How to juggle competing priorities for capital dollars was a common topic among participants from corporate, education, government and healthcare sectors. Organizations maintain an average backlog of $37 per square foot in deferred facility maintenance, while spending an average of only $6.19 per square foot, underscoring the need for careful prioritization of limited capital dollars. Increasing construction costs – of two percent per month in some markets – were another factor forcing organizations to reprioritize projects as available funds diminish.

“Identifying which capital projects will provide the greatest value can be a complex process given the multiple stakeholders involved in the decision and the many dynamic factors at play,” said Ray Dufresne, Vice President of Consulting Services at VFA. “Organizations are increasingly looking to implement more formal processes and more sophisticated software tools to allow them to make better-informed decisions about capital priorities.”

Energy management remained a key issue among facilities professionals at this year’s conference, many of whom have implemented energy efficiency and cost reduction programs in their organizations. In a recent customer survey, 94 percent of VFA customers rated energy management as an important concern. Energy prices in commercial buildings have climbed from $1.21 per square foot in 1999 to $1.41 in 2003 and reached $1.50 in 2005.

Sustainability emerged as an increasingly important focus, going beyond energy efficiency to address “green” building practices. Sustainability was a focus of the keynote address by Sheila Sheridan, CFM, CPM, Vice Chair of the U.S. Green Building Council“s committee on Leadership in Energy and Environmental Design for Existing Buildings (LEED-EB).

“Energy efficiency and sustainability programs offer tremendous promise for significant cost-savings. However, the burden has been put upon the facility manager to deliver on these promises all while under the watchful eye of the CFO or executive team,” said said Sheridan, a former Chair of the International Facility Management Association (IFMA). “VFA solutions are powerful tools to help organizations to determine both where to focus capital improvements for energy savings so that they yield the greatest long-term results, and where to bundle such projects with other capital improvement initiatives for the greatest efficiency.”

Sheridan also emphasized the need to develop the next generation of facilities professionals, who require new skill sets as the role of facilities planning and management has expanded in scope and gained greater strategic importance. The need for superior executive communications skills, knowledge of technology and financial expertise were some of the traits noted by participants as important to the modern day facilities professional.

“At Mercy, we view capital management as a key strategic enabler to the success of the organization,” noted Hector Boirie, Chief Capital Management Officer at Sisters of Mercy Health System, a $3.7 billion multi-hospital system headquartered in St. Louis. In his presentation on promoting efficiency and accountability in managing capital spending, Boirie encouraged participants to think of capital management in strategic rather than transactional terms, and to develop an organization with competent individuals and processes that provide a business edge in a demanding industry.

“More and more organizations are implementing processes and systems that enable the alignment of facility capital investments with overall business strategy,” noted Jerry Kokos, President and CEO of VFA. “VFA’s growth over the past year, as well as the record attendance at this year’s VFA Connections conference, are both a testament to that fact. Organizations want greater insight into the long-term impact of capital programs, both in terms of cost and in terms of their ability to support the organizational mission.”

About VFA
Headquartered in Boston, VFA, Inc. is the leading provider of end–to–end solutions for facilities capital planning and asset management. VFA’s Capital Planning and Management Solution (CPMS™) uniquely combines facility assessment services, Web-based software, and business consulting services to enable clients to manage every stage of the capital asset lifecycle—from requirements gathering and long-term planning to capital budget creation and spend management. VFA has helped over 300 organizations in corporate, education, government and healthcare markets to strategically manage more than two billion square feet of real estate. For more information, please call 800-693-3132 or visit http://www.vfa.com.