Insights & analysis
Thoughts and insights about valuing real estate. Regularly updated with posts that apply to what is happening today.
Stuck between tenants that are demanding short-term, flexible leases and a financing and regulatory system that demands long-term leases, landlords risk being forced to choose between two unprofitable decisions.
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In small commercial real estate markets, valuations can dictate sale prices rather than the other way around. Will this small market feature soon be coming to larger real estate markets?
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With the paradigm shift in office demand and valuation methodologies lagging behind this new reality, investors are facing a tough balancing act–how much should they focus on valuation versus maintaining Net Operating Income levels? While landlords understandably don't want to hurt values and financeability in the short-run, Net Operating Income is what pays the bills and it has to be prioritized.
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Management
As the old joke goes, when it comes to a Ham & Egg sandwich, the Chicken is involved, but the Pig is committed. The Owner-Operator path is for Pigs only—delivering Space-as-a-Service yourself means fully committing to becoming an operating business. If done right, it'll mean higher profits, but expect valuations and financing to be an uphill battle.
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Management
Management Agreements are growing in popularity, but does everyone truly understand the risks and rewards? By directly exposing Landlords to potentially volatile Space-as-a-Service income, having a strong financial model that accurately reflect the Management Agreement becomes key for both Landlords and Operators.
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Management
When you don't own the real estate and a large amount of your costs are fixed, it's a high wire act. Operating efficiency is the name of the game...for both the Operator and the Landlord. A deep dive into the first of three Space-as-a-Service delivery models: Lease Arbitrage.
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