Listed property companies unlock benefits of customer service, says EPRA study
Property owners are increasingly recognising the benefits to be gained from working closely with their tenants, replacing a sometimes more remote and confrontational relationship with a business model that focuses on the needs of customers, a study commissioned by the European Public Real Estate Association (EPRA) shows.
EPRA director Gareth Lewis (pictured) says: “Listed companies are leading a mini-revolution in the world of commercial real estate, with the growth of a customer-focused approach to property management, embracing more active engagement with tenants, product innovation and flexibility of service. They are driven by an increasing focus on protecting and enhancing regular returns from rental income and recognise the benefits accruing to the bottom line from providing superior accommodation services and so securing better tenant retention. With this research, we have for the first time been able to identify and quantify the extent to which European listed property companies are focused on their customers’ needs and addressing what RealService calls the 3 R’s of real estate – revenue, retention and reputation.”
Real estate customer service specialists RealService conducted the study “European Listed Property Companies - Progress Towards Customer Focus” for EPRA. Data published by the top 50 listed property companies and Reits in Europe was used to measure customer focus levels at each of the companies studied.
Some 43 of the 50 largest property companies (86 per cent) have embraced the customer (tenant)-focused approach to property ownership and management to some degree.
Significant progress has been achieved by 13 companies (26 per cent), 12 (24 per cent) have made material progress and a further 36 per cent have begun to take their first steps in this direction.
The remaining seven (14 per cent) companies identify their primary focus as being on the investor.
Innovation has been led by companies in Scandinavia and the UK, but evidence of increased customer focus can be seen growing across Europe.
The degree of customer focus is unrelated to market capitalisation.
Diversified property companies and office-sector specialists tend to be more occupier-focused in their statements, while retail sector specialists are more consumer-focused.
Howard Morgan, RealService managing director, says: “Our research identifies that the listed sector is changing its focus and adopting customer-focused language in its corporate strategies and public statements. The next opportunity for this research is to look at the impact of these strategies on business performance. This will require agreement on a standard basis for measurement and reporting of service performance. We look forward to working with EPRA members to take this forward.”