It goes without saying that the commercial real estate industry has been – and will continue to be – hard hit by the economy.
With real estate expenditures typically representing the largest G&A (general and administrative) expense after payroll, effective management of leased/owned portfolios is more important than ever. Since the lease administration department is the command and control center of these portfolio costs, we thought it would be useful for our clients and industry colleagues to find out if these lease administration departments are adapting to these dynamic market conditions.
Updating our 2006 benchmarking survey, Deloitte Financial Advisory Services LLP surveyed executives at companies involved in lease administration (including companies that lease commercial space) – assessing how companies were approaching lease administration issues with concentration on organizational structure, outsourcing, technology, human resources, lease abstraction and lease audits.
The 2010 Lease Administration Benchmarking Survey confirmed that a majority of lease administrators are focused on reducing expenses in a number of different ways. They are also looking to capture accurate and timely data on their leases. Leveraging advances in technology, many companies (three-quarters) are seeking to improve management and reduce costs by using a centralized organization structure for lease administration, up from two-thirds in the 2006 survey.
I’d be curious to hear what you are seeing in the marketplace? What are you doing differently?