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A new, leaner era is underway across state and local governments.

​Government executives are up against enormous pressures. Looming pension liabilities, possible federal funding cuts and potential negative press if expensive real estate is mismanaged.

In response, leaders—many with private-sector experience—are finding new ways for buildings to serve constituents more effectively. And, reducing spend to help avoid cutting critical services or staff.

They’re turning property—formerly a liability and cost center—into an opportunity to streamline and serve.

How? Solution vary from state to state, and community to community. But, there are eight common strategies forward-looking state and local governments are using to help solve their most profound and urgent challenges:

Enlist champions for change

Let’s be honest. Particularly in government, change is hard. That’s why it’s crucial to strategically gather support for your plan before rolling it out.

As the change agent, you should act early to enlist passionate advocates to stand by your side. These powerful and knowledgeable individuals will be key to advancing the changes you propose, and can also help you anticipate obstacles along the way.

Earn a seat at the strategic planning table using real estate information

Bring clarity to a complex portfolio with multiple sites and building types. In most governments, facilities are centrally owned and managed or leased by individual agencies and departments. Putting a centralized data management system in place helps you see the big picture.

How? Predictive analytics will assess your current state, and correlate your future real estate needs with projected headcount growth or reductions.

Clarify and unify real estate portfolio management

For many governments, real estate is managed by multiple entities. Aggregating real estate information across your entire jurisdiction empowers you to:

  • Negotiate volume discounts for supplies
  • Offer consistent benchmarking guidance and standards to educational institutions and agencies—without threatening their autonomy
  • Provide a consistent level of service and quality to all end users

Prioritize real estate user satisfaction and communication

Trying to attract and retain millennial employees? Make your constituents feel supported?

Focusing on your employees and constituents can infuse a sense of purpose throughout real estate decision-making, from interior office build-outs, to lease versus sale decisions.

Measure end-user satisfaction with surveys and metrics. Establish key performance indicators like response time for service requests, task completion or satisfaction with the workspace.

Tackle deferred maintenance and improve the capital planning process

To avoid ballooning deferred maintenance costs, some state and local agencies are adopting a more strategic approach to capital planning. They’re performing regular facilities assessments and employing consistent, year-over-year methods to assess and prioritize capital projects.

Align contracts with service provider compensation

Vendor contracts can be an enormous pain point with employees, constituents and the media. They spur talk of mass layoffs, government waste on “expensive consultants,” and more.

One emerging strategy to combat these scenarios: pay-for-performance contracts. The key is to jointly identify achievable outcomes and key performance indicators. Then define them in a contract that stipulates a base fees plus fees-at-risk for achieving target goals.

Tap investor capital using P3s to finance ambitious projects

When public sector budgets are tight, the private sector can be tapped for funding, via public-private partnerships (P3s). P3s have been used for decades for infrastructure and highway development, and are gaining popularity with state and local agencies to finance real estate projects.

When thoughtfully executed, P3s can reduce the need for public debt while also supporting a valuable community project, boosting economic growth and creating local jobs.

Establish a strong governance program

Whatever your initiative, a strong governance program is essential. It will ensure that established goals are consistently monitored, and unexpected obstacles are proactively addressed. Regular meetings and reporting mechanisms ensure key decision-makers are always kept in the loop and have opportunities to give feedback and direction.

​Learn more about all these solutions, and see how some governments have successfully employed them.

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