Are real estate organisations adapting to the digital age? The recent ULI Tech Forum debate led by Tim Stonor, Managing Director, Space Syntax explored this question with views from four leading organisations and a multi-disciplinary audience, highlighting common barriers, key trends and processes that real estate could adopt be meet this new era.

A robot called Nau was meant to launch the evening presentation but sadly fell over and subsequently sat throughout the forum blinking at the audience with its engaging eyes. Fittingly this highlighted that some technology is fallible and human capital plays a fundamental role in the management of real estate, however this may change in the future.

Adam Burstow, Grosvenor’s Group IT Director shared an insightful presentation into Grosvenor’s global digital journey, which began in 2012 when the term digital was still being defined and by 2014 transformed from an IT strategy to a digital strategy.  A historical perspective of innovation across Grosvenor’s 339year history highlighted that the digital era is only just emerging but it will bring a new dimension to the organisation as it intersects across all segments of the organisation and its corporate approach. Digitisation at Grosvenor is very much an evolving process that recognises innovative technology trends but also addresses the influences innovation will have on the organisations culture and longer term future. Adam’s presentation can be viewed here: Hi Robot – Adam Burstow’s Presentation.

The subsequent panel debate which included Sophie Ross, Head of Multichannel, Hammerson; Jill Ju, Investment Director, Greystar and Alex Edds, Director of Innovation, JLL all shared Adam’s view that real estate organisations are still adapting to the digital age and incorporating a digital approach interlinks with an organisations culture.

Key learnings from the debate included:

• Real Estate is highly risk adverse and could be more adaptive to support digital innovation
• Strategies should meet customer expectations and aim to deliver great user experiences
• Costs of adaptation can be significant when considering the true impact on an organisations structure
• Don’t apply tech for the sake of it – consider the end user and long-term outcomes
• We spend more time collecting data than managing data – innovative platforms are rising meet this opportunity
• A lack of data scientist in real estate may limit organisations from realising the true benefits of digitisation
• A lack of connections between building ownership, operation and occupation is limiting digital adaptation

Digital innovation is challenging the traditional concept of investment in bricks and mortar, as new value propositions are emerging that allow for deeper or even real-time oppurtinities that are currently not realised. Significant risks and opportunities exist for early adopters however some forms of digital innovation still need to mature to realise their true market value or realisation of un-intended consequences.

Market limitations such as lease lengths and asset management structures were highlighted as current barriers to regular adoption of digital innovation. As lease terms reduce as they have over the last decade it is likely digital adaptation will align more with digital trends, however the wider industry could still do more to allow for innovation to thrive. Further views on how real estate could further support the adoption of digital innovation included:

• Creating a culture that foster ideas from across an organisation
• Engage with communities, from both real estate and non-traditional sectors to track the market to ensure a readiness to adapt

An intriguing question was raised that asked the audience and panel if a perfect building is one that lasts a trend of a few years or one that lasts a century? Interestingly in terms of sustainability and current construction capabilities it could be more beneficial to allow for a shorter life span of a building. Consideration should be given to the fundamental purpose and function of a building within the context of its long-term community value.

This forum highlighted we could be witnessing a long-term cultural shift away from traditional real estate’ and business functions as a result of digital innovation and transparency.   How real estate and cities adapt to this paradigm is yet to be discovered and concern around ‘disruption’ persists. Close collaboration and knowledge sharing with innivative tech firms should be considered to ensure risks are mitigated and lasting benefits for our urban realm are realised.

Our next Tech Forum will be on the 17^th January and will focus on how Tech firms are challenged or enabled by real estate.

A special thank you to Grosvenor for hosting the Digital Journey: Tech Forum.