Real Estate Assets for Social Impact: The Case of the Public …
83
During the analysis, the analysis of the gross yield,
9 of the potential yield
10 as
well as the analysis of the vacancy rate was evident, representing the margins of
improvement in the management of the assets.
The study of vacancy has made it possible to compare available data with the
results of studies on the trend of rental market in the city and for different functional
types, verifying the positioning of one’s portfolio with respect to market benchmark.
This comparison made it possible to set a management strategy in line with the
market needs and influencing the investment choices.
In fact, the management of operations is always attributable to the whole series
of maintenance activities (ordinary and extraordinary maintenance), which has the
aim to maintain or improve the conservation status of buildings and consequently to
maintain over time the value of the assets.
With a view to optimizing the profitability of assets and resources used, it was
appropriate to reflect on the ways in which administrative management and operations
(property and facility management) were carried out by ASP. The objective was to
identify which management model (internal, outsourcing or mixed) could be more
suitable for the Company, both in relation to the state of the art and in a perspective
view of efficiency.
The analysis showed that the management model adopted was attributable to the
“internal management model.” The internal staff of ASP was completely dedicated to
asset management (regulatory compliance, cost and expense planning, management
and supervision of external suppliers, management and coordination of services
provided with internal staff) and, to a small extent, operational activities (technical
maintenance).
With respect to this topic, the research group analyzed and evaluated alternative management models: outsourcing management model and hybrid management
model with the outsourcing of operating activities only. The first model prefigures the
outsourcing of all services to a single supplier (so-called Integrated Services). This
model favors economies of scale and a reduction in costs, but in the same time, determines the loss of control over the process, on quality management in the provision
of services, in particular of maintenance ones.
The second model provides for the outsourcing of operational services to different suppliers and the presence of an internal function in the Company dedicated
to the management of contracts, with the task of coordinating, administering, and
supervising the supplies. On the one hand, this model provides for an increase in
organizational flexibility and a greater ability to control service costs, and on the
other, it requires considerable coordination by the staff involved in the management.
The widespread orientation to outsourcing by different groups and organizations
for the management of real estate assets is essentially connected to the possibility
of transforming fixed costs (employees) into variable costs (external contracts). This
choice, which in many ways can be shared in its general principles, cannot, however,
9 Gross Yield is calculated as the ratio among current fee, sum of MV and capex.
10 Potential Yield is the return that could be obtained if all the vacant spaces were leased to market
rents.
83
During the analysis, the analysis of the gross yield,
9 of the potential yield
10 as
well as the analysis of the vacancy rate was evident, representing the margins of
improvement in the management of the assets.
The study of vacancy has made it possible to compare available data with the
results of studies on the trend of rental market in the city and for different functional
types, verifying the positioning of one’s portfolio with respect to market benchmark.
This comparison made it possible to set a management strategy in line with the
market needs and influencing the investment choices.
In fact, the management of operations is always attributable to the whole series
of maintenance activities (ordinary and extraordinary maintenance), which has the
aim to maintain or improve the conservation status of buildings and consequently to
maintain over time the value of the assets.
With a view to optimizing the profitability of assets and resources used, it was
appropriate to reflect on the ways in which administrative management and operations
(property and facility management) were carried out by ASP. The objective was to
identify which management model (internal, outsourcing or mixed) could be more
suitable for the Company, both in relation to the state of the art and in a perspective
view of efficiency.
The analysis showed that the management model adopted was attributable to the
“internal management model.” The internal staff of ASP was completely dedicated to
asset management (regulatory compliance, cost and expense planning, management
and supervision of external suppliers, management and coordination of services
provided with internal staff) and, to a small extent, operational activities (technical
maintenance).
With respect to this topic, the research group analyzed and evaluated alternative management models: outsourcing management model and hybrid management
model with the outsourcing of operating activities only. The first model prefigures the
outsourcing of all services to a single supplier (so-called Integrated Services). This
model favors economies of scale and a reduction in costs, but in the same time, determines the loss of control over the process, on quality management in the provision
of services, in particular of maintenance ones.
The second model provides for the outsourcing of operational services to different suppliers and the presence of an internal function in the Company dedicated
to the management of contracts, with the task of coordinating, administering, and
supervising the supplies. On the one hand, this model provides for an increase in
organizational flexibility and a greater ability to control service costs, and on the
other, it requires considerable coordination by the staff involved in the management.
The widespread orientation to outsourcing by different groups and organizations
for the management of real estate assets is essentially connected to the possibility
of transforming fixed costs (employees) into variable costs (external contracts). This
choice, which in many ways can be shared in its general principles, cannot, however,
9 Gross Yield is calculated as the ratio among current fee, sum of MV and capex.
10 Potential Yield is the return that could be obtained if all the vacant spaces were leased to market
rents.