How corporate real estate affects cities, work and life
Corporate real estate (CRE) is often classified under the broader commercial real estate category and refers to the management of a company’s real estate assets – offices, warehouses, manufacturing facilities, data centers and other elements of the built environment.
CRE is a profession, a set of skills and a knowledge base that is simultaneously distinct and strongly intertwined with more familiar corporate functions such as human resources and finance. While the roles within CRE range from the mundane (property tax strategy, sale leasebacks) to the sexy (gleaming new downtown corporate headquarters, jobs!), the profession has an immeasurable impact on where and how people work. And that has a corresponding impact on the overall picture of how cities are designed and should be designed.
From cubes to open floor plans
Perhaps more interestingly, over the years those involved in the CRE practice have extrapolated these ideas remarkably accurately to other fields of business and general life experiences, steadfastly identifying future trends for the profession. Workplaces have been transformed from cell farms to open environments where people share natural light and access to each other. Those who were once considered “environmentalists” are now practicing a common goal of sustainability.
The pandemic is just the latest example.
Well before the March 2020 closure, CRE experts had envisioned the need to build workspaces that can accommodate workers who may only be in the office once a week or month.
Consider this summary finding from a landmark CoreNet Global log in May 2012:
“CRE will provide a range of services and capabilities, from small group meeting spaces and private spaces to virtual meeting technology, to get work done, wherever it happens. Finally, either locally or within the community, CRE will create the “third place” recreational jobs – those much-needed alternatives to informal work and social connections that are so critical to forging relationships and building strong networks of talent.”
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From this insight, CRE professionals were able to envision concepts that are commonplace today – coworking, remote work, hot desks, unassigned workspaces, and “hoteling” in the office.
Going back even further, you can look at the 9/11 attacks and see the way CRE professionals responded – using the nascent internet to connect companies with excess office space with those that suddenly had a needed space for their employees – as a reason for the possibilities of coworking.
And something else was born in the wake of this horrible time, CoreNet Global, the only professional association dedicated to the practice of corporate real estate worldwide. This year marks the 20th anniversary of CoreNet Global.
While the work of CRE professionals had steadily gained prominence and visibility prior to the pandemic, the closure has brought greater prominence to this critical corporate function.
How would offices need to be redesigned to allow people to return to work safely? Could entire workforces become completely remote, and if so, what will happen to corporate headquarters itself? How has the field become more diverse and inclusive, and what does it need to do to become even more diverse?
Next comes the metaverse
While CRE professionals have been closely watched throughout the pandemic, CoreNet Global’s early findings seem to hold true once again: people will return to the office, but maybe not every day and certainly not 9-5; Office buildings continue to play an important role, although a company’s overall real estate portfolio may shrink, working from home and technology-enabled ‘third parties’ will continue to be crucial.
And now the industry is looking ahead again – in the direction of the Metaversum.
It might sound as strange today as the idea of open floor plans did 20 years ago, but there’s little doubt that over time the Metaverse will become a more familiar and accepted concept. Want to learn more about it and sound smart to your friends? Follow the lead of CRE professionals.
This week, real estate professionals worldwide celebrate Corporate Real Estate Week. This annual celebration of the long-term growth of corporate real estate also recognizes CRE’s contribution to corporate governance strategy as well as day-to-day life.