Changing Winds Ahead Japan Corporate Real Estate Survey 2013 Overview

1 Japan survey

31 responses

3 trends

1

31

3

Trend #1 Enhanced Demands from Senior Leadership

Present CRE with Fresh Opportunities

Enhancing productivity is the new

rationale for CRE…

…with workplace productivity

grabbing attention of CRE and

senior leadership alike

4

Question: What produciivtiy outcomes is your organization expecting the CRE function to deliver?

Productivity is now deeply ingrained in the day-to-day

focus of CRE teams in Japan

5

Senior leadership expectations for CRE to deliver respective productivity outcomes

Question: What produciivtiy outcomes is your organization expecting the CRE function to deliver?

6

Extent of change in the global corporate

workplace as seen by Japan CRE leaders over

the last three years and envisaged over the

next three years

Question: To what extent has your corporate workplace transformed over the last three years and next three years?

Workplace productivity is being addressed through

CRE but more could be done

7

... CRE teams are also required to

build or expand platforms for

businesses stats

3.2 looking to the future

evolution of portfolio

“Don’t Know” and “Not Applicable” have been

removed for analysis purposes

Questions: C20 / Total n=536

Note - Net growth is calculated as the percentage of respondents who expects portfolio size to increase minus the percentage of respondents who

expects portfolio size to decrease. Shaded area indicates average net growth rate across the region

The select growth markets that Japan companies are

expanding in…

… are also the world’s least transparent real estate

markets

Source: Jones Lang LaSalle Global Real Estate Transparency index (GRETI) 2012

10

Level of Risk Aversion in Japan since 2010

Question: Compared to 2010, how would you rate your business’ attitude toward risk (appetite for growth versus operational risk)?

Slower domestic growth triggers overseas expansion in

spite of risk aversion

11

Aftermath of 2011 Japanese Earthquake and Tsunami

Question:

Which of the following changes have occurred as a result of the 2011 Japanese earthquake/tsunami?

To what extent did your portfolio suffer as a result of the 2011 Japanese earthquake/ tsunami?

Natural hazards are a consideration that cannot be

overlooked, especially in emerging markets

Trend #2 Mismatch between demand

and capacity results in under-

performance risk

13

No CRE leader in Japan feels well-equipped to meet all

demands being placed upon them

Do CRE Executives in Japan Feel Well-equipped to Address Senior Leadership Demands?

Question: How well-equipped do you feel to meet the demands of the senior leadership?

14

Structural constraints present a significant risk to

addressing leadership demands

Types of Constraints Undermining the Strategic Position of CRE

Question: Is your internal procurement team actively involved in CRE?

15

Many Japanese companies still lack a dedicated CRE

function

Where Does the Global CRE Head Reside?

Question: Within what department does the global head of CRE reside?

16

Less elevated reporting lines dilute strategic alignment

Reporting Lines for the Global Head of CRE

Question: To what level of the organization does the global head of CRE currently report?

Trend #3 Forward-looking CRE teams stake on winning

partnerships

Despite CRE outsourcing gaining momentum, Japan is still

lagging behind global peers…

19

Companies in Japan are looking beyond simple tactical out-

tasking with service providers

Attitudes Toward CRE Outsourcing

Question: Please rate your current attitudes toward outsourcing on a scale of 1 to 5, where 1 means that outsourcing represents a tactical

transaction, mainly with the lowest cost supplier, and 5 means that outsourcing represents a strategic relationship.

20

A broader range of solutions are being sought, creating new

models, interrelationships and points of engagement

Delivery of Major CRE Services

Question: How would you best describe the delivery of the following CRE services, today and three years from now? (Fully outsourced being ‘5’ and

fully in-house being ‘1’)

Note: The mean score is calculated as the sum of the multiplication of each score with their respective number of respondents, divided by the total

sum of respondents.

21

… cross-functional

collaborating is presenting

CRE an opportunity to uplift

its relevance and recognition

22

Current level of collaboration between CRE and other support functions

Question: Today, how would you describe the collaboration of CRE with the following business functions?—Today and in three years’

time

Collaboration between CRE and business support functions

is already occurring with significant and surprising intensity

Japan Corporate Real Estate Index 2013

24

In many aspects of CRE, sizeable variance exists between

Japan and the rest of the World

Where Japan lies, in relative to global peers