Tenants poorly manages all cost reduction opportunities
2009-11-26
Data shows that 91% of companies are now looking for ways to save money on operating costs and expense. Given that the costs associated with the lease of premises, it is often the third or fourth largest operational cost allocation companies seek to reduce costs also in this direction. The most popular and the easiest decision: to lease premises from the owner or operator who offers the lowest price.
However, real estate specialists stresses: the now not necessarily the cheapest property rent will be most correct, the best and only option. Cost reduction opportunities are actually quite diverse, and real estate consultants, tenants should be present with them in detail.
This is a reason - to offer an adequate and professional market evaluation of the situation, as well as provide a concrete and comprehensive solutions to reduce costs, Re&Solution have organized a special conference for large tenants in Latvia entitled "Corporate Real Estate solutions in a changing market - Global trends. Best Solutions". It gave several speeches in real estate and legal experts.
"It must learn to look ahead, not thinking of today's categories. Able to consider all possible solutions, to take all the necessary calculations. This is especially important for large tenants, " says Guntars Cauna, Sales Director of Re&Solution Latvia. "There are many ways to cut the costs. Not necessarily a decision to rent, no matter what, but the cheapest room, will be correct! There are also many other opportunities. For example, studies show that 70% of the tenant space are not rationally maximized! Perhaps it is worthwhile to consider that some employees can work from home - many jobs allow it, and in the modern technological era it is no problem. Consequently, it could rent a premises with a smaller surface area and workplace number. Solutions to reduce costs can be quite diverse. "
Nowadays there is often situation when the tenant chooses to rent space at a very low price, without the true risks and benefits evaluation. For example, it is likely that the building owner has the financial issues araised, and low price is offered to attract tenants, but after some time the owner might have difficulties with the building management and than tenant should spend time, money and forces to address the problems that not connected to him thus not concentrating on his final work. Without estimations of the benefit of a longer period of time, taking into account all the aspects: building location, layout of office space, indoor climate, and various additional expenses. For example, the area outside the city center may be cheaper, but if all customers and partners located in the center, staff time and fuel consumption increases significantly. Similarly, with the indoor climate - if the premises are incorrect ventilated, low sunlight level, much dust, employees often fall sick and ldecreasing labor productivity.
Of course, not everyone is able to anticipate and consider all aspects, so the best option in this case is to turn to professional property management consultants, who will specify all the options for reducing costs, which negotiate with building owners.
The conference was not intended to once again blame publicly about how everything in real estate is bad, but to present tenants directly with real solutions and examples, as well as answer to specific questions such as what to do if the tenant remained the only one in office building, should this be taken into account when searching for new premises?
Global picture and fresh view "from the edge" was presented by a leading Northern European full-service real estate company Newsec representative Antti Tuomela, a business development manager. He talked about the best corporate real estate solutions in practice, showing specific examples of some big companies in the world of experience.
"This overview was blessed because allowed for many to look at the situation with "fresh perspective ". Many of locals are now so well aware of their possibilities. After the conference several participants acknowledged that gained a whole new vision and ideas for problem solving, which had not enlighten their minds, " pleased G. Cauna. It should be noted that Newsec Group is a partner in the Baltics, Re&Solution Latvia, a leading regional provider of integrated real estate finance and investment management areas in Latvia, Lithuania, Estonia. This autumn, and for the second year the company received the influential financial magazine Euromoney Award as the best real estate consultant in the Baltic countries.
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