Office facilities planning considering organizational constraints

Given insufficient capacity at a firm’s existing office facility to accommodate all organizations, a decision is required of which organizations to be relocated to one or more new sites, or to divest the existing facility and relocate all organizations to one or more new sites. Under these circumstances, consideration should be given not only to new construction cost, but also annual facility operating costs, organizational fragmentation and dependencies, potential rental income, and the market value of the existing facility. This paper presents a nonlinear mixed-integer programming model to optimize site selection, facility size, and organizational assignment to minimize total annual discounted costs. An example problem is formulated and solved using a transformed linear model with conventional software. Further extensions of the model are also discussed for application.