Thomas Frank

Wednesday, 23 March 2005 09:26

Through the looking glass

Three primary drivers of change will affect how office space is designed, built and used in the future -- demographics, productivity, and technology. Each will affect the changing dynamics in demand and use of office space locally, regionally and globally with respect to where office space is built for front-office and back-office workers alike.


Sluggish employment growth and an aging work force will soften the demand for new office buildings in many markets. Oversupply of office space in most markets will keep rents lower than needed to support new office buildings built at increasingly higher costs.

Routine jobs will be outsourced, off-shored or computerized, all of which will have a negative impact on demand for additional office space.

The effects of technology

Technology is allowing workers to become more mobile and flexible, so more workers in the future will use virtual offices, working in satellite offices and at home with connectivity, thus reducing the dependence on large offices for workers to go each day.

Office space per worker is and will continue to decrease, saving businesses money. Companies will strive to become more flexible with their use of office space, which equates to real estate savings and fewer square feet needed to support core operations.

The changing work process

Office space trends will continue to change how and where businesses choose their space to support their workers. Changing office space trends will present both challenges and opportunities for office space developers and managers, and for real estate services firms, which represent tenant-users, all of which must become more solution-oriented.

The back office was originally a central space through which transactions flowed from department to department and/or desk to desk until all relevant information was compiled and all processing tasks were completed. Microcomputers, in conjunction with mainframe computers, have completely transformed this process.

By defining a transaction by product line, one individual -- via a microcomputer with access to a database -- can gather and process the information necessary to complete a transaction. Where it once took numerous employees and multiple processing steps over a period of days to complete a routine process, it now takes one individual less than a day to receive, issue and complete important tasks to support business operations -- all via a terminal that is fully online to a minicomputer-based system.

Thus, the work process has been decentralized according to product line, but information previously spread throughout the organization has been centralized within information process centers.

Back-office locational patterns

At the same time that telecommunications technologies have enhanced the capacity to move information in, through and out of central-city office buildings, they have also been a permissive, although not a deterministic factor in the decentralization of back-office facilities. Trends in back-office location demonstrate that their location depends on factors that are essentially a function of three dynamics -- the size of an establishment, the economic dynamics of city and suburban locations, and organizational determinants.

As there are a number of factors that affect each dynamic, and the importance of these factors differs from city to city and firm to firm, the extent of decentralization of back offices varies considerably among industries and cities. A review of each dynamic and the major factors that influence it will show that future trends in back-office location will depend on the ability of different areas to effectively meet the dynamic demands of back-office facilities.

One thing is for sure -- for the office space developer, manager, service provider and particularly the end user, the future promises to be exciting as trends continue to change how office space is utilized.

Thomas W. Frank, SIOR, CCIM, is a co-founder of Summit Realty Group and a 30-year veteran of the real estate industry. He specializes in corporate real estate services, tenant representation and office space advisory services. Frank has been involved in more than 1,000 transactions, handling more than 5 million square feet for tenants and buyers of commercial real estate. He also serves as Summit's director of office services. Reach him at (317) 713-2104 or

Friday, 16 July 2004 09:55

Recognizing professionalism

Only the very best brokers in the real estate industry seek and qualify for designations, professional symbols held by brokers who demonstrate the highest level of knowledge, experience, production and ethics in their respective commercial real estate practice specialties. The most prestigious designations are only earned by the very best practitioners in the industry.

The National Association of Realtors and its affiliates offer and grant more than a dozen specialty designations, but two stand out as the most prestigious and highly regarded in the commercial real estate industry.

Society of Industrial and Office Realtors (SIOR) is a leading professional commercial and industrial real estate association. The society represents today's most knowledgeable, experienced and successful commercial real estate brokerage specialists.

The SIOR network includes more than 2,900 members in 480 cities in 20 countries on six continents. The society has certified almost 2,300 of its members with the prestigious SIOR designation. Designees specialize in industrial, office, sales manager, executive manager or advisory services categories.

The society also includes associate members who include corporate executives, developers, educators and others involved in the commercial real estate industry.

Clients represented by an SIOR designee receive an extraordinary level of service. The average SIOR possesses 20 years as a professional, has completed an intensive curriculum of SIOR courses and has demonstrated extensive experience by closing a very high volume of sales and lease transactions.

As evidence of society member experience and expertise, society members reported an average person dollar volume of $25 million in closed transactions. As a group, society members closed more than 68,0000 transactions in 2003, averaging 34 transactions per member. Society members leased or sold an average of 1.2 million square feet of space per member in 2003.

A Certified Commercial Investment Member (CCIM) is a recognized expert in the disciplines of commercial and investment real estate. A CCIM is an invaluable resource to the commercial real estate owner, investor and user, and is among an elite corps of 7,500 professionals across North America who hold the CCIM designation.

Only 6 percent of the estimated 125,000 commercial real estate practitioners nationwide hold the CCIM designation, which not only reflects the caliber of the program, but also shows why it is one of the most coveted and respected designations in the industry.

Conferred by the CCIM Institute, the CCIM designation was established in 1969. Courses leading to the designation are offered throughout the world. CCIM members are in more marketplaces in North America -- 12 CCIM regions representing 1,000 cities -- than all major real estate companies combined.

The CCIM movement began more than 40 years ago with commercial real estate practitioners who wanted to elevate their business practices through education and networking. Then, and now, education and networking remain the cornerstones of the CCIM designation and the reason for its success.

Of the many professional designations conferred to members of the National Association of Realtors, the SIOR and CCIM designations stand out as the most prestigious. Clients who demand the highest level of service choose practitioners who hold the SIOR and CCIM designations.

For more information regarding the SIOR and CCIM designations, and the many resources provided by each, go to and

Thomas W. Frank, SIOR, CCIM, is a co-founder of Summit Realty Group and a 30-year veteran of the real estate industry. He specializes in corporate real estate services, tenant representation and office space advisory services. Frank has been involved in more than 1,000 transactions, handling more than 5 million square feet for tenants and buyers of commercial real estate. He also serves as Summit's Director of Office Services. Reach him at (317) 713-2104 or