State of the Industry Report 2007-2008

Chapter Nine asset management & portfolIo optImIzatIon As with workplace, sustainability and talent, there’s a triangular relationship, or interdependency, between Portfolio Optimization, Solutions Delivery and the CRE Supply Chain. The outsourced service delivery model is its chief characteristic resulting directly from the transformation of in-house management of most all real estate functions to the outsourced delivery of globally integrated portfolios. Our research in 2007 on Corporate Real Estate Trends in Sourcing strongly points to outsourcing as the central enabler of globalization, along with technological advances on both an enterprise-wide and CRE-specific basis. In addition, it’s a driver of portfolio optimization and solutions delivery, two interconnected CoRE 2010 forces that have combined, like workplace management, to create a more strategic role for CRE departments and their outsourced partners. Click here to view Sourcing survey results and key findings. shIft to the global portfolIo The globally integrated portfolio is now one of the CRE industry’s leading driving forces defining the model foreseen by CoreNet Global. It’s also connected to the Location Strategies CoRE 2010 key value dimension, essentially turning site selection into an element of the global supply chain. Clear eVIdenCe of supply ChaIn ratIonalIzatIon: • CRE aligning with enterprise and business strategy • CRE enabling global portfolio integration • Evolution of outsourcing to support it • Move from tactical to portfolio • Increased consolidation within the service provider industry • The assumption of more risk by outsourced partners • Internal and external compensation linked, or ‘baked into,’ integrated enterprise and CRE performance metrics With these factors, there’s a resulting trend as seen in our 2007 study on Organizational Trends toward multinational corporations centralizing their CRE and workplace organizations in terms of strategy, governance and due diligence while most work is delivered regionally or locally in a more decentralized way. Regional centralization is also a factor. Click here to view Organizational Trends survey results and key findings. chapter nine here’s what Core 2010 said would happen: • Citing new models for solutions or service delivery, CoRE 2010 predicted in 2004 that “CRE departments as we know them today will not exist in 2010.” • We also said that by 2010, “companies will think not being transparent is risky.” • That’s because the 2010 forecast on portfolio optimization stressed “complete visibility on every aspect of ‘space,’ partially as a result of the sarbanes-oxley act, as well as to ensure that the space meets the needs of the business.” • More importantly, this would be done on two levels: asset and portfolio. • Another 2010 expectation is based on the idea of new “value networks” in which “portfolio optimization will extend down the full vertical length of the supply chain.” • The value chain would extend across business partnerships, suppliers and to customers, blurring the “distinction between CRE and the real estate of the networked business partners.” State of the Industry 2007-2008 38 http://www2.corenetglobal.org/home/index.vsp http://www2.corenetglobal.org/dotCMS/kcoAsset?assetInode=1070582 http://www2.corenetglobal.org/dotCMS/kcoAsset?assetInode=2500126 http://www2.corenetglobal.org/dotCMS/kcoSearch?search_type=advanced_search&keyword=keywords&search_field=sarbanes-oxley&kwPublicationMonth=-1&kwPublicationYear=-1

Table of Contents Feed for the Digital Edition of State of the Industry Report 2007-2008

State of the Industry Report 2007-2008 Contents Chapter 1: Introduction : CoRE 2010 Framework and Report Structure Chapter 2: The Changing Business Environment Chapter 3: Executive Summary of Key Findings and Conclusions Chapter 4: CoRE 2010 Adoption Rate Chapter 5: Sustainability/Corporate Social Responsibility Chapter 6: Global Sustainability Survey and Roundtable Findings Chapter 7: Workplace Practices/Work Environments Chapter 8: Workplace Related Issue: The War for Talent Chapter 9: Asset Management/Portfolio Optimization Chapter 10: Solutions Delivery Chapter 11: Location Strategies/The Strategic Role of Place Chapter 12: Location Related Issue: Site Selection Morphs to Portfolio Alignment Chapter 13: Strategic Competencies/Enterprise Leadership Skills Chapter 14: Competencies Related Issue: The War for Talent in Corporate Real Estate (CRE) Chapter 15: Integrated Resources Infrastructure Solutions – IRIS Chapter 16: Technology and the Web Chapter 17: Technology Related Issue: Removing the Obstacles to Industry Data Standards Acknowledgements and Sources

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