Budget season is upon us. It’s the time of year when organizations begin gathering information on the financial and operational performance of their properties and going through multiple rounds of reviews until – at last – budgets for the coming year are finalized in December.
We chatted with three industry experts to find out how they stay sane, on top of the details and on time. Here’s what they had to say.
Give yourself plenty of time – I find gathering proposals from vendors, brainstorming projects for the next year, and just generally gathering all the information you’ll need will take longer than you anticipate. You’ll cause yourself less stress by gathering this information early.
Make an overall schedule early in the process – I find it easiest to work from your ultimate deadline backwards to give yourself enough time to do what you need to do to meet internal deadlines. From my experience, you largely are gathering numbers, inputting numbers, generating tenant recoveries, putting together final packages of reports with variance notes and then submitting. Along the way, there are probably several review periods at each point as well. Add some cushion to your timeline to account for the unexpected delays or changes. You’ll be doing your day-to-day work at the same time, and that inevitably will interfere with your budget timeline at some point as well.
Delegate Responsibilities – Several different people will likely play a role in the budget process. Make sure everyone understands their role, responsibilities and timeline for their work. It helps the process flow smoother and everyone feels empowered that they are playing a role in the team process.
Keep track of changes as you go – I find it easiest when reviewing budgets to create a list of items that I don’t think are final or ready for the next stage. Then, as we work to update those items, we can check them off without having to go back through the whole package and having to constantly remember what you have to update.
It is a year-long process – Every year we forget something that we meant to add. We forget to add tax to a proposed cost, have a new item come up that will be ongoing in the future, or just have thoughts on ways to improve for the next year. I keep a running list that I update as soon as one of those items pops up throughout the year. This year, one of my buildings has 30 items, and with everything else going on there is no way to remember them all without recording them as they come up.
Josh Turnbull, General Manager
Oxford Properties Group
1. Seek out and adopt technology platforms that help you maximize efficiency.
2. View vacant space as a product and manage it to maximize its marketability.
3. Property managers should invest time in developing strong relationship with property leasing team.
Cris Thomson, Senior Project Manager
Normandy Real Estate Partners
These days, it seems like there are new and niche ways to utilize real estate popping up everywhere you turn. Coworking spaces are the hot ticket item in 2018 and 2019. It got us wondering, should this new use of space impact the way you budget?
Coworking changes occupant density, plug load, and in some cases the operating hours of a space, but Ben Myers, Director of Sustainability at Boston Properties, has found it to be a generally lower driver of energy use compared to the following factors:
While coworking may have slightly higher density and space utilization, if the coworking footprint across your portfolio is relatively small, Myers thinks you should focus more on the energy budget drivers listed above.
Ben Myers, Director of Sustainability