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NASCA Releases New Research on Transforming a State's Real Estate Portfolio

Tuesday, July 13, 2021

The Workforce of the Future Will Require State Government Leaders to Think Differently About Real Estate, According to New Report from NASCA and JLL

NASCA Provides a Road Map for States Thinking Different About their Real Estate

LEXINGTON, Ky — As U.S. state governments face growing challenges attracting talent and reducing costs, most states are shifting to adopt some form of hybrid work as a permanent component of their workforce strategy, according to new research from the National Association of State Chief Administrators (NASCA) in collaboration with JLL.

Based on interviews of twenty-three (23) chief administrators for this report, most states interviewed are rethinking their real estate portfolio strategies because of COVID-19; however most states are in the initial stages of rethinking their real estate portfolio strategies. 

Given the magnitude and complexity of these changes, the research identified five success factors and ten steps state leaders can take to transform their workplace into a fluid model where employees are empowered to work from anywhere, be it the home, office, or other locations. 

"Portfolio optimization is not just about reducing space or assessing space based on costs," said Herman Bulls, Vice Chairman and Founder of JLL's Public Institutions industry practice. "State leaders will need to examine how the built environment adds taxpayer value and invest in the footprint that enhances productively and supports future workforce needs. By understanding the work that is performed and workforce expectations, a State can develop workplace strategies that empower people to do their best work, while respecting diversity and work-life balance." 

State leaders must take an intentional approach to portfolio management. The following five factors were cited by the states as the most critical to a successful implementation of workplace and portfolio changes. 

 

  • Centralized real estate models are more likely to have coordinated policies across state government. To implement change with decentralized models, CAOs have created pilots in their own agencies to demonstrate the effectiveness of hybrid work and flexible work environments.
  • All States interviewed felt executive support from the governor's office is instrumental to implement broad-based changes to workplace and portfolio strategy.
  • Nearly all states considering implementing a hybrid work model are also considering investing in occupancy planning tools.
  • States with explicit sustainability goals are more likely to implement hybrid work as a strategy to mitigate greenhouse gas emissions.
  • Talent recruitment in government can be challenged by competition from the private sector, but hybrid work arrangements can be used to attract and retain top talent from across the state.
"As states' workforce strategies, technology solutions and real estate portfolios have become more interdependent than ever before, state chief administrative officers (CAOs) are uniquely positioned to play a significant role in transforming the way state governments provide services." Said Jason Jackson, Director of the Department of Administrative Services and Chief HR Officer for the State of Nebraska and Chair of NASCA's Research Committee, the state-led governing body that guided the national research. 

 

"Real estate optimization requires balancing workforce, real estate, technology, budget, and leadership. While there is not one-size-fits-all solution for all our states, this research provides a road map to give state governments and public organizations a range of effective and efficient options that balance unique factors in their respective states."

The report includes examples from a number of states with ambitious initiatives to rethink government operations including Colorado, Oregon, Michigan, Massachusetts, Tennessee, Nebraska, and Utah. 

Visit www.nasca.org/publications to read the full report.

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About the Report
To provide national trends and relevant and actionable insights for NASCA state members, JLL and NASCA interviewed 23 state chief administrators and/ or their real estate leadership. The interview questions drew from subject-matter experts on real estate and facilities management. NASCA convened the Research Committee, a working group of members who are chief administrative officers (CAOs) to vet the questions, analysis, and recommendations.

About NASCA

The National Association of State Chief Administrators (NASCA) is the leading organization advancing professional development and best management solutions for the administrative functions of state government. The association provides state chief administrators with the opportunity to increase their knowledge of state government administration through education, networking and information exchange on state government trends, leading edge innovations, standards and best practices.

NASCA's mission is to help state chief administrators and their teams strategically transform state government operations through the power of shared knowledge and thought leadership.

About JLL

JLL (NYSE: JLL) is a leading professional services firm that specializes in real estate and investment management. JLL shapes the future of real estate for a better world by using the most advanced technology to create rewarding opportunities, amazing spaces and sustainable real estate solutions for our clients, our people and our communities. JLL is a Fortune 500 company with annual revenue of $16.6 billion in 2020, operations in over 80 countries and a global workforce of more than 91,000 as of March 31, 2021. JLL is the brand name, and a registered trademark, of Jones Lang LaSalle Incorporated. For further information, visit jll.com.