I have started two real estate departments from scratch and was hired to improve several others. Establishing accountability for the key functions was always the first step to achieving department competency. It is easy to simply manage invoices and perform tactical work without evaluating the strategic objectives and taking some risks. As the director your role is to assess the weakness in your team’s basic practices and pursue measurable improvements even if it is uncomfortable.
A competent real estate director understands the key functional areas of responsibilities and the toolkit of skills necessary to effectively run them. Sometimes the lead person just needs to look at the work in a more strategic way and bring in better technology or strategic partners to improve results. First and foremost you have to be willing to challenge current procedures. In my most recent venture I was told the executive team had lost confidence in the department. Elevating their confidence meant more metrics, more communications and challenging the status quo especially in regards of our organizing structure.
I noticed that the key functions of real estate and facilities: Transactions, operations, project management and lease administration worked in silos. Weekly meetings of the functional leads helped everyone get on the same page and not work in a vacuum. Then we tried to link each functional area with goals that aligned with the company’s strategic goals. When individual performance goals were established they also were in alignment with the department goals. The simplicity of goal setting alignment reduced staff stress during a time of great business upheaval. Our regular meetings of the leadership team eventually dissolved years of holding back information. The culture of sharing information and supporting each other was a huge change that also improved the culture. Laughter and humor returned to the workplace…a necessity in a high stress environment. I insisted we celebrate our wins and eventually the executive team noted a real change in improved communications and department response.
Leadership in a real estate department also requires earning trust. It is essential that you have a basic knowledge of the key functions of a real estate and facilities. No one can be exceptional in all these areas but you must identify staff with the skill set to fill these specific roles. One missing piece can mean increased risk and problems so take time to evaluate your team before making wholesale organizational changes. Here is my short list of the key functions critical to effective real estate management:
- Contracts: Negotiation skills to finalize cost effective vendor, design, construction and lease agreements
- Project Management: Understand the relationship among scope, schedule and budget and how to select effective partners in design and construction; continuity and design standards are critical
- Metrics: Establish key metrics/scorecards in all critical performance functions especially in occupancy planning & budgets
- Goal Setting: Develop initiatives in each function using process improvements to demonstrate value and monitor progress
- Technology: Increased use of technology especially in database management and compliance
- Facilities Management: Ordering and tracking tools to capture requests and measure customer service
- Lease Administration: Oversight on critical dates, payables, receivables and tax obligations
- Operations: How to better process invoices, manage budgets and report on variances to plan
- Resource to other departments: Your effectiveness means more than just serving the C-Suite. You must learn to be a partner with HR, finance, accounting, legal, compliance, audit, retail and especially IT.
Your first priority is to manage to better performance in all areas. You will eventually have time to focus on your area of expertise.