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Paper eres2001_280:
Competent ownership in real estate business

id eres2001_280
authors Sneck, Timo
year 2001
title Competent ownership in real estate business
source 8th European Real Estate Society Conference (26-29 June 2001) Alicante, Spain
summary The real estate business–project Competent Ownership (Oskito)” focuses on the role of ownership within the real estate industry. Ownership acts as the core upon which , the competitive advantages of real estate industry are for the most based. The project studies specific real estate business issues, especially ”entities of possession” that are large enough to allow the development of specialised businesses. The project is of current interest as the next phase of growth of the Finnish information technology community is likely to primarily take place in areas remote of the very largest population centres. In the start up scenario Finland is a pilot community which is in the process developing second generation information society professions. During the next 10 years, a maximum of 250.000 of such jobs can be created. In Europe the figure will be several millions. In global exchange, someone is always ahead of the others, and Finland is likely to have advantge in this particular field. However, to achieve and maintain a globally leading information technology position is by no means an easy taska and there are several risks involved. The new know-how and expertise gained during the developing of the information technology society will be highly sought-after export material for some years. Soon, however, the same skills will be mastered elsewhere, too. The process of transmitting this knowhow will lead to the creation of considerable foreign part-ownership in Finland. After this period, around 2010, Finland will have to create new tasks and professions of value to the global community, as well as achieve competence in them. In real estate business, understanding the impact of growth centres on the industry is essential. The commercial and real estate strategies of the growth centres provide a course for the entire nation. It is no longer appropriate to speak of areas of growth, in the future Finland will be considered a singke global exchange entity. Many great challenges have to be faced during the transition period. Succesfully meeting these challenges requires areal commercial strategies supporting each other. The first task of the Oskito-project is to find out, how to create a sufficiently reliable vision of the future challenges. The second task is to develop real estate business so that the risks can be kept as manageable as possible. This requires active discussion concerning proper regional real estate strategies. For this purpose, an estimate of the development in the participating towns, up to the year 2010, will be made. An annual conclusion of the number of new jobs created and the consequent building will also be made. The building sites are to be classified according to their special features. As a result a project map, which each participating town updates annually, can be drawn. Companies, city real estate professionals and owners as well as the financers will be aware of the actual situation and able to maintain an accurate, long term regional real estate strategy. In the long run Finland can keep employment high only by investing in knowledge oriented growth clusters, eg. ITC and biotechnology. At the same time new patterns of uncentralized subcontract strategies must be adapted in the industry. As the result the change is huge. On the national level, 5-10 million floor square meters of new business premises has to be built. 10-20 % of people employed year 2010 need new buildings. The amount of this demand based scenario is so high that the real estate industry is unable to carry out concurrent planning, financing, training of new professional qualifications to the employees and create a sound basis for “competent ownership” in this rapid process. The resources invested in adult education are the balancing factor in this development. Regions build action plans to carry out “labour force transformation strategies” to maintain high employment. These transformation strategies must be included in th regional real estate strategies. The new kind of planning is approached in the OSKITO study by combining single, but important pieces needed to create new practices for the business. This is the best that can be done at this stage of the study. In Vaasa, for example, (population app. 60000, number of jobs app. 30000) the required yearly adult education is calculated to be 750 people, the existing capacity is only sufficient for 250 people per year. An increase in the capacity would, in 10 years, create the need to tehcnically improve 5000 work points in Vaasa. If the adult training is not carried out, the structural unemployment will easily be over 20 %. Wellcome to the new, brave second level on information society. Being one of the first nations on the way, small and transparent Finland can be used as the test laboratory for the other countries. An issue of great importance in regional real estate strategy is understanding the next generation products that are important to the region and to the business that evolves them. Anticipating actions in this context binds the region to the development of global exchange. In the Oskito project models are built to forecast the innovations behind the next generation products and to include these innovations as a part to future oriented adult education. This example shows how knowledge about profound issues should be produced to the persons functioning in real estate business. We are facing a research model that creates genuine new concepts and ways running a business. Concurrently with the research the participating towns test the proposals of the study. The research is financed by varied/diversified participants; a number of cities, real estate owners, financers and building firms. Therefore, it is easy to test the hypothesis in real busines during the research. It seems to be possible to develop the ”most intelligent way of owning” option for different real estate types. The function of the real estate strategy is to ensure, that the ownership of the real estates in the region is in the hands of the most competent operators. Only in this way it is possible to maintain the potential (or the high and sustainable employment) growth of large centres as a constant in an uncertain future. This project , with seven participating towns and a bugdet of 2,5 MFIM, is a part of REMBRAND-technology program.
series ERES:conference
content file.pdf (35,269 bytes)
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ratings
session Determinants of real estate growth
last changed 2009/07/10 18:07
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