How entrepreneurs should rethink their real estate strategy to enhance their brand and sustain growth

Is “Location, location, location” still the number one rule in real estate? I recently had the chance to connect with Tricia Trester, Head of Client Solutions at Cresa, to discuss what factors are top of mind for the commercial real estate agency’s entrepreneurial clients.

How would you suggest entrepreneurs approach the development of a comprehensive real estate portfolio strategy?

To develop a comprehensive real estate portfolio strategy, entrepreneurs should align their real estate decisions with their business goals, considering factors like operational efficiency and brand image. The focus has shifted from traditional “location is king” approaches to prioritizing employee experience and sustainability. This involves analyzing employee engagement, work preferences, and how the physical space can enhance culture and productivity.

What’s the strategic importance of commercial real estate for business owners?

As a tenant, your real estate decisions?affect how employees and customers perceive your business, including brand image and corporate identity.?An office in a landmark building or a retail store in a prime shopping district can elevate a company’s market position.?For an industrial property, where you place your distribution facility?really?matters, because shorter delivery times can have a major impact on consumer choice.?Other industrial considerations include transportation costs and network optimization.

How does growth stage influence an entrepreneur’s real estate strategy?

Entrepreneurs should adapt their real estate strategy to their evolving needs. Startups benefit from flexible spaces such as co-working environments and innovation labs that offer resources and networking opportunities. As the business matures, entrepreneurs must consider product cycles, projected earnings and costs associated with long-term spaces. Securing flexible lease terms through a tenant representation broker can mitigate risks associated with longer commitments.

How can your real estate strategy affect a merger or acquisition?

A strategic real estate approach during a merger or acquisition can lead to cost reductions by identifying and eliminating redundant properties and leases. It enables companies to renegotiate leases more favorably due to increased bargaining power. Early identification of strategic markets can improve supply chain efficiency by optimizing the warehouse, distribution and production network. Assessing real estate assets and liabilities is crucial for financial planning and reporting, helping to decide which properties to keep, sell or repurpose. Real estate also involves complex tax considerations, where strategic decisions can leverage tax benefits like depreciation, capital gains deferrals or location-based incentives. Additionally, addressing employee concerns about office location or relocation early can help maintain morale and retain key talent.

It’s essential to think about how these changes will be managed. Whether a company decides to handle the shift internally or hire a consultant, how the change is communicated can impact talent retention and productivity.

How do brand identity and organizational culture influence real estate decisions?

A company’s real estate choices often align physical presence with brand identity. A luxury brand might choose a high-profile, prestigious location in an upscale district to reflect its image, and a tech startup might opt for a trendy neighborhood. In terms of culture, a company that values collaboration and openness might opt to be near businesses, restaurants and amenities that foster networking.?

Office space design can also reinforce brand identity. A company known for innovation might choose an open-concept layout with cutting-edge tech and trendy features. However, a law firm might select a more traditional layout with board-style rooms to emphasize confidentiality and professionalism.

Work styles and productivity are also important. A company culture that values individual work and focus might favor private offices or quiet zones.

Thanks, Tricia, for sharing how entrepreneurs can strategically align their real estate decisions with business goals, growth stages, brand identity and culture to enhance their competitive edge and operational efficiency.

As Head of Client Solutions, Tricia Trester leads Cresa’s Portfolio Solutions, Consulting and Lease Administration service lines. With a focus on portfolio strategy and a commitment to excellent service delivery, she helps clients navigate today’s rapidly evolving commercial real estate landscape.

The Entrepreneur Of The Year? program recognizes the most ambitious leaders who are building and sustaining successful, dynamic businesses around the world. Cresa is a proud Presenting Sponsor of the Entrepreneur Of The Year US program.

The views expressed by the author are their own and not necessarily those of Ernst & Young LLP or other members of the global EY organization.