Abstract
This chapter focuses on the financial side of Corporate Real Estate (CRE). First, the effect of ownership or leasing on the balance sheet is discussed. In addition, the lifecycle effects of ownership are looked at in connection with renovation, restructuring or alternative use. Particular attention is paid to the importance of regularly valuing CRE at market value and the financial risks of not valuing and not strategically managing CRE. The chapter shows that CRE is not always easy to value. Buildings may have specific characteristics without any particular market value, or which are only valuable for similar enterprises and specific use. The value might also be influenced by industry trends or labour costs, followed by shifts of the company’s activities to other locations or even other countries. Consequently, active CRE financial management should have a high priority. Involvement in business plans and decisions is essential to fulfil that role.
| Original language | English |
|---|---|
| Title of host publication | Facilities management and Corporate Real Estate management as value drivers |
| Subtitle of host publication | how to manage and measure added value |
| Editors | P.A. Jensen, T. van der Voordt |
| Place of Publication | London |
| Publisher | Routledge Taylor & Francis Group |
| Pages | 239-253 |
| ISBN (Electronic) | 978-1-315-69515-0 |
| ISBN (Print) | 978-1-138-90718-8 |
| Publication status | Published - 2016 |
Keywords
- CRE ownership and lease
- valuation
- alternative use
- value monitoring
- CRE
- financial risk