Real estate can account for up to 15 percent of total operating expenses for many companies. Yet a study of real-estate-management practices shows that a significant number of corporations fail to control their occupancy cost—though opportunities for savings abound.

Despite the trillions of dollars real estate consumes, we found that for most companies this area is chronically undermanaged, to the extent that basic business tools—guidelines for when to acquire new space, whether to buy or lease, and how much to spend—are frequently absent. In fact, many corporations actually outsource these vital decisions or assign employees to deal with them only on a part-time basis. The result is often a patchwork of excess locations and costs.

The companies most adept at real-estate management, our study found, assign employees with skills in property, finance, legal, and workplace design to manage corporate real estate on a full-time basis. Even with clear guidelines and best practices, many companies still fall short when deciding how much to spend on occupancy and how to manage real-estate portfolios. Two measures can help improve management and control costs.

First, companies should use a broader definition of occupancy cost than just rent, since the failure to account for operating...