Report: Trend in Asia Pacific is Reducing Real Estate Costs

SINGAPORE-The “mega trend” for Asia Pacific commercial real estate executives is reducing real estate costs, according to Jones Lang LaSalle’s inaugural Corporate Real Estate Impact Survey, which queried 50 executives with control over some 70 million sf of office space.

“While this appears to be stating the obvious, the scope for savings runs far beyond the simple reduction of rental costs,” says Phil Simpson, international director of corporate solutions at JLL. “Many corporations have been focusing their time and resources on short-term measures to avoid capital expense and accumulate objective savings and this immediately restricts their ability to address more fundamental approaches that bring in longer-terms rewards. There are other more significant measures that corporations can explore to reduce their real estate costs in the long run such as restructuring and rationalizing portfolios, improving procurement processes and contract management, and re-engineering the property administration process.”

Data for this issue of the CREIS has been obtained from over 50 corporate real estate executives drawn from a wide spectrum of industries. Approximately 42% of respondents were in the financial sector, 38% from the IT and Oil & Petroleum sectors and the remaining 20% from Communications and Business Services sectors. The respondents employ a total of more than 240,000 staff in the Asia Pacific region and occupy approximately 6.5 million square meters of office accommodation. Other key CRE issues and mega trends highlighted in the survey results include: