Corporations Implement Smart Growth Strategies

U.S. corporations are taking a more strategic approach to business growth as the economy continues to improve. Rather than expanding their real estate footprints in the near term, companies are creating flexible business growth plans while managing total occupancy costs and reducing risk, according to Jones Lang LaSalle’s 2011 Corporate Real Estate Survey.

“Companies in the United States are entering a growth mode in terms of hiring and business line expansion, but this may not translate to growth in office space needs to the same degree,” said Kenneth Rudy, international director of corporate solutions at JLL. “Even as they grow, companies are focused on strategies to maximize space utilization, both in the amount of space needed per employee and in the effectiveness of the space in driving a highly productive workforce.” In the recovering market, overall corporate productivity will hinge upon expanded output, improved quality and performance, and intelligent real estate decisions, Rudy added.

U.S. corporations also are looking to new global markets for high-growth opportunities. Survey respondents said the most effective expansion strategies will occur in markets outside of the U.S., particularly in Latin America and South America. Across the majority of Latin American office markets, strong economic growth is translating into healthy demand, especially in Brazil, where tenant demand is outpacing new supply in major markets.