JLL’s recently released report, Global Corporate Real Estate Trends 2015, is this year’s must-read for any Finance or CRE professional. The report’s statistics reveal developing trends in four major areas: centralization, integration, expectation and outsourcing.
The outsourcing trend, in particular, indicates some interesting data:
- 86% of respondents actively outsource corporate real estate activities today.
- 88% of respondents will outsource facility and property management within three years.
- 72% of respondents will outsource lease administration within three years.
Ultimately, the report shows that outsourcing is playing a larger role in “managerial, administrative and transactional tasks,” with capital planning and strategy expected to primarily remain in-house. But, there’s one thing it didn’t mention that it probably should have: corporate property tax management.
The Benefits Of Outsourced CRE Property Tax Management
Interestingly, a majority of respondents in the JLL survey regarded outsourcing decisions as strategic and focused on “long-term value.” Fewer respondents use outsourcing to achieve short-term cost savings.
CRE and Finance executives interested in long-term value – especially those with multi-property portfolios – should consider outsourcing corporate property tax management.
Outsourcing your property tax management is beneficial for several reasons. Specifically, you can expect:
- More focus. Having a trusted partner who specializes in property tax assessment and appeals around the clock frees up precious hours for your CRE team.
- More leverage. Large, unanticipated commercial property taxes can burn through company resources quickly and send you scrambling for solutions. Working with a dedicated expert helps you stay ahead of possible reassessments, giving you a leg up if you need to appeal.
- Fewer complexities. Commercial property tax laws vary widely by jurisdiction. As a result, managing appeals for a large portfolio is difficult. Outsourcing lets you handle big challenges proactively, with relatively little in-house effort.
Finding The Right Partner
If you decide that outsourcing your corporate property tax management is right for you, make sure you find a partner that understands both real and personal property, has a strong property tax appeal track record and begins the documentation collection process well in advance of appeal dates.
You should also look for a partner that offers a turnkey solution and lets you focus on your core business without worry. Effective turnkey partners provide full transparency as well as regular reporting, and they’re able to show demonstrable ROI for existing clients.
If you are a CRE or Finance executive with a complex portfolio, complement your in-house strategy with outsourcing partnerships that deliver strategic, long-term value. Finding the right partners and developing the right action plan takes time, but it’s worth it if you can achieve low costs, high value and, where applicable, reduced risk.
Not sure if you should outsource property tax management? First, find out if you’re paying more than your fair share.