The characteristics of real estate assets management practice in the Malaysian Federal Government

Abstract

PurposeThe management of public real estate assets by government agencies has been in place for many years as government agencies own their real estate assets in order to provide services to their communities. The management process becomes progressively complex and difficult because real estate ownership by agencies increases in amount, value and diversity over time. The purpose of this paper is to explore the current characteristics of the real estate management practice that is being implemented by the Malaysian Government agencies.Design/methodology/approachA qualitative approach has been used for this study where the data were collected through the use of interviews. The respondents to the study were government officers who execute real estate management functions within the ministries. The collected data were subsequently analyzed through the framework analysis method.FindingsThe results have shown that eight characteristics can be used to illustrate how the government's real estate assets are managed by the agencies. The characteristics include ad hoc management, a reactive approach, stages of implementation based on property life cycle, more focus on the maintenance management function, management by insufficient and non‐expert staff, management by fragmented departments, lack of information management systems and lack of performance measurement.Practical implicationsMost of these characteristics proved that the practice of real estate management by government agencies is not being carried out efficiently and is unsystematic. Therefore, the Malaysian Federal Government should plan, design and implement a strategic approach to ensure all the negative characteristics are eliminated because, if left unattended, this practice is bound to produce increasingly negative impacts over time.Originality/valueThis paper exposes the status of real estate management practice being implemented by the Malaysian Federal Government agencies. The findings will allow the federal government to determine the advantages and disadvantages of its real estate management operations and could be used to evaluate the capabilities of its agencies. The research output may also be utilized as a reference point by other countries with similar governance structures to assist in improving their public sector real estate management processes.

Real estate management: incentives for effort

“…Then what motivates the individual real estate manager to perform in the complexity of tasks as described by Abdullah et al (2011)? One of the real estate managers stated above that for him as a consultant he needed to outperform every day so that the real estate owner did not want to change service partner.…”

“…The interviews were based on five themes, as elaborated below. These themes were based on the previous research results of Abdullah et al, 2011, Azasu, 2009, and Ellingsen and Johannesson, 2008.…”

“…From the literature (Abdullah et al, 2011), the tasks that the real estate manger are to be performed. But what level of mandate does the individual real estate manager have to perform these tasks?…”

Information for decision-making in in-house and outsourced real estate management organisations

“…The questions regarding the decisions dealt with by the decision maker relates to what Abdullah et al (2011) categorise as long-term objectives. It is, more or less, the objectives of long-term strategic decisions to optimise property value and to decide to invest, purchase or sell a property.…”

Strategies in real estate management: two strategic pathways

“…Loh (1991) and Wurtzebach et al (1994) also include that the dimension of the real estate manager is to maximize returns by increasing rental income. These goals are divided by Abdullah et al (2011) into two categories: short-and long-term objectives. The fulfilment of short-term objectives (like the task of maintenance, rent reviews, leasing, and customer relations) is a requirement that need to be fulfilled prior to ensuring long-term objectives (like increasing investment returns, optimizing property usage, and prolonging the functional life) are fully met.…”