{"id":1517,"date":"2016-11-02T12:00:58","date_gmt":"2016-11-02T11:00:58","guid":{"rendered":"http:\/\/revista.tuweb360.es\/en\/?p=1517"},"modified":"2020-10-01T12:13:22","modified_gmt":"2020-10-01T10:13:22","slug":"real-estate-as-a-corporate-strategy","status":"publish","type":"post","link":"https:\/\/eneasmagazine.com\/en\/bussines\/real-estate-en\/real-estate-as-a-corporate-strategy\/","title":{"rendered":"Real estate as a corporate strategy"},"content":{"rendered":"\t\t
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In this new chapter, we will address the following question: “buying or renting?\u201d from a business point of view.\u00a0If we asked the same question in terms of housing, the answer would depend on time. Concisely: if you were looking to cover a short-term need, for a brief period, renting is your solution. However, if you were willing to cover a long-term need, and you were in a solid situation, wishing to stay at a certain place, then you should consider buying.<\/span><\/em><\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t

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However, what about from a company point of view? In principle, at an early development stage, as a star-up, it is difficult not only to build credibility, but also to raise enough funds to get your business going or to provide your team a comfortable location. Therefore, regardless of a few privileged, acquiring a property is not an option.<\/span><\/p>

“To what extent is it worth having in your balance sheet a fixed asset, with decreasing value, in exchange for debt and interests and assuming the real estate market risk? Is it worth it?”<\/strong><\/span><\/p><\/blockquote>

Nonetheless, let us consider consolidated companies that after a process of expansion have purchased a number of properties in order to distribute the business geographically. To what extent is it worth having in your balance sheet a fixed asset, with decreasing value, in exchange for debt and interests and assuming the real estate market risk? Is it worth it?<\/span><\/p>

Obviously, you cannot generalize, because depending on the type of company, the business, the asset location, the operational requirements, and many other aspects, the optimal solution may change.<\/span><\/p>

What is true is that, either after the expansion process, or even within, there is the constant need for space rationalization. When broadening offices, due to a merger or to individual growth, duplicities and inefficiencies may occur, affecting the company\u00b4s functionality and profitability. For instance, all property costs (such as the IBI – property tax) must be complied at once, together with the mortgages. An adequate use of space is necessary<\/span><\/p>

That is why many companies choose to sell a part of their assets (in order to have offices that are more efficient). This has many advantages, as known by our Operational Management division.<\/span><\/p>

“What is true is that, either after the expansion process, or even within, there is the constant need for space rationalization.”<\/strong><\/span><\/p><\/blockquote>

Another option is the Sale & Leaseback, which is a long-term arrangement where the seller of an asset leases back the same asset from the purchaser, becoming the seller of the asset the lessee, and the purchaser the lessor.\u00a0 This type of arrangement is useful when companies need to un-tie the cash invested on an asset for other matter. On the other hand, the purchaser benefits in that they will receive stable payments for a specified period.<\/span><\/p>

In this formula, there are a number of key aspects that should be considered.<\/span><\/p>

From the point of view of the acquiring party, the seller should be a reliable company that, given June\u00b4s latest developments, has a reasonable prospect of continuance, with an established market position.<\/span><\/p>

Furthermore, it is essential a correct elaboration of the lease contract, because despite volatility in the real estate market, it is crucial to ensure payment liability regardless rent evolution. We must not forget that, in order to negotiate the contract conditions, the Advisor figure is particularly relevant, as he\/she will define the T&Cs that will be decisive in avoiding future discrepancies between the parties.<\/span><\/p>

Having carried out Spend Analysis for over 150 companies, and having played the role of Adviser in multiple real estate transactions, in Eneas we know that, optimizing procedures at all levels, including real estate, is fundamental in order for a company to succeed. If you are looking for different results, you have to do things differently.<\/span><\/p>\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t\t<\/div>\n\t\t\t\t\t\t\t<\/div>\n\t\t<\/section>\n\t\t\t\t\t\t\t<\/div>\n\t\t","protected":false},"excerpt":{"rendered":"

In this new chapter, we will address the following question: “buying or renting?\u201d from a business point of view.\u00a0If we asked the same question in terms of housing, the answer would depend on time. Concisely: if you were looking to cover a short-term need, for a brief period, renting is your solution. However, if you […]<\/p>\n","protected":false},"author":1,"featured_media":5666,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[223],"tags":[367],"_links":{"self":[{"href":"https:\/\/eneasmagazine.com\/en\/wp-json\/wp\/v2\/posts\/1517"}],"collection":[{"href":"https:\/\/eneasmagazine.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/eneasmagazine.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/eneasmagazine.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/eneasmagazine.com\/en\/wp-json\/wp\/v2\/comments?post=1517"}],"version-history":[{"count":5,"href":"https:\/\/eneasmagazine.com\/en\/wp-json\/wp\/v2\/posts\/1517\/revisions"}],"predecessor-version":[{"id":7059,"href":"https:\/\/eneasmagazine.com\/en\/wp-json\/wp\/v2\/posts\/1517\/revisions\/7059"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/eneasmagazine.com\/en\/wp-json\/wp\/v2\/media\/5666"}],"wp:attachment":[{"href":"https:\/\/eneasmagazine.com\/en\/wp-json\/wp\/v2\/media?parent=1517"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/eneasmagazine.com\/en\/wp-json\/wp\/v2\/categories?post=1517"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/eneasmagazine.com\/en\/wp-json\/wp\/v2\/tags?post=1517"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}