What Aspects of Real Estate Operations Can be Effectively Outsourced
Real estate companies traditionally think (and organize) in terms of the “front office” and the “back office”.
The Front Office has long been viewed as the leasing, acquisitions, and other business functions that generate revenue, while “support” functions are relegated to the Back Office. The silos are starting to dissolve, and the “us” versus “them” mentality is giving way to a much more collaborative management style.
Interestingly, technology has played a significant role in the evolution of the “middle office”. Analytical capabilities, helping interpret performance and anticipate future direction, distinguish the transactional companies of yesterday from the operating businesses of tomorrow.
The middle office relies on some of the same tools that already support most real estate companies, including core property management and accounting systems. However, fully understanding analytical requirements of the middle office may warrant an optimization of those systems to maximize their utility. More often than not, additional tools must be integrated with these core systems to get a holistic perspective of company performance and facilitate decision making (e.g., budgeting and forecasting tools).