ patterns and habits—which may change seasonally—and adjust your utilities systems. Depending on the size of your company and your current corporatel real estate expenses, this can translate to six-figure savings or more annually.

4. Reuse and recycle

When you’re redesigning your office layout, look for furniture vendors who purchase used or recycled desks and cubicles for repurposing. You can purchase recycled materials, especially if you need to reconfigure one floor, but are planning a bigger move in the next year.

Using recycled furniture or decreasing your utilities usage can have a bonus benefit of highlighting your sustainable practices. Both employees and clients or customers will appreciate your efforts.

Discover other ways your workspace influences your company culture.

5. Coordinate with other departments

When you cut corporate real estate expenses, be aware of how that might affect other departments. By shrinking your footprint and allowing people to work remotely, you save on your real estate costs while increasing spend in another department, such as IT. If you work together on moves and policy changes, you can find creative ways to save money.

6. Look for potential multi-use spaces

Maybe you know that overall, you’re only using 50-60% of your building, but it seems like the conference rooms are always booked and people are clamoring for more space. Can you instead use the space you have in different ways? Maybe you can make it easier for people to have meetings in the cafeteria or lobby by adding some new furniture.

Add Value by Reducing Corporate Real Estate Expenses

Cutting corporate real estate expenses no longer has to mean sacrificing a nice, well-provisioned office. Slashing expenditures instead can free up funds for offices that function better and make it easier for employees to get their work done.

With space planning technology, you can make better, more informed decisions about your corporate real estate expenses. Find out how.


Why Corporate Real Estate Leaders Must Pay Attention to Space Planning

Do you see corporate office space planning as a “necessary evil,” maybe one that takes too much of your time? Do you often get frustrated by mandates to “manage the space well” without the proper resources to deliver? Do you wish that getting groups of people to move from the third to the fourth floor wasn’t so complicated?

You’re not alone.

Many corporate real estate leaders have a love/hate relationship with corporate space planning—or at least, a begrudging like/dislike relationship with it.

But the truth is, paying attention to corporate space planning—in the right way—can make your life a lot easier. Here’s how:

  • Build a business case for change initiatives
    Strong corporate office space planning practices will help you make informed business decisions. Whether your lease is coming up and you’re considering moving to a new space, you want to shrink your footprint in your current location, or you just want to upgrade your current workstations, you’ll be able to make strong arguments for your proposals.
  • Address company changes proactively
    Instead of being caught off guard, you can plan ahead and be prepared for changes in the company structure or business goals.
  • Escape the day-to-day churn of assignments and allocations
    If you’re challenged by corporate office space planning because you’re spending too much time dealing with move requests, it’s an indication you need to step back and look at the bigger picture: Why are people looking to move around so much? Are there patterns in who’s asking to move? Most employees don’t like moving their workstations, so it’s important to understand the reasons behind the requests.

Tips for Sound Corporate Office Space Planning

1. Don’t forget the human element

Many CRE leaders, over time, forget how challenging and emotional the moving process can be for employees, even if they’re just moving to a different space on the same floor, in the same building. When you’re in “corporate office space planning mode” and looking at data points on a spreadsheet and floor plans for hours, it’s easy to forget the labels and color-coded dots represent actual people.

Don’t underestimate the communication and change management required for even the simplest moves and reallocations. It’s always better to over communicate on the timing, expectations, and deliverables and make sure you’re emphasizing the “why” behind the change. Articulate the value for the company and the employees.

Learn how Suncorp uses Serraview’s platform to strategically plan and execute large moves.

2. Make the plan fit the people

One of the great things about activity-based working is its flexibility. There’s no one “right” way to design an office; there’s just the best way to make your workplace meet your employees’ needs. For example, if you want to move to an open floor plan with neighborhoods, but most departments have at least one employee who needs access to file cabinets, those employees need dedicated spaces. The solution? Neighborhoods with “anchors” or dedicated desks surrounded by unassigned workstations.

When it comes to corporate office space planning, don’t get too attached to standard templates or common best practices. Be flexible and accommodate your organization’s and employees’ unique needs and preferences.

3. Look for underused spaces

If you’re not able to shrink your current footprint or move to a new location, look for opportunities to make better use of your office. Watch how employees work and interact with each other—are certain spots used frequently? What makes them “work” and how can you duplicate that in other areas? Are there random nooks and crannies that have potential to be meeting spaces, “phone booth” type areas, or brainstorming stations?

4. Think about boosting revenue, not just cutting costs

If you’re optimizing your current space, saving money is almost a foregone conclusion. In some cases, you may end up spending the same amount of money on real estate, but spending smarter. This means you may not see immediate bottom-line cost savings, but over time you’ll see increased revenue because your employees are more productive.

Most companies look at cost per square foot (or per square meter) or square feet/square meter per employee, but some are changing their perspective and looking at revenue per square feet/meter. Try it—and look for ways you can improve by providing better spaces to work

Of course, saving money is great too. Learn more about how corporate office space planning helps cut costs.

5. Evaluate and re-evaluate

You may have trouble with corporate office space planning if you’re trying to conform to business standards that are years, or even decades, old. Is your square-footage-per-person target based on a time when most employees used desktop computers, but now they mostly use laptops and tablets? Have you realigned business units without updating their space expectations and guidelines?

To ensure that your space planning decisions make sense, first use proper standards. And as business goals and company needs change, re-evaluate those standards regularly.

Learn more about how sound space planning can make your life easier—get in touch today for a free demo of our corporate office space planning software.