I manage properties for an NHS foundation trust. How can I manage my estate more efficiently so I can make savings?

Mike Bothamley, head of the real estate sector at law firm Beachcroft, responds:

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There are a range of possible options open to you: some strategic and some operational.

First, at the strategic end, there are huge changes coming. Foundation trusts (FTs) are likely to emerge as major consolidators of primary care trust (PCT) provider arms following the commissioner/provider split. Policy dynamics coupled with funding shortages are likely to bring together local authority and PCT procurement functions.

Depending on the outcome of the next election, there will be more or less development of free markets for service provision. There may be movement on the private patient cap.

Boards will grapple with these and other issues and, as strategic clarity emerges, estates managers will need to respond by helping to define what real estate will be mission critical to service delivery, what can be outsourced and what can be disposed of. The frustration will be waiting for clear operational objectives to emerge from the maelstrom of change.

Once service models are clear and what is required in terms of buildings can be specified, third party involvement can be considered and a real possibility would be to use LIFTcos.

The critical objective will be to find a real estate service provider that is really focused on driving utilisation and on achieving the same objectives as the FT. In some cases the emphasis is likely to be on finding flexible premises capable of being put to a number of uses. The trick will be to find partners who are able to deliver effective provider-led solutions, as opposed to property companies who are just interested in collecting rent.

Estates managers also need to be clear whether real estate assets are part of the strategic estate or not. Again, the necessary strategic clarity to make those judgements may not always be there. Where it is, estates managers need to focus on the strategic estate and identify how best to maximise value from the rest.

At an operational level, few FTs are maximising revenue. A fairly simple but time consuming effort to marshal information, regularise all third party occupancies and maximise collection of rent and service charge could make a considerable improvement to revenue generation.

A final point to be mindful of is the proposed phase out of hospital car parking charges for a significant proportion of patients, which it is said will cost NHS organisations up to £140m a year. Other options currently being considered, such as making all parking free, could cost up to £180m a year. It is believed such a measure would primarily affect acute hospitals, 94% of which charge for parking.

FTs should be aware that this important revenue stream is likely to disappear over the next three years, and therefore it shouldn’t be relied upon too heavily.

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