Commercial real estate owners experience the greatest opportunity to define and achieve successful long-term strategic plans in organizations where asset managers, acquisition teams, and project management align.
There is a clear through-line, in the form of a coordinated capital plan and investment strategy post-acquisition through disposition. This method views assets within the portfolio with a value-add approach. Well considered decision making results from a collective understanding of the long-term capital plan, and how the organization will achieve desired results.
Acquisition teams set clear expectations during underwriting so that asset managers fully appreciate the scope of work. The asset managers’ subsequent partnership with project management includes assigning priority to the plan(s). Transparency and centralized access to all necessary resources and information are essential. Fortunately, purpose-built technology exists to support this collaboration.
Here’s what successful organizations know,
project management is the heart of asset management.
Planning and collaboration between project and asset management are essential to achieving a long-term value-add strategy. If once assets are acquired, asset management is seen as their strategic owner, then project management bears tactical and operational responsibility for overseeing the work that will grow value throughout its lifecycle.
Successful asset managers are measured by how well they maximize the value of assets under their control. The key to their success relies upon sharing responsibility for achieving that outcome with project managers. For project managers, success is based upon delivering completed construction projects on time and within budget. Collaboration is ongoing, as markets, project scopes, and priorities shift. Asset managers actively mitigate risks that change schedules, or their overall budget and impact. Project managers navigate staffing or resource challenges. Direct bilateral communication is fundamental.
1. Asset and Project Management should jointly build a roadmap of projects, with contingencies.
2. They should share responsibility for KPIs related to project planning and deliverables.
3. Each team has a better chance to succeed when there are open channels and regular information sharing regarding status updates and budget irregularities. These two areas are challenging at best, and often the reason why capital planning happens annually and not in real time. Technology optimizes the process, making information sharing easier, faster, and more accurate.
The success of each team is directly connected to the other. According to one article entitled “The Interrelations between Asset and Project Management,”
"Both disciplines are heavily interrelated. Asset portfolio planning is impossible without the planning information from projects, programmes, and project portfolio...Asset management is impossible to do without project management and vice versa."