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93% of Chinese companies expect to grow domestic real estate portfolios in 2012; 15% anticipate international expansion

Business growth and cost control driving corporate real estate strategies according to Jones Lang LaSalle’s inaugural survey of Chinese corporations


SINGAPORE, 11 July 2012 – A new survey from Jones Lang LaSalle shows that Chinese firms are increasingly embedding corporate real estate (CRE) strategies into their businesses and embracing outsourcing, mirroring overseas trends in response to organic growth, M&A activity and cost pressures.

 
Key findings from the survey, ‘The Dragon is Stirring’:

 
• The most influential factors shaping CRE strategies in China are cost pressure (53%) and organic growth (47%)
• 93% of firms expect to grow their real estate portfolio in China, and 15% of those also anticipate international expansion
• Where present abroad, 13% have a foothold in South East Asia (16% targeting), 11% are in Australia and North America (13% and 19% targeting respectively) and 13% are targeting Europe
• Future location decisions in China will be driven by business criteria (50%), incentives (42%) and costs (38%)
• More than half (53%) are considering strategies that enable mobile working to increase productivity and improve workspace utilisation (50%) and to attract and retain talent (32%)
• We will see a dramatic shift toward outsourcing – 70% are considering adopting a mix of in-house and outsourced CRE delivery within three years; a further 10% are considering fully outsourced delivery from none in 2011
• CRE structures are gradually transforming – a quarter of firms surveyed have established a dedicated CRE department and more than half have a CRE strategy in place today



John Forrest, CEO of Corporate Solutions, Asia Pacific at Jones Lang LaSalle said: “Large Chinese corporations are recognising that strategic real estate management can positively impact their business productivity, from cost control to employee satisfaction and brand image. Domestic and overseas expansion plans are the most powerful drivers shaping CRE structures and strategies. Looking ahead we expect to see CRE play an increasingly pivotal role as more Chinese firms will have strategies in place, more will have dedicated CRE teams and the C-suite will engage further.”

 
Notes to editors
1. Download the full report (including survey details)
2. Download infographic