Lucernex expert and President Joe Valeri (see Joe’s management summary here) provides details of why Location is the key to Real Estate Technology.
In the last Blog I talked about the importance of an IWMS using the Location as the central organization point for all data.
By centering on the Location you can:
- Track all entities within your Portfolio or aggregate information to track your entire Portfolio
- Track all Center information including Leases
- Track all Facilities and equipment on a Campus
- Track each tax Parcel within the Location
- Track multiple planned Locations by market in multiple Programs
- Manage all collected data for multiple Sites of interest for every planned Location
- Manage as many Construction Projects as you want on one or more tax Parcels of the same or different Prototypes
- Maintain as many Facilities as you would like across one or more Programs
- Track all Spaces in each Facility, how they are used and the associated Leases.
- Run as many Capital Projects as you need
- Administer multiple Leases and subleases on a group of Facilities or on individual Facilities
- Track all real estate related Contracts for Equipment, Land, Services, etc….
- Maintain as many Franchisees information as required in the same or across multiple Facilities
- Track all Lease income and expenses on any Facilities or Location
What makes Location Centric Management most powerful is the infinite combinations of business arrangements it can handle. A few examples:
Let’s say you company is a Convenience Store Retailer but also a real estate developer. You buy land that crosses two jurisdictions in an emerging market, put in one of your stores but also develop the surrounding property with a strip center, a hotel and two small office buildings.
- One location, multiple tax parcels, three facilities, one owned store created from a construction project, one center (also a facility) with multiple leases, two facilities for office building with multiple spaces and leases including some spaces with multiple leases. You used one of your prototypes to develop your store and it exists within your Rural Market Program. You can now launch capital projects across your entire Rural Market Program to automatically include this store. Every detail on each item discussed above can easily be viewed at the Location level with dashboard, alerts and reports to ensure a senior executive responsible for one or more locations or parts of a location (like Office buildings) can see everything related to the Location and drill down as needed.
Your company is a large insurance company with retail-like locations worldwide that provide a local office for clients to call and receive service from. You have three large headquarters, one of which you own that is a multi-facility campus, in 2 different countries plus 600 local offices that you manage the leases for.
- 603 locations. One location is a campus, built on 3 tax parcels across two jurisdictions. The campus has 4 facilities on it, one of which has one floor subleased to 6 different food vendors. Two locations have one building on them, each having one lease and multiple equipment contracts. 300 of the 600 local offices are simple leases with 5 year renewals. 200 of the others are in Asia Pacific and have 1 or 2 year renewals. The last 100 local offices were acquired in a takeover of a competitor and are now subleased.
While Location Centric Management can do all of that it also can manage simpler structures just as well without making it any more complex than a system that can handle only simple location structures.
The next obvious question is why wouldn’t a technology for real estate be location centric? The simple answer is that many vendors started out as point solutions targeting one area of the market then built up their solution to address the image of “IWMS” or customer needs. Think about how a house looks that began as a small colonial and then had multiple extensions put on, often hastily, to meet some immediate need. Is it going to look or function as well as the same size house designed up front to meet all the needs of its users? And how much time and money would it take to tear it all down and start over? It is much the same with IWMS technology, those vendors that started out looking at the entire lifecycle will be able to provide location centric applications, built on a single framework, that best address the end users needs without trying to wedge each users special needs in with customizations or elaborate configuration.
OK, now comes the part where I have to admit that, of course, this is my view as one of the visionaries (with Ken Brown) behind the Lx Retail IWMS Store Lifecycle Management software. Other vendors will argue that the Facility or Campus or Lease is the central entity. From their point of view I am sure that makes sense and many could likely write a more eloquent argument to make their case. What matters to someone choosing an IWMS solution is whether all the current or future business arrangements can be handled in any combination the customer can think of and, more importantly, is the application designed to handle those arrangements or will it need to be customized or heavily configured to meet those needs (which would indicate little flexibility to change and limitations on connections between the moving parts) or worse yet – is the technology vendor forcing you into managing your locations as they dictate, rather than leveraging the unique structure that has made you successful and is your competitive advantage. Also, what is the structure of the database? Is it one database and one code base or its it a complex interconnection of separately designed products and databases tied together with a front end concealing a lack of singular design vision. I will save the details of that discussion for another Blog!
Lx Retail was designed from the ground up as a 100% web-based location centric system with a single database accessed by a single front end programmed in a single code base by the same group of developers since 2000 when we were founded. Even our recent expansion of the suite to include complete lease and contract administration (led by SLIM Lease Administration designer Ken Brown) and Capital Project Management has been added directly into the original structure. We can handle any combination of uses of a location that any organization can dream up! See our IWMS competitor chart or give me a call to discuss how we match up to other IWMS vendors.