Abstract
Within the municipal boundaries, municipalities themselves are usually the largest real estate owners and managers. Such significant amount of real estate property could be expected to be professionally managed; however, the situation is different. According to the latest publications, only about 25% of major European cities are able to follow the quantity and value of their real estate portfolios. The Lithuanian Free Market Institute has recently introduced its first Index of Municipalities in Lithuania and states that none of the Lithuanian municipalities has developed its real estate management strategy. This paper reviews the scientific research on municipal real estate management and analyses the system of real estate management in Lithuanian municipalities. The authors of the paper collaborated with the Association of Local Authorities in Lithuania as well as the representatives of municipalities, and together they identified the main problems of real estate management. On the basis of real estate management research and practice within Lithuanian municipalities the authors of the paper present a brand new model which would help to manage municipal real estate effectively by taking into account the priorities of strategic economic and social development tendencies of the region.
Highlights
In many countries, municipalities are the owners, and the managers of real estate
This paper aims to overview the research on municipal RE, analyse RE management system in Lithuania and, present a newly developed RE strategic management model for municipalities
The activity of municipalities determines the efficiency of property management, use of taxpayers’ money and bureaucratic burden placed on the citizens (Lithuanian Free Market Institute and Lithuanian Real Estate Development Association 2008)
Summary
Municipalities are the owners, and the managers of real estate (hereinafter referred to as “RE”) They control a large amount of RE, including public buildings, infrastructure objects, schools, health care institutions, social housing and the surrounding land. Municipal or state institutions are often assigned functions on the basis of the owned RE, this should be the opposite case: the need for RE should be determined by the functions of the municipality/state This may be the reason why currently none of the Lithuanian municipalities has a RE management strategy defining long-term plans for managing the owned property. One of the most relevant objectives to ensure more effective RE management in the municipalities is the improvement of the quality of provided services This may be done by applying modern principles of real estate management for administrating the property of the municipality, i.e. for its purchase, lease, maintenance and renovation. This paper aims to overview the research on municipal RE, analyse RE management system in Lithuania and, present a newly developed RE strategic management model for municipalities
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