Bangia

Welcome to MMIX--the year 2009. Most of us in the corporate real estate services world have a guarded optimism for a recovery but we also are well aware that there will be more bad news before we see good news. In part, the optimism is due to the arrival of a new presidential administration. In part, there is a feeling that it can’t get any worse-- as my investment biz friends say, the pessimism is already priced in. But in my opinion, the optimism is a result of the fact that we’ve finally, openly, used the "R" word. By admitting to ourselves that we are indeed in a recession, we’ve taken the first step towards recovery. Now before you think I’m going to outline a 12-step program for the economy, take note--this article about recovery is not really about recovery. It’s about surviving until the recovery begins--which many experts agree should be in Q4 2009.

When times are tough, the worst of society and the best of society come out of the woodwork. On one hand you have corporate scandals such as Satyam Corp. and investment scandals such as that involving Bernard Madoff. But you also see good things happen. You see greater collaboration and cooperation among people who are in the same boat. This was evidenced by reports of high attendance at CoreNet Global’s Discovery Forums, for example. After all, if everyone is feeling the pinch, you can honestly use the Clintonism of "I feel your pain." Moreover, you can do something about it.

So what can the corporate real estate professional do to ensure they are still in a productive role with their companies when the tide turns and the recovery begins? Here are a few thoughts:

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• Concentrate on paring back the non-essentials:
  Unfortunately, in 2009 many companies will read the above statement incorrectly. Many companies undoubtedly will have a knee-jerk reaction and cut the non-essential. Many companies will incorrectly label necessary services and functions as non-essential. It is important to understand this suggestion means reducing the number of moves, adds and changes, or the number of workplace redesign initiatives. Paring back does not mean making decisions that will disrupt your business. Nor does paring back mean putting yourself in a situation where you can’t recover along with the turning economy because you reduced your workforce so severely that you don’t have the flexibility to grow when the time comes.
• Revisit your internal workflow:
  A down economy is the perfect time to look at your own internal processes and determine if your workflow and team structure are properly aligned. Attrition, functional re-adjustments, and changes due to your company’s M&A activity over the past several years, may have caused a shift in roles and responsibilities that have unwarranted results. Thoughtfully looking at your internal processes may shed some light on inefficient practices and or improperly placed resources. However, be careful. Many companies have used these types of initiatives to justify headcount reduction. You must clearly communicate that this is a pure process improvement initiative or begin such an initiative after a restructuring has taken place.
• Finally, leverage your advantage as a tenant:
  Now is the time to make decisions to close underutilized facilities and consolidate into lower-cost locations. Now is the time to demand that the landlord ensures their financial viability and longevity. Now is the time to take every advantage that is yours as a tenant. We all know the term buyer’s market and seller’s market. If ever there was a tenant’s market: now is the time. If you leverage your advantage as a tenant and demand the rights you are entitled to, you can position your real estate portfolio in time for the recovery and be sitting on top of the wave in a very advantageous position both from a cost and a risk mitigation standpoint. Make sure this initiative is in your MMIX.

Vik Bangia is vice president of National Accounts for CresaPartners. The views expressed in this article are the author’s own.