The Importance of Technology for the Future of Real Estate

Covid-19 has propelled technology adoption five years forward in a very short time span. During an insightful webinar hosted by Client Care, we asked a select group of investor, occupier and developer clients to weigh in on how technology will transform the future of real estate

17 Sep 2020

By Li Ling Ng

Critical Facilities Decisions During a Pandemic
Covid-19 has propelled technology adoption five years forward in a very short time span[i]. During an insightful webinar hosted by Client Care, we asked a select group of investor, occupier and developer clients to weigh in on how technology will transform the future of real estate.

What is the future of the office?

Since the onset of Covid-19, digital transformation has become a top priority for companies. This is largely due to the mass adoption of remote working, which has prompted a rethink about the role of the office.

Remote working has shifted the mindset and culture of what is possible when social and travel restrictions are put in place. For example, mergers and acquisitions have taken place across continents without leaders leaving the confines of their home office.

In addition, the way that managers evaluate performance is changing, with less focus on presenteeism and greater emphasis on providing clear performance metrics. There are also more blurred boundaries between work and home life.

However, participants agreed that the physical office still provides many benefits – the irreplaceable factor of human connection for building teams, managing client relationships and onboarding new colleagues can never be fully replicated digitally. It is without doubt that hybrid working arrangements are here to stay.

Technology as a catalyst for change

During the discussion, one participant highlighted the important distinction between tech forwardness and digital forwardness. In other words, just because a company is in a technologically advanced country does not mean it is willing to adopt innovative digital solutions as part of its real estate strategy.

Nonetheless, smart buildings and tenant experience emerged as key areas of interest for investors, developers and occupiers alike.

As another participant observed, tenants are increasingly looking for building features that make their workplace experience more positive and productive. Technology plays a vital role in this, by enhancing tenant health and safety through measures such as thermal scanning and advanced sanitation systems. But in order to provide a truly holistic building experience, it is also key to anticipate the needs of employees and tenants.

However, it remains to be seen whether the benefits of smart buildings can be quantified in monetary terms, as one investor client pointed out. After all, how can one objectively measure happiness, wellness or productivity? From an investment perspective, this is a question that will keep coming up until tangible returns can be proven.

While the exact definition of a smart building is constantly evolving, the consensus among participants was that smart buildings should ideally combine technology with human elements of connectivity and wellness. For example, tenant experience apps enabling user access to amenities that enhance wellbeing and sense of community represent one of the many ways that technology will continue to be an integral part of the evolving real estate landscape.

Reshaping talent

So with Covid-19 rapidly transforming the way we work and live, what future skills will we need to adapt to this new normal?

Essential skills include adaptability, problem-solving, emotional intelligence and data literacy. In a world defined by constant change, we need to adopt agile learning and be comfortable with managing ambiguity.

And willingness to embrace technology is essential. Whether you are an investor, occupier or developer, it is clear that digital transformation is critical for long-term resilience. The future of real estate will be shaped by the technological trends that are emerging now.

Those that embrace this change, without losing sight of the human element, will be well poised to navigate this prolonged period of uncertainty.

[1] https://www.mckinsey.com/business-functions/mckinsey-digital/our-insights/the-covid-19-recovery-will-be-digital-a-plan-for-the-first-90-days#

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