State of the Industry Report 2007-2008

Chapter Nine • Still, the idea of a “Big 4” of CRE global service providers was expressed in 2007 • See Chapter 10 for an in-depth look at service provider consolidation As for the prediction that the lines demarcating space occupied by global companies will become more blurred, the trend is probably ahead of the expected 2010 outcome: • Corporations have begun to share major portions of their portfolio with their extended networks of partners and suppliers. • Another factor: High levels of cross-investment globally and globalization of the reIt industry prevailing today and that will continue as the new ownership model of the industry matures. the fleXIble portfolIo • One reflection of this is a changing lease-to-own ratio by corporations. In 2007, our data show companies leased 48% of their space. They expect to lease 54% by 2012. • Taking the $1.2-trillion in real estate managed by CoreNet Global members, the projected 6% increase in leasing is a tidal shift. • New, more agile structures are also becoming more commonplace. In 2007, we predicted a surge of multi-property sale-leasebacks. • It signifies a stronger linkage to the capital markets and the use of flexible strategies to create more value by freeing up cash. • Augmenting the trend are new practices such as real options, which add flexibility to the structure and terms of corporate leases, our 2007 research has also shown. • Service delivery rfp gap: corporate occupiers perceive the time and cost needed to respond to RFP’s are much lower than they really are. Another issue is the absence of standardized RFP’s. related InformatIon on portfolIo & sale-leasebaCks Click here to view Trends in Sale Leasebacks 2007 survey results. Click here to view Trends in RFPs survey results Click here to view LEADER Magazine, November – December 2006: Rockwell Automation’s SaleLeaseback Strategy. what will it look like in 2010? The overall objective for companies to attain higher levels of performance from CRE assets will be realized in a larger but not complete measure, starting with the macro-economic reality that globalization will continue for at least another 20 years. • The real estate supply chain will improve with global economic growth. • third-party ownership will grow to even higher levels. • This will include even more socially responsible investment funds versus the growing number seen today. • life cycle asset management will become integral to this trend, driven by the 3BL. • Resulting higher levels of value and lower costs of occupancy add another dimension to the portfolio optimization formula. beyond 2010 • The lack of supply-chain readiness associated with formerly immature markets is far less patchy with ongoing global expansion. • The ideal of a globally outsourced single service provider is more likely to happen. • But the need for even larger-scale delivery networks is as likely if the economies of the world continue to advance to free market status. chapter nine State of the Industry 2007-2008 40 http://www2.corenetglobal.org/home/index.vsp http://www2.corenetglobal.org/dotCMS/kcoAsset?assetInode=950247 http://www2.corenetglobal.org/dotCMS/kcoAsset?assetInode=1070551 http://www2.corenetglobal.org/dotCMS/kcoAsset?assetInode=954208

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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