![]() ![]() On the other hand, a location that has a low price per square foot, high employee number per square foot and costs 6 percent of sales instead of 3 percent, is problematic regardless of how good other metrics might make it look. If your company is maintaining a ratio that is more efficient than its industry as a whole, paying high rents in a few locations may not be that important. Rent to Sales- The ultimate occupancy cost measure is the overall rent-to-sales ratio. Otherwise, you may mistake an inefficient location for a weak one.ĩ. ![]() To really understand the relationship of your space to your sales, you first have to adjust the space’s dimensions to reflect the proportion that is related to actual selling. However, this metric can be misleading by itself. Sales per Square Foot- Traditionally used in retail settings, sales per square foot metrics help you compare locations in terms of their ability to directly affect your bottom line. Space comparisons work across the country, letting you compare the efficiency of buildings in Lower Manhattan with counterparts in Las Vegas.Ĩ. Space/Cost per Employee- Looking at both the square footage per employee and space cost per employee gives you a better understanding of the efficiency of your corporate real estate portfolio. While it’s not useful for comparing spaces across different product types and markets, it can be a useful tool to identify an outlier among similar spaces.ħ. Cost per Square Foot- The most basic metric for looking at a corporate real estate portfolio is cost per square foot. Numbers 6-9 on our list come from Don Catalano, President and CEO of REOptimizer, a commercial real estate management software company, in a piece entitled “Key Performance Metrics for Corporate Real Estate:”Ħ. Metrics like waste and water consumption, as well as reviewing the building’s overall energy consumption, are necessary to meet with sustainability standards, manage their energy costs, and cut carbon emissions. Energy and sustainability – Real estate has a major role to play in achieving an organization’s sustainability targets. Project management – Project managers need defined metrics to effectively manage all the phases of a task from initial establishment to handover and project closure, ensuring that projects stay within scope, on schedule, and within budget.ĥ. inactive leases, and lease details to address short-term concerns and to set expectations about future requirementsĤ. Lease administration – Portfolio managers need easy visibility into metrics like upcoming critical lease events, active vs. Analyzing these metrics provide forward-looking insights.ģ. Facilities management – Helpful metrics to measure surrounding facilities repairs and maintenance include frequency of emergency repairs, repair backlogs, customer feedback, and invoicing. Employee experience – CRE teams can measure the relationship between the efficient resolution of work orders and the workplace experience of employees.Ģ. Item’s number 1-5 on our list comes from JLL:ġ. JLL, a commercial real estate services company, has put together a helpful list as part of a larger post entitled, “10 performance metrics reveal corporate real estate’s true value.”. ![]()
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