Strategic Decision Models: Multiple Perceptions, Unifying Structure

Real estate involvements include citizenship responsibility, personal and business space use, investment, and for those whose work involvement is directly or indirectly dependent upon real estate markets, employment. Real estate strategies guide participants' decisionmaking in their multiple roles, and both highlight the issues and concerns common to these multiple roles as well as isolate those unique to particular roles. Although certain aspects of the decision processes for different participants in their multiple roles reflect the actions, circumstances and objectives unique to that participant, a meaningful part of everyone's real estate decisionmaking process is subject to common market forces. Strategic decision models provide a means to connect the micro-level tasks of property operations, the negotiation process of real estate transactions, and the larger forces that define space use and place decisions.

The Strategic Real Estate Framework: Processes, Linkages, Decisions

The intention of this work is to provide a contemporary perspective for understanding the real estate markets that can guide the involvement and decisions for all sectors of society's direct and indirect involvements with the real estate process, resources and market participants. Comprehension of the multifaceted, multidimensional, substantial segment of the economy known as real estate is best accomplished through a strategic framework. Because the real estate discipline lacks coherence and concurrence about what is the essence of real estate and what are the operative paradigms for comprehending and making order of the discipline, there is need for a strategic framework that is simultaneously synthesizing, integrating and comprehensive. The concept of the real estate strategy framework both provides the basis for gaining insights into the real estate discipline and also presents a means to connect a strategic approach to real estate with the act of real estate decision-making. By understanding the real estate process, those strategic influences on transactions that follow from the real estate process can be identified. This framework can enhance the quality, reliability and prudence of real estate decisions. By understanding these interdependencies and linkages, more effective decisionmaking concerning real estate interests and the objectives of participants in the real estate markets can be achieved.

A Vision for ARES in the Twenty-First Century: The Virtual Community of Real Estate Thought Leaders

In the twenty-first century the American Real Estate Society (ARES) is a virtual community of real estate thought leaders, electronically interconnected and linked through the International Real Estate Society to counterpart organizations on all major continents as well as numerous country-specific societies. ARES growth is attributable to its emphasis on rigorous applied microeconomic decisionmaking and an inclusive, open style. The initiatives of the Strategic Planning Task Force, whose report was enthusiastically endorsed and implemented at the 1996 Lake Tahoe meetings, have led to an expansion of activities and services. Further, the "Great Water" location strategy continues to attract strong meeting participation, which meetings emphasize special tracks for the corporate space user, global portfolio investing, micro property strategies and transactions, property analytic advances, improving cognitive skills to overcome bounded rationality, and learning innovations as well as ethical and aesthetic issues, property rights and quality of life topics. As valuable as the electronic access to critical real estate research resources is, the ARES Annual Meeting continues to be the one must attend gathering for real estate thought leaders throughout the world.

Lessons from the Past and Future Directions for Corporate Real Estate Research

This study seeks to answer several questions about corporate real estate research. The first, Where should corporate real estate research be focused in the future? is addressed by a proposed alternative corporate real estate research framework that differs from what has been followed in the past. A second question that follows from the first is then addressed: Given such an alternative research framework, what types of corporate real estate issues merit research consideration? Finally, a third closely related question is then examined: Which research methodologies, databases and statistical tools are likely to prove useful to academic researchers seeking promotion and tenure, as well as corporate executives and others interested in better understanding the impacts of corporate real estate decisions?

Corporate Real Estate Research within the Academy

This study discusses the uniqueness and importance of corporate real estate asset management and distinguishes it from third party real estate investment management. A decline in corporate real estate research within the academy from 1995 through 1998 is documented and contrasted with the increasing research activity and interest in this area since 1995 by both consultants and trade associations. Reasons to account for this mismatch are canvassed from within the academy and offered herein. Finally, important questions about the future direction of corporate real estate research are posed.

Structuring the Corporate Real Property Function for Greater "Bottom Line" Impact

This study reviews the tasks a corporate real estate (CRE) function should undertake to create more opportunities for a company's real estate-related decisions to increase shareholder wealth. The major obstacles thwarting many corporate real estate executives from gaining the support they have been seeking from senior management, to more fully participate in higher value strategic planning efforts, are synthesized from several recent surveys (Arthur Andersen, 1993; Lambert, Poteete and Waltch, 1995.) Following a discussion of what corporate real estate staffs should be doing to contribute more to shareholder wealth, and what usually stands in their way, a proactive strategy is put forth for overcoming these obstacles. Lastly, in light of recent contributions to the literature (Duckworth, 1993; Joroff, Louargand, Lambert, and Becker, 1993; Kimbler and Rutherford, 1993; Lambert et al., 1995; Noha, 1993; Nourse and Roulac, 1993) on how to integrate strategic management of a company's real estate assets with strategic management of its business units and overall corporate strategy, some suggestions are made for (1) how to best organize the CRE function within a company, (2) how to make the best use of outside CRE service providers, and (3) what skills should prove most valuable to corporate real estate executives and their staffs.

In Defense of the Land Residual Theory and the Absence of a Business Value Component for Retail Property

The temptation is strong for arguing that property values can be broken down into land, improvements, and business value, as only land and improvements are subject to property tax. As sympathetic as the authors are to this motivation, the notion of a long-run business value component for retail property is refuted and the land residual value theory reasserted, while at the same time admitting the possibility of first owner entrepreneurial or development-based value creation. It is argued that any excess property productivity will eventually become attached to the land, and last that option values are an important aspect of land values that would be affected when suggesting that the appropriate value of a given property is the cost of substituting adjacent property.

Environmental Due Diligence Information Requirements and Decision Criteria

Environmental due diligence, now a necessary precondition to a real estate transaction, has been raised to a higher priority by the so-called Superfund legislation. Although passed a decade ago, only in the last several years have this law's implications and their significance for real estate transactions been recognized. The reality of environmental liability combined with substantially constrained capital availability for new development projects will introduce new standards of development assessment and sere to constrain the pace of development activity in the 1990s. The awareness of developers and advisors, representing institutional investors, of environmental due diligence requirements and how information generated in the due diligence process is employed in property acquisition decisions is the subject of this article.

Linking Real Estate Decisions to Corporate Strategy

An organization's real estate decisions will be effective if such decisions support the enterprise's overall business objectives. This result can be achieved only by the explicit consideration of how real estate strategy supports corporate strategy and the substrategies for component elements of the corporation, and then in turn how specific real estate operating decisions support the real estate strategy. This approach provides a context for negotiating competing interests and increases the likelihood that a specific real estate decision will be consistent with the enterprise's overall real estate strategy and thereby support realization of corporate business objectives.

Corporate real estate strategies and financial performance of companies

This study analyzes the relationship between Corporate Real Estate (CRE) strategy and the financial performance of major companies in the UK for two time periods, 1998 and 2003. The identification of specific CRE strategies is based on the seminal work of Nourse and Roulac (1993). The results indicate that more than 75% of the companies examined had a CRE strategy that could be mapped to the Nourse and Roulac framework and that certain CRE strategies made a contribution in enhancing the financial performance of companies. The relationship was stronger for companies in 2003 than for 1998. This was tested for both share price and profit margin as the dependent variable. This study concludes that CRE strategy can make a limited contribution to company financial performance