By Dave Clifton
Content Strategy Specialist

Facilities underscore just about every aspect of operations, which makes them an important consideration in various facets of business planning. Among the largest of these considerations is real estate. What is facility management in real estate? What considerations do facilities managers need to make to optimize facilities, to offset the cost of real estate on the balance sheet? These are questions companies need to answer as they plan for the future.

Facilities management is a segment of broader real estate oversight. It’s focused on understanding the role of facilities in the total scope of a company’s physical presence. In addition, it identifies costs and needs associated with facilities and how they impact the business’ mission, goals, and strategies.

What is the role of facility management?

The role of facility management becomes an important part of planning for real estate decisions. What’s the total cost of ownership for your office space in Los Angeles, CA? What kind of capital expenditures are on the budget for next year? Do you have the maintenance staff to take on 10,000 square feet of additional space? These real estate questions are only the tip of the iceberg and part of a significant reliance on facility management.

Through hands-on facility management, stakeholders can get the answers they need to make high-level real estate decisions. Using the above examples:

  • Lease data and cost of upkeep can shed light on total cost of ownership
  • Enterprise asset maintenance (EAM) data shows upcoming capital expenditures
  • Evaluation of current square footage and maintenance staff helps plan for expansion

Without facility management insights, it wouldn’t be possible to make data-driven decisions about real estate at a high level.

What is the difference between property and facility management?

There’s often confusion between property management and facility management, especially in relation to broader real estate decision-making.

  • Property management involves working on behalf of the building owner to address tenant concerns. Property managers fill vacancies, oversee the safety and security of property, and, above all, maintain the profitability of the building for the owner.
  • Facility management encompasses the day-to-day and ongoing maintenance needs of the building and its occupants. The primary focus is on the building itself and the impact of its many systems on the occupants and visitors.

For businesses that own the building(s) they operate in, there’s likely a property and facility manager on staff. For companies leasing, their facility manager likely liaises with a property manager to ensure frictionless operation. In either case, property and facility management are important for real estate planning.

For example, if a property manager needs to raise the rent on behalf of the building owner, it’ll affect the cost of operation for the company occupying that space. Or, as a building ages, facilities costs might go up. It’s up to a facility manager to recognize and communicate this uptick in cost from a real estate perspective. Both perspectives come together to enhance the decision-making capabilities of real estate managers and C-level stakeholders looking ahead.

Consider facilities management software

Data is the most important link between facility management and real estate decision-making. To get it, facilities managers need to be diligent in collecting it, which means creating channels to collect and aggregate it. This is where facilities management software shines.

Consider a question like “Do you have the maintenance staff to take on 10,000 square feet of additional space?” It’s impossible to gauge without data to support an answer one way or another. Facilities management software can collect and yield relevant data to answer this question:

  • Total support tickets filed over the last 12 months
  • Average time between ticket submission and resolution
  • Average number of tickets worked per maintenance staff member
  • Total cost of maintenance over the past 12 months

These variables and others distill down into the variables required to provide a clear answer for real estate planning. A company might look at the data and say “based on the expediency of support ticket resolution and available staff, yes, we can handle an additional 10,000 square feet.” Or, they may find insufficient capability to absorb more duties over a broader scope of facilities. Either way, data bridges the gap between the current situation and next steps. It’s only possible with data gathered through facilities management software.

Real estate considerations are paramount

Consider the cost of real estate on your company’s balance sheet. What are you getting in return? Facilities management as a function of real estate planning lets companies see where their investment takes shape and how it impacts broad operations. It’s a look past the numbers, at how important real estate is and what it takes to keep your workforce, facilities, and company on a trajectory for success.

Keep reading: Why is Facility Management Important for Productivity?

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Jonathan writes about asset management, maintenance software, and SaaS solutions in his role as a digital content creator at Eptura. He covers trends across industries, including fleet, manufacturing, healthcare, and hospitality, with a focus on delivering thought leadership with actionable insights. Earlier in his career, he wrote textbooks, edited NPC dialogue for video games, and taught English as a foreign language. He hold a master's degree in journalism.