Technology is disrupting real estate. In recent years, there have been significant advancements in technologies and business innovations that improve – operations, overall customer experience, planning, governance, property development and value, etc.
Going forward, businesses and properties will be built increasingly on technology with advanced digital services competencies in data, IoT, analytics, in mobile, with AI and ML, personalization, leveraging internal and external systems, creating ecosystems, etc. With this, there is a much greater emphasis on – new services / products that are User centric to add value and increase stickiness, being more sophisticated in managing operations and risk, etc.
Basically it’s about extending the traditional real estate model based on glass, concrete and steel with new digital capabilities to be competitive or for advantage.
Technology Led Innovation in commercial real estate can be structured under four pillars –
1. Ecosystem Led Technovation – is about technology to build smarter buildings and cities to improve efficiency, sustainability and liveability, while also creating a transparent and better environment. This includes having a ‘ Property Smart Quotient ’ that can be used by all stakeholders (ie: owners, developers, property managers, tenants, government, etc.) for occupancy safety, having a positive impact on the environment, etc.
2. Product Led Technovation – Technology is playing a key role in new projects such as Smart Facilities Management Solutions with –
- contact tracing
- predictive cleaning
- space utilization monitoring
- air quality monitoring
- temperature / humidity monitoring
- smart parking
- asset monitoring
- retail footfall
- smart waste management
Further, products using drones are seeing impressive growth – especially as a tool for data capturing, processing, monitoring and delivering a better experience for tenants and real estate company employees. This includes real estate agents and property managers using drones for site walkthroughs, monitoring, building maintenance reviews (internal and external), marketing, etc., planners to scope projects or do property surveys, site managers to improve safety, etc.
3. Services Led Technovation – pertains to “ Proptech “ and “ Business Innovation “ in real estate to – improve operational efficiencies and effectiveness, expand business opportunities and revenue streams, have more ways to increase property appeal and value, etc. In addition to better managing properties, developers are increasingly adopting new and advanced construction technology and methods to save time and improve safety, using AI and VR for more accurate forecasting, and incorporating various technological tools in retail malls and the commercial office sector to better manage projects, deliver a better user experience, etc. Not surprisingly, because of COVID-19, there is an increasing investment in technology and automation to make the environment safer as well as address increasing business demands and user expectations.
4. Space Led Technovation – is about developing and operating smart buildings primarily through IoT. In conjunction with this, wearable technologies help prevent potential issues in business operations or during project construction. Another example is 3D printing helping up-skill the workforce in the construction industry while reducing construction costs. As well, with the increasing focus on sustainability, personnel well-being, increasing stickiness with tenants, automating processes, and to reduce costs – there are various sensor-based technologies for predictive maintenance / cleaning (see above). Because of the important benefits, the commercial office sector is adopting technology for a more efficient and sustainable workplace. For instance, with people returning to the office, workplace apps are evolving with insights on emerging business and technology trends plus changing regulations associated with personnel health and safety as well as updates on company policies, etc.
Conclusion
With the new normal including growing business requirements and rising personnel expectations as well as the impact of COVID, there is a greater need for real estate companies to –
- provide a very safe working environment
- deliver more value
- better address the needs of all stakeholders with relevant information quickly and easily
- adapt to the changing landscape
Those that are pro-active in addressing these demands will have opportunities.
Those that don’t will have many challenges.
If interested in exploring the options to improve outcomes in real estate, please contact JLL or CAIL.
July 16, 2020 by Arrumugham Shankar of JLL & CAIL Smart Building commentary info@cail.com