Fast Growing Companies Need A Real Estate Plan
October 05, 2013
Bayshore Partners frequently works with companies experiencing rapid growth – revenues that increase year over year, along with steady growth in the number of employees. These companies have unique needs and opportunities in regard to real estate strategy.
Those that are growing organically will need expanding space and may need to renegotiate leases to add space. Those that are growing through mergers and acquisitions will face a different set of issues, including dealing with redundancies, consolidations and moving into new geographic territory.
When I work with this type of high growth client, I recommend a thorough assessment of the current situation and a review of their projected business requirements over the next three to eight year period. From there, we create a plan that considers both current needs and how their anticipated growth will change those needs.
This process includes defining goals and setting objectives about how management of their real estate requirements fits in to their overall business plan. This process starts at the enterprise level, and should incorporate top leadership and their vision for the company.
In creating the plan, consideration should be given to ways to reduce occupancy costs, manage growth needs and incorporate both an entrance and an exit strategy in general and for specific business units and geographic areas in particular. For example, a company that needs to expand their workforce but is not currently ready to add additional space may be able to incorporate space sharing and telecommuting as a temporary solution. Such a solution would allow them to meet current business requirements while avoiding making a move that doesn’t align with their long term goals.
It’s a well know business conundrum that a period of rapid growth can mean additional risk for companies, partly because rapid growth can strain capital resources. Having a well thought out strategic plan is critical to maintaining the focus of continued profitability.
There are many strategies that fast growing companies can incorporate into their real estate plan which will balance growth needs with financial reality. Engaging a reputable broker with knowledge, experience and relationships in areas targeted for growth will be critical to a successfully meeting real estate needs in a way that fosters continued profitable growth.
Contact us to put our skills and expertise to work for your company.
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