Corporate real estate facilities management is starting to feel the effects of millennials’ buying power and sustainability-driven habits. CRE providers will need to change how they handle facilities management to keep tenants happy and reduce spend. Meanwhile, recent changes in legislation and changing roles of Facilities Managers will continue to revolution CRE facilities management, and you need to know what to expect.
New Regulations Will Begin to Affect Corporate Real Estate Facilities Management in 2019
As explained by US Bank, new regulations governing corporate real estate facilities management will become a focal point throughout 2019. However, actual changes are not likely to go into effect until 2020, reflecting the time required to enact changes in legislative bodies on the state and federal levels. The current state of regulations is extensive, and with major changes on the horizon for 2020, corporate real estate facilities management departments will need to be mindful of the potential impact of such changes. Meanwhile, the Office of the Comptroller of the Current notes that regulatory changes will seek to optimize practices, not radically change them. In other words, slight changes are in store, and since pre-planning is at the heart of effective facilities management, CRE providers will look for new ways to enhance compliance capabilities before they are implemented.
Sustainability Will Be a Top Priority for Tenants
A key focus of corporate real estate facilities management for 2019 will include sustainability. Most consumers, which are millennials and Gen Zers, expect to do business with companies that use sustainable practices. This translates into tenants looking for sustainable-based CRE providers. As a result, CRE organizations will need to renovate existing facilities and improve use of energy, as well as ensure optimum facility condition, to attract and retain tenants.
Greater Demand on the Heels of Tax Reform
The Tax Cuts and Jobs Act will finally have a visible result for millions in 2019, and therefore, its effects will resound throughout the CRE industry. As companies take advantage of new tax breaks, tenants will expect something in return. Instead of simply pocketing the extra revenue, CRE companies that want to survive will need to reinvest in their spaces. Meanwhile, tenants will look to CRE providers with greater fervor as they open new businesses with funds saved from tax reform.
New Construction of Office Space Will Decrease
A final corporate real estate facilities management trend to consider in 2019 will be the decline of new CRE space construction. Over past years, new construction has increased, but a strong economy is having the effect of success in current spaces. Meanwhile, vacant spaces continue to plague the industry. Instead of trying to develop new CRE, builders are turning to renovations and ways to enhance existing sites, notes LemonOne, which will result in greater demand on your team. As a result, maintaining optimum facilities will be crucial to tenants looking for space, and since space demand will increase, your business could leverage demand and high-quality locations for even greater revenue. This will be in conjunction with greater demand for local warehousing space to meet e-commerce demand.
Facilities Managers Will Take on Ambassadorship Roles
As explained iOfficeCorp, Facilities Managers will become ambassadors to consumers in 2019. This is the result of consumers seeking experiences, not just products or services. Integrated property and facilities management will streamline CRE management, and the Facility Manager will be responsible for overseeing all options. In fact, creating and maintaining new attractions, such as water and fire features, will be an integral part of drawing in new consumers to spaces, and as a result, such features will draw in more tenants willing to pay a premium.
Plan for Success by Knowing the Top Trends in CRE Now
Corporate real estate facilities management will change in accordance with new laws, regulations and demands, especially from the group with the largest buying power on the planet—millennials. CRE providers need to know what millennials want and align their goals with the top trends for 2019.