This is a topic that has bothered me ever since I first got into this crazy CRE industry. CRE is used as the abbreviation for both Commercial Real Estate and Corporate Real Estate with very little differentiation. As far as I can tell, from common usage in various environments, Corporate Real Estate is used when you are dealing with everything about how space is used – workplace, lease admin, project management, facilities management, transactions, financials, insurance, taxes, etc. Commercial Real Estate is most often used when talking about landlords and the leasing of space.
Normally this wouldn’t cause any real problems, but in our industry it actually does. The real profits and money come from transactions. Real estate firms and many of the top professionals are attached predominately to the leasing side of the business. This is fine other than the primary need of most corporations is around everything but the transactions. See the tension that can cause?
Many professionals on the transaction side of the business have learned to talk the corporate real estate game while playing the commercial real estate game. Anytime words don’t match actions there are problems.
Many very smart people make their living as 100% at risk, commissioned brokers. They know that their best way of getting in with large companies is by helping to address the real problems that they face – usually not transaction focused. There are many that actually try to do the right thing and spend real time and money to support the non-transaction side of the business. But there are also many that talk the game without providing the appropriate action – not always because they don’t want to but just as often because they either don’t have the organizational support.
I know I’m going to tick a lot of people off with this post because many in CRE don’t really believe there is a disconnect on this point. But I’ve seen it from both sides at this point and know it to be real.
It’s something worth thinking about as you try to figure out who is best positioned to support your CRE needs.
Great way of clearing up the difference between the two, thanks for sharing!