Measuring the Added Value of Corporate Real Estate Management - Beyond Cost Minimization

Abstract

Corporate real estate management (CREM) performance needs to be measured and monitored so as to ensure the match between a company's business and real estate strategies. Performance measures used in CREM should be identified based on the company's core business goals instead of using traditional accounting measures focusing mainly on cost reductions or capital minimisation. The aim of the paper is to combine multidisciplinary approach and empirical research results to develop a balanced set of key performance indicators to evaluate how corporate real estate directly and indirectly adds value to the company's bottom line financial results. The empirical results are based on interviews with corporate real estate executives and service providers as well as corporate senior managers. Based on the model we have developed in our previous research, and the results from our two waves of interviews, we prepare a proposed set of key performance indicators tied to real estate strategies and operation decisions presented in our framework.