Session # 2
Real Estate

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Manage & implement Real Estate Master Planning
Process
Manage Real Estate Assets

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Traditional perception of facility as office/workspace
More valued today as property to be sold or traded
New organizational function-managing Real Estate as an asset
Requires developing new skills while utilizing old ones
Need to understand Real Estate Principles & Practices
Need to see inter-relationships with Facility Management

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Real Estate Planning
 Tools & Techniques
The Real Estate Life Cycle
 Key Activities
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Tools
FM Touch Points
Adding FM value to Real Estate Function

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Managing the Master Plan
Own vs. Lease
Types of leases
Negotiating a lease
Disposal of facilities

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 Corporate strategic plan
 Anticipated growth
 Anticipated compression
Financial analysis
Corporate Business Cycles
Corporate image

Influences- External Factors
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Financial market/macroeconomics
Real Estate market conditions
Environmental regulations
Governmental controls
Community Relations

Managing the Real Estate Master Plan
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Vision
 Strategic in nature
 Holistic
Components
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Follow strategic plan format
Confidential document
Key Stakeholders
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Internal
External

Maintaining the Master Real Estate Plan
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Measure Real Estate performance
Measure customer usage
Monitor economic changes in market
Awareness of deviations from plan
Information gathering for recommendations

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Acquisition
Extended Operating Hours
Management
Disposition

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Due Diligence
 Appraisal
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Environmental
Condition Assessments
Operating Cost budgets/Pro Forma
Sustainability
Lease vs. Purchase
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Time value of money
Lease types
Fee Simple
Terms, conditions & Clauses

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 Assemble a team
 FM as owner rep
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Legal
Broker
Develop RFP
Standard Levels of Service
Supply/Demand of Market
Landlord Incentives

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Highest & Best Use Studies
 Optimum use of facility
Calculations
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Space (SF, Gross, Rentable, Usable)
Cost (opex)
Portfolio Administration
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Inventory
ROI
Performance
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Analysis
Reporting

 In a multi-floor, multi-tenant office building, a private stairwell built between two floors occupied by one tenant is:
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Part of the building’s common area
Part of the tenant’s rentable area
Part of the tenant’s usable area
Part of the floor’s common area

 Usable area equals rentable area minus which of the following (Choose 3)
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Building Core
Primary Circulation
Secondary Circulation
Service Areas

 An attribute of a good master plan includes (choose 2)
 Accurate
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Permanent
Detailed
Within the framework of a corporate master plan

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When calculating a floor’s rentable area, you must first subtract the area calculations for which of the following
(choose 3)?
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Stairwells
Restrooms
Elevator shafts
Mechanical chases

 To be legally enforceable, a contract to purchase real estate must include all of the following, except:
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Be in writing
Include consideration
Include insurance requirements
Include signatures

 Leasing provides which of the following advantages
(choose 2) ?
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Allows for minimum capital investment
Allows a business to enter a market quickly
Provides a hedge against inflation
Conveys company pride & growth

 In Real Estate, curb appeal means:
 Height of the curb and distance to the parking lot
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Initial impression a facility makes on a visitor
Layout of the landscaping & shrubbery
Large natural areas preserved for environmental reasons

 Purchasing property provides which of the following advantages (choose 2) ?
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Ensures a business the desired location
No restrictions on use
Conveys financial stability
Good exit strategy if company downsizes