The significance of flexibility in improving return on property investment: the UK perspective

The purpose of the study described in this paper was to explore with property and facilities managers to what degree they are able to achieve a good return for their organisations on PFM, and what might facilitate or inhibit that. Semi-structured interviews were held with 12 managers with significant experience of property and facilities management (PFM). A variety of industry sectors, and the public sector, were represented in the sample. Within these interviews, the researchers were able to explore the opinions of respondents and the qualitative data gathered provided interesting insight on the research topic. This research identifies that in practice it is extremely difficult for companies to achieve a wide spectrum of added value from property and facilities. Property management may have a lower profile in organisations than it deserves, with a concentration on cost rather than opportunity. A sense of resignation may be created by long leases, which are still “the norm” in the UK. The literature review and primary research show dissatisfaction with long leases and a strong preference for more flexible arrangements with landlords. Flexibility is inextricably linked to the expectation of better return on property investment. The demand for flexibility is felt most acutely in economic recession, which causes organisations to consolidate space and manage property and facilities at a micro level. This research was based on a relatively small sample size (12), collected from volunteer respondents in the south of the UK. On the basis of the findings, there is scope for further research on a larger scale, perhaps involving structured samples, quantitative data collection methods, and comparisons of the UK with a country where PFM choice is wider, such as the USA or Australia. Development of an economic model of the impact of flexibility on return on investment might be possible. Practical implications – This paper provides a comprehensive discussion of how PFM is typically managed in the UK and how property and facilities managers would like to see it improve in the future. This paper has identified an apparent suppressed demand for more flexibility in the property market in the UK. This could be of use to PFM suppliers in designing future offerings, and to the companies who use PFM services in articulating their requirements to suppliers.