The Organisational Structure of the University Real Estate Department

Abstract

University real estate organisations are heavily influenced by the context in which they operate. Within this dynamic context, real estate organisations choose a particular organisational structure. Changes in organisational context can imply a reconsideration of the organisational structure of the real estate department. As a consequence, university real estate organisations seek to attain the organisational structure that is most beneficial for their organisation and the management of their real estate. The corporate real estate management process is based on matching real estate with organisational objectives and adding value to organisational performance. Previous studies have therefore focused on aligning corporate real estate management with the core business of an organisation. However, many studies do not focus on the impact of the organisation on the real estate management process. As a consequence, university real estate organisations lack the information and tools to assess whether their organisation optimally supports the real estate management process. As the university real estate management process has become more complex, and financial resources have become rather limited in the last two decades, the question of which organisational structure optimally support the management of university real estate is of high relevance. This urges the need for new information and tools to assess the relation between organisational structure and corporate real estate management. This study therefore explores how the organisational structure of university real estate departments influences the university real estate management process. The research objective is to provide university real estate organisations with a toolbox consisting of information and tools to support them in making decisions about the structuring of their organisation and the management of their real estate. The toolbox consists of three tools: (1) an analytical tool that determines the organisational structure of a university real estate organisation, (2) a model that assesses the university real estate management process, and (3) a model that determines which organisational structure is preferred based on specific conditions and priorities. Following the results of the study, it can be observed that different structural configurations do influence the university real estate management process. The organisational structure of the university real estate department can be determined by a set of five structural choices, which will create different structural configurations. To find the organisational configuration that supports the real estate management process, university real estate departments need to consider which added values they want to achieve. Added value can be created by: •aligning real estate with institutional goals (strategic) •aligning real estate with the primary process (functional) •aligning real estate financial value, risks and costs with the production of real estate products and services (financial) •maintaining the quality and quantity of current and future real estate (physical) In this study, the added value of real estate is assessed by linking the four Corporate Real Estate Management perspectives with the five development stages of Joroff et al. (1993). The development stage of the real estate department determines whether the real estate department’s behaviour and focus meets the university’s current needs, or simply put: it determines how and which added value is created by the real estate management process. To conclude, the organisational structure of the university real estate department influences the way university real estate is managed, as different structural configurations influence how the real estate adds value to organisational performance.