There is a striking philosophical difference between nonprofits and traditional office users: nonprofits are at their core mission-based. They exist to address a particular unmet and under-served need or to empower and organize a disparate group of people. They also typically operate with tight margins, limited budgets, and the unforgettable reality that every dollar spent on operations is a dollar not spent on serving their essential mission.
Real estate is not just the second-largest expense for most organizations, including nonprofits, it is a long-term commitment with a range of both risks and rewards. Occupancy decisions have a significant effect on any nonprofit’s core mission and program, and creativity in these decisions has become a mandate. This could mean considering options like a commercial condominium, or fully scrutinizing the wide range of tax incentives designated for specific cultural or community use. It can mean trying to cut costs, fit more into less space, or sacrifice on a desired location. Or, it could mean a exploring a new perspective on office space previously unacknowledged by many nonprofit organizations.
Leveraging the Workspace: A New Perspective
Despite budget and operating challenges, some nonprofits are seeking inspiration from for-profit corporations on their real estate decisions. While still seeking cost cutting opportunities and economies-of-scale strategies, savvy nonprofits use sophisticated workplace strategies as a means to please constituents, retain valued employees, attract new talent, and enhance their missions. This process draws from the physical environment— location, technology, amenities and office features— along with the guiding elements of the organization’s culture to achieve financial, operational, and business goals.
So… How Do We Begin?
Devising a comprehensive workplace strategy means first addressing several key considerations.
- What is your organization’s mission?
- How would you describe your organization’s culture?
- What are your primary sources of funding?
- Who are your constituents and do they need to access your space?
- How much space is too little? Too much?
- Is the space an appropriate representation of your brand?
- How important is proximity to transportation? What about to staff?
- Has employee recruitment and retention traditionally been a problem?
- Do you feel there is a need to improve your internal processes?
- Would/could you consider residing in a different location/neighborhood/submarket or even another state?
A thoughtful approach to these questions will lay the foundation for a successful real estate strategy. A strategy that not only allows a nonprofit organization to remain true to its mission, but to also effectively evolve as changes occur, both within the organization and the wider world.
Welcome to a whole new era. Deciding on an open plan versus a more sequestered space is now just as important to an operating strategy as selecting the right location. Thinking about the employees who live and breathe the organization’s mission is now just as important as pleasing the board members and reaching potential donors. Communicating the brand’s essence through the physical space is vital to nonprofits and we encourage you to embrace this change and the natural opportunity that lies alongside it.
Our nonprofit experts at Cushman & Wakefield can talk you and your organization through this process. We excel at managing this complex and evolving process, and are here to guide you through.