Arizona Republic: "Tenants re-examine facilities costs"

Arizona Republic: "Tenants re-examine facilities costs"

Corenet Global in the News
September 21, 2010

ARIZONA BUSINESS & MONEY

Tenants re-examine facilities costs

by J. Craig Anderson - Sept. 21, 2010 04:40 PM
The Arizona Republic

Unlike most real estate conferences, which focus on the needs of buyers and sellers, the CoreNet Global Summit in Phoenix this week examined the recession's effect on commercial properties from the inside out.

CoreNet Global is a non-profit trade organization focused on issues related to what it calls "corporate real estate."

Its constituents include corporate facilities managers, economic development officials, architects, leasing agents, building contractors, efficiency experts and anyone whose job involves making the most productive and cost-effective use of manmade space.

John Pierson, one of CoreNet Global's Phoenix chapter board members, said nearly every large company has reduced staff over the past few years.

Although it has not been as well publicized as layoffs, Pierson said most corporations also have re-examined their next-biggest expense after employees: Facilities costs.

"Everybody's focused on efficiency," said Pierson, who is also executive vice president of commercial real estate firm Jones Lang LaSalle's Arizona Tenant Representation Group, in Phoenix.

The theme presented to CoreNet Global Summit's 1,800 attendees this week was, "Space matters," referring to the importance of cutting excess facility costs.

Company executives have been asking themselves all kinds of questions: Does it make more sense to buy or lease? Should we consolidate under one office? How can we make better use of the space we have?

"Over the next six to 18 months, this will be a huge issue," Pierson said.

Even telecommuting, a relatively old topic, is getting a fresh look in the space-efficiency age, he added.

Some corporations have been experimenting with ways to make telecommuting more efficient, such as through software that extends internal systems to the home office, blurring the line between intranet and Internet.

Companies as diverse as Intel Corp. and The Coca-Cola Company gave presentations at the summit to share their space-efficiency secrets.

Coca-Cola, for instance, has been testing out a more fluid use of workspace that allows project teams to assemble and reconfigure on the fly.

"No one is assigned a specific desktop," Pierson explained, "so anyone can work anywhere."