Strategic Real Estate Consultancy Flashcards
What is the aim of a Strategic Real Estate Consultant?
Working with senior management to ensure that an organisation’s real estate portfolio aligns with their business strategy and objectives (both current and future).
Why is property important to a success of a business? Why is SREC important?
Property is usually the second highest business expense behind staff.
Need to identify areas of liability, opportunities and needs across a property portfolio.
The SRE consultant often works closely with wider professionals, and advising non-cognate professionals (often at senior level) such as an organisation’s board members.
What would be your starting point when analysing a businesses performance or objectives?
I would research and analyse the nature of the client’s organisation - to include:
- Market research on the company, their sector and current portolio
- Analysis of financial information (past 3’ years audited accounts)
- Organisational structure (whether they have any property services in house or outsourced)
- Understanding their entire property portfolio (Freehold vs Leasehold tenure, where is their portfolio located, asset class, values)
- Who are the key stakeholders in the business (Find out the decision makers and board approval process).
- Relevant external and internal drivers (PESTLE / SWOT analysis).
What are some analysis techniques to analyse strategic real estate data?
SWOT Analysis
PESTLE Analysis
Scoring Matrix
Cash Flow Analysis
What is CapEx and OpEx?
CapEx = Capital Expenditure in a one-off, upfront payment (e.g. purchase, refurbishment, to fit out).
OpEx = Operations Expenditure, usually paid in regular installments e.g. rent, rates, service charge
When might you be required to provide Strategic Advice to a client?
Stay vs. Go scenario
Reducing occupational cost
Requiring less or more space
Their current office is no longer fit for purpose
Revised executive or management policies (there’s been a change at board level).
Location change (Difficulty recruiting talent - amplified by the pandemic)
To comply with new / changing sustainabilty initiatives
What are the various types of business structure?
Sole trader
Private Company
Public Limited Company
Partnership
Limited Liability Partnership
What are common business objectives?
Talent acquisition / retention
Operational efficiency
Growth / rationalisation
ESG
Culture shift
What types of strategic consultant are there?
- Internal - Employed or working within the clients firm to provide strategic advice.
- External - Employed as an external consultant giving advice to implement business change.
What are the pros and cons of an internal consultant vs external?
Internal Consultant: Deeper understanding of the company culture, more influence. But can be less objective.
External Consultant: More objective, but takes time to understand the business and less integrated.
When undertaking a portfolio review evaluation, what are the key roles / responsibilities?
Benchmarking
Financial Analysis
Acquisition / Disposal strategy
Freehold vs. Leasehold analysis
What are KPIs? How do they differ from benchmarking?
KPI (Key Performance Indicator) = Measures factors critical to success of a business.
Benchmarking = Where you compare performance against others to make targeted improvements.
How would you implement benchmarking? What experience have you had with benchmarking?
- Provide method of measuring performance (KPI)
- Provide method of benchmarking against competitors
- Benchmarking allows analysis to identify areas for improvement
What are key factors to consider when implementing a relocation?
Client objectives
SWOT Analysis
PESTLE Analysis
Communter Studies
Local Amenities
Staff Consultation
In order to get to know your client, what sorts of information would you look to find out?
Organisational structure
Property portfolio (location/asset classes/values)
Analysis of financial information - review financial plans / business plans
How many people they have working for them
What sector they are working in
Their need for / reliance on technology.
