Introduction Over the past five years, a number of authors (Andersen, 1993; Bell, 1991; Joroff, Louargand, Lambert, and Becker, 1993; Lambert, Poteete and Waltch, 1995; Manning and Roulac, 1996; Nourse, 1992; Nourse and Roulac, 1993) have extolled the advantages of companies managing their corporate real estate proactively as an integrated part of their company’s overall strategic plan to gain a competitive advantage in their industry. Concurrently, the issue of how much and which corporate real estate functions should be outsourced has also been discussed (Apgar, 1995; Bell, 1991; Bergsman, 1994; Carn, Black and Rabianski, 1996; Collins, 1995; Kimbler and Rutherford, 1993; Lambert et al., 1995; Lucchese, 1996; Manning and Roulac, 1996; Rodriguez and Sirmans, 1996; Silverman, 1995; Walton, 1993) in the literature. Even though it was brought to light fifteen years ago, that 25% or more of corporate assets were in real property, and occupancy costs of corporate space represented 40% to 50% of their net operating income (Rodriguez and Sirmans, 1996, p. 13; Nourse and Roulac, 1993, p. 475), many companies have continued to claim that “they are not in the real estate business.” As recently as 1995, Lee Dayton, general manager of real estate for IBM, was quoted (Silverman, 1995) as saying “We’re in the information systems business, not the real estate business.” Such statements are only true from a very narrow perspective. From a broader perspective, such thinking is not only naive, but also JOURNAL OF REAL ESTATE RESEARCH 1 259 Chris Manning* Mauricio Rodriguez** Stephen E. Roulac*** Which Corporate Real Estate Management Functions Should be Outsourced? † † 1997 Corporate Real Estate award, sponsored by the National Association of Corporate Real Estate Executives International (NACORE). *Department of Finance and Computer Information Systems, Loyola Marymount University, Los Angeles, California 90045. **M. J. Neeley School of Business, Texas Christian University, Fort Worth, Texas 76129. ***The Roulac Group, 900 Larkspur Landing Circle, Suite 125, Larkspur, California 94939. Abstract. Recently there has been much interest in outsourcing corporate real estate management functions. We explain why firms should consider outsourcing and identify both positive benefits and possible negative consequences of outsourcing. Further, we utilize concepts from the neoclassical theory of the firm, supported by the literature on corporate real estate outsourcing, to shed some light on how much and which corporate real estate management functions should be outsourced. Functions associated with “taskmasters,” “controllers,” and “dealmakers” are more likely to be outsourced successfully. “Intrepreneur” and “business strategist” management functions are more likely to be carried out more effectively by internal managers. Outsourcing the appropriate real estate management functions, consistent with each company’s individual needs, should enhance shareholder wealth.