occupiers
REAL provides input at critical stages throughout your 'premises lifecycle'. We deliver integrated property solutions to improve efficiency and reduce your operating costs.
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Portfolio Strategy
Property Acquisition
Corporate Acquisition
Cost Reduction
Accounting Services
IAS37 Strategy
Legacy Disposals
We can take full outsourced responsibility to reduce your in-house workload. Alternatively we work alongside your premises or facilities team as a flexible resource, responding to varying needs for our specialist skills. Our background in FM, CRE, investment, finance and accounting leaves us uniquely qualified to act as the interface between Board strategy and property operations.
Please contact Richard Wojtowicz for a confidential preliminary discussion.
Portfolio Strategy
Devising a Property Strategy to fit your Corporate Plan
In an ideal world, property tactics would merely respond to Corporate Strategy, but in practice property rarely provides appropriate flexibility. Furthermore, flexibility comes at a price, so the level of flexibility in your occupational portfolio should be optimized to minimize the overall cost. Property therefore needs to inform Corporate Strategy, as well as respond to it.
We build a ‘benchmark’ current financial model, then develop and test various scenarios against it. Outputs cover the optimum scenario including related financial implications; required activity list and programme; and considerations of alternative tenures (including regearing existing leases, full and partial outsourcing, sales and leasebacks, pre-lets etc).
Property Acquisition
Maximising efficiency when acquiring new premises
New leases and purchases are sometimes driven by urgent operating requirements – but they must also fit the wider corporate strategy and avoid financial pitfalls.
Our services include portfolio planning, strategic and tactical advice, search, selection, negotiation and project management for new operational requirements, coupled with FRS12/IAS37 exit strategies for potential legacy properties. We can also source external funding where freehold acquisition is identified as the best option.
Corporate Acquisition
Assessing and minimizing liabilities
Hidden liabilities, including guarantees and ultimate responsibility for assigned leases, can lurk unnoticed on the books of potential target companies. Rationalising two companies’ merged portfolios brings an additional set of issues.
REAL offers a due diligence service to identify operational property risks and the financial implications of existing and potential 'Legacy Leaseholds' prior to completion. We are accustomed to working discreetly to assist your senior executives devise and implement property strategy, often in an environment sensitized by considerations such as employment, competition, stock exchange disclosure and speed.
Cost Reduction
Reducing your Service Charges and other occupancy costs
Overcharging can arise through mistake or by a liberal interpretation of the lease clauses, especially as lease expiries approach. Changes in managing agents or landlords, and reconciliations at the expiry of a lease require particularly careful analysis.
Our service in this area has therefore been devised to produce supplementary certificates for internal governance purposes, confirming that expenditure has been properly billed. In the process we search for savings, with the majority of our remuneration on a performance-related basis linked to refunds and savings.
We have achieved savings backdated several years translating into significant refunds. Often the savings are repeated in subsequent years and in some cases can even imply a lasting reduction each year until the expiry of the lease.
Accounting Services
Outsourcing your Service Charge and Property Accounting
We can take responsibility for all your property accounting, to minimize your administrative burden, maximize recovery from subtenants, streamline the production of corporate and management accounts and budgets, and achieve refunds and ongoing cost savings.
We will handle your property bought ledger and all subtenant accounting. You can reduce your admin to one bill and one remittance from us per quarter.
Integral to this arrangement, we will seek refunds and savings and look for scope to run service charges more efficiently.
FRS12/IAS37 Strategy
Strategy for Statutory Reporting of Surplus Property Provisions
Company accounts have to reflect the capitalized costs of surplus properties. Whilst FRS12/IAS37 is a technical reporting issue, it reflects real cash impacts on your business. Our aim while dealing with the technical review is to deliver meaningful reductions in the current and potential costs of surplus operational property.
Outputs include estimates of the potential total liability; the decline in these liabilities over time, due to the expiry of headleases; means by which growth in liabilities can be controlled, and could be reduced; steps to minimize your ongoing management burden; and strategy options. A vital consideration is the likely impact on your accounts of provisions arising from a decision to vacate certain properties at a given future date.
Legacy Disposals
Reducing Costs through Legacy Disposals
Our Legacy Estate service provides corporate clients with a new method to control, reduce and sometimes exit from FRS12/IAS37 liabilities for surplus operational properties.
Assignments and sublettings of surplus operational properties (or ‘Legacy Estates’) are challenging as they require the simultaneous agreement of the landlord, yourselves and the prospective occupant. The financial and legal complexities of these transactions, and surrenders, add to the difficulties faced by traditional agents handling this type of work.
Our Legacy service supplements traditional agency activity by drawing on our skills and lateral thinking in the fields of property investment, CRE and accounting to bring about a positive shift in the disposal dynamics. We review, supervise and drive forward the marketing campaign, where necessary taking over negotiations from the agent, and project-managing the transaction through legal stages to completion.