Corporate real estate investment banking is where corporate money is invested for the purpose of business. The funds in this type of banking are usually put into short-term holdings that will earn a higher interest rate than long-term investments. This type of banking is called ‘non-productive’, because it does not make anything or generate income. It simply facilitates the transfer of cash between investors and corporations. Thus, it is often referred to as corporate finance.
Businesses in various industries can benefit from corporate, real estate facility management. This is because it helps a business to achieve its financial goals by investing in real estate that earns a higher return on investment (or ROI). The most common factors behind the ROI are lower costs, better timing (the timing of buying and selling according to the direction of the market), and better analysis.
There are two types of property management firms: individual and institutional. An individual facility manager is a corporation, a limited liability company, a partnership, or an entity comprised of individuals. Institutional property management is a larger group of individual facility managers, often including banks and financial institutions. They specialize in corporate real estate management and are involved in mergers and acquisitions, leveraged buyouts, distressed property investing, and real estate refinancing. Individual facility managers tend to specialize in one or two aspects of commercial property management such as management or investment Banking, financial advising, property management, or finance and facilities administration.
The best way to understand the difference between corporate, real estate portfolio management and individual facility management is to consider how each firm controls its assets. An institutional manager will oversee the whole asset portfolio, making financial decisions regarding each asset according to a predetermined set of rules. This may include analyzing the risk to the firm’s capital, determining whether the firm needs to expand its options, looking at the return on equity and other factors. The firm will use quantitative and qualitative analysis, technical and fundamental analysis, and market data to make decisions regarding all aspects of the portfolio.
An individual facility manager tends to manage their facility for the benefit of the owner. They typically make decisions about what to do with the property on the property-owner’s behalf and are not involved in making decisions about day-to-day operations, such as which tenants to rent, when to rent, or what types of tenants to get. Facility owners often own and maintain the property they are renting, so they have little or no involvement in day-to-day decisions. This can mean that the facility manager may have less knowledge about certain processes, such as tax laws and financing strategies, than the institution manager does. It can also mean that the individual facilities management firm may not be the best choice for certain kinds of properties, such as office buildings.
Facility management firms can handle a variety of different kinds of corporate real estate investments. They can manage single facilities or large facilities. They can also specialize in a particular kind of facility management, such as office buildings or industrial properties. There are even facilities management firms that will take over entire businesses from a certain geographical area. These firms typically have more experience in dealing with businesses, but they can handle any business property for the owner. These firms can coordinate all leasing, security, and accounting issues so that an owner doesn’t need to personally handle the details.
Corporate real estate managers will consult with an investment firm that represents the owner, so they don’t need to be concerned with the owner’s feelings on this matter. It is the facility management firm’s responsibility to find a suitable tenant for a piece of property, to find a proper rental agreement, to pay the lease on time, and to perform all other necessary tasks to keep the property running smoothly. This means that facility managers sometimes have to make unpopular decisions, which are based largely on economics. If these decisions aren’t made correctly, the owner may be forced out and can lose the entire investment made.
Business owners can trust corporate real estate professionals because these professionals have experience handling numerous different kinds of properties. In fact, many corporate real estate professionals will train their staff in how to deal with specific kinds of properties. For instance, facility managers may need to handle airports, shopping malls, industrial complexes, and other kinds of corporate real estate investments. Therefore, they need to know a great deal about the kinds of places that they are dealing with, in order to run them efficiently and to avoid problems. In this way, corporate real estate professionals have the knowledge and expertise to really get the job done.
