Corporate real estate risks

Abstract

Purpose – The purpose of this paper is to identify the corporate real estate (CRE) risks that might influence the added value of CRE to the shareholder value of an organization and to analyze if there are differences in perception of these risks according to job and company specifics of the respondents. Design/methodology/approach – A literature study was carried out to identify the CRE risks. In addition, a number of interviews were held with CRE specialists to complete the list of risks. An inventory of the risk perception was gathered by making use of a survey among 70 end-users, 16 CRE consultants and 2 CRE academics. Differences are analyzed making use of Kruskal–Wallis tests, Mann–Whitney U tests and t-tests. Findings – In total, 43 risks in six different categories were identified. It turned out that the risk perception differentiates the most per geographical location or industry segment. The size of the organization (number of employees) does not appear to influence the way in which the risks are perceived. Practical implications – This paper provides CRE managers and risk managers with a basis for a risk register that contributes to identification of possible CRE risks. Besides, it enables a comparison of their risk perception with industry peers. Originality/value – Earlier research concerning CRE risk management approached the subject from a specific point of view, but did not provide a CRE risk list using an integral perspective and covering multiple topics. Also, this paper provides insights in how CRE risk management is perceived in practice.