Are there benchmarks in public real estate?

DI Werner Erhart-Schippek, MSc MRICS

Tasks and services

LIG Portfolio

Net Internal Area(560.000 m2) office buildings

vocational schools (trade and commerce)

vocational schools (agriculture)

vocational schools (home economics)

boarding schools

nursing homes for the elderly

social buildings

buildings of cultural interest

museum

others

Characteristics of Public Real Estate Management

Public real estate management focuses on:• Reducing costs for running a building• Improveing efficiency of building managment• Increaseing sustainability of a building and running this building

Compared with investors in real estate:• They don´t aim at increasing yields

Problems in the field of public real estate benchmarking:Reference values (eg areas are not known or incorrectA different point of view considering costs: they have a budget for every year …

Why benchmarking

• to compare with the best participants in the domain of public real estate management

• to learn from the best• to find out weak points and to improve• to find out inefficient processes• to achive economical management of buildings• to get to know best practice examples• to prepare key indicators for decisions• to survey the effects of measures

Why benchmarking?

Why benchmarking?

Why benchmarking?

Benchmark: Term Definition

“Benchmarking is the process of comparing one's business processes and performance metrics to industry bests and/or best practices from other industries. Dimensions typically measured are quality, time and cost.”

(Wikipedia, http://en.wikipedia.org/wiki/Benchmarking, 18th October 2011)

Kinds of Benchmarking

• Internal – external benchmarking• Following the vertical model:

– processes– location– company

• Following the horizontal model:– Life cycle phases of a building

Various Points of View

• Investors annual rate of return• Owners low costs for constructing and

running buildings• Lessee low workplace costs

Key Indicators

• Costs (€)• Measurement of consumption (KWh, m³)• Productivity• Economic key indicator for buildings• Quality assurance • Balance sheet• …..

Importance and use of KPI in REM

Some Benchmarking Datapools in Austria and Germany

• CREIS Real Estate Monitor (http://www.creis.net/index.html)

• GEFMA (http://www.gefma.de/) • KGst (http://www.kgst.de/) • ATGA (http://www.atga.com/joomla/index.php)

KGSt Benchmark Pool

KGSt Benchmark Pool

Austrian FM Monitor 2009

Realis Bench 2009costs for electricity

CREIS: Office Buildings – Survey of Heating, Water, Electricity Consumption

Example:

Survey of heating, water and electricity consumption of all LIG office buildings (public administration).

Clicking the button „analyse“ the following view is available

CREIS: all Office Buildings and their Level of Heating, Water and

Electricity Consumption

Reports

• FM Monitor by TU Graz• FM Benchmarking Bericht by GEFMA• Benchmarks für die Emergieeffizienz von

Nichtwohngebäuden by ARGE Benchmark und BM Verkehr, Bau und Stadtentwicklung

• FM Monitor by pom+ Consultung• RealisBench Immibilien-Benchmarking für die

öffentliche Hand by BayerFM• OSCAR by Jones Lang Lasalle /CREIS

LIG: Benchmarking of the Homes for the Elderly

• LIG owns four homes for the elderly (Knittelfeld, Kindberg, Mautern, Bad Radkersburg)

• During a pilot project 2009 key indicators of 21 homes in Tyrol and four ones in Styria were analysed.

Net floor ratio (m²)/bed

Water consumption/m²

Heat energy consumption/m²

Electricity consumption/m²

Evaluation cost savings

Keine Reinigungskosten bei LFS, da Schüler den Reinigungsdienst übernehmen

Reinigungskosten bei AG verhältnismäßig gering, da in Verantwortung der A2 (teilweise Eigenreinigung, teilweise Fremdreinigung)

Soweit Daten vorhanden, liegen Ist-Daten der LIG/ Land deutlich über den marktüblichen Kosten

Potenziale bei LPZ, AG und LBS werden in der Hochrechnung berücksichtigt

58,65

20,25

11,49

0,00

30,26

1,67

8,96

88,50

27,15

16,48

0,00

10,00

20,00

30,00

40,00

50,00

60,00

70,00

80,00

90,00

LPZ AG LBS LFS

Mittelwert

Min

Max

Kostenstruktur Reinigung (in €/ m² p.a.)*

Datenbestand: 100 %

Datenbestand:96,4 %(keine D.: Landhausgasse)

Datenbestand: 21,4 %(vorh. D.: 228, 221, 216)

Datenbestand: 0 %

48,40

12,10 10,56 10,56

* Objekte ohne Daten wurden nicht im Benchmark berücksichtigt

Summary

• Public real estate managers do not often use benchmarks

• Reference values are mostly not available• There exist datapools for external benchmarking• Definition of reference values • Different legal framework has to be considered• Helpfull in detecting cost saving potential

Thank you for your attention!

For further questions please contact:

werner.erhart-schippek@lig-stmk.at