We are all occupants of the building. We live in apartments that we rent and houses that we own. We work in offices leased by our companies and shop in retail stores. Different facilities are used in different ways, and we spend an estimated 90% of our time in them. So, why should we continue to accept space that frequently falls short of its full potential?
Real estate companies have started opting for different types of virtual platforms like accounting software for the enterprise. The COVID-19 pandemic has highlighted several flaws in the built environment, many of which are easily overlooked or simply accepted.
Is your office freezing? What to do- Purchase a sweater. Have you caught your coworker's cold? Why is it so because it's winter? What about that overpriced apartment near the subway? A necessary cost of convenience.
Crises frequently present opportunities for rethinking. They cause paradigm shifts that often result in long-term changes, and real estate is no exception. Mortgage lending standards became much stricter following the Global Financial Crisis.
Half bathrooms evolved from post-Spanish Flu entry-way sinks. Numerous resilience measures are being implemented in the aftermath of climate disasters, ranging from fireproof materials to stormproof windows. However, beyond resilience measures, the current crisis has raised concerns about how we use space and whether it fully meets our needs.
What Is Driving The Trends In The Sustainability Market?
Even outside of regulatory requirements, companies worldwide have spent the last few years making and keeping promises about sustainability. A shift in affordability is another factor driving the sustainability market trend.
While the technology to reduce carbon emissions was once thought to be prohibitively expensive, the cost of monitoring energy usage has steadily decreased over the last several years. In contrast, the cost of fossil fuels has only increased. While oil prices fluctuate, green energy technologies such as solar and wind are proving reliable.
The real estate industry is also beginning to feel the effects of sustainability requirements. Commercial real estate investors have started to include "green clauses" in their leases, which require owners and operators to benchmark and report on their energy consumption. Even though these clauses are currently available on a case-by-case basis, the trend of local and federal regulation points to a future in which reporting on building sustainability practices will be mandated by law.
Future viability: One thing is specific space needs to be improved. A Framework for the Future of Real Estate explains how. Future real estate should be:
Liveable: We should feel comfortable, productive, and healthy in buildings.
- Sustainable: This means net zero carbon and reduced emissions throughout the asset lifecycle.
- Resilient: This means buildings can withstand a range of both acute shocks and chronic, longer-term change.
- Affordable: This means a sufficient supply of accessible, quality space for housing and small and growing businesses.
If the real estate industry continues its current growth trajectory, it must evolve. Legislation and investor pressure are forcing change on sustainability, affordability, and resilience, while consumer demand is also hastening the adoption of more liveable and sustainable practices.
So, how exactly do we improve our spaces?
Utilize Technology
Design and construction innovation can aid in developing higher-quality, more affordable spaces. The use of digital twin technology has the potential to save millions of dollars in construction costs while also shortening project timelines and improving quality.
Lendlease used digital twin technology to cut the typical months-long design phase down to a few days, saving significant time and money. By leveraging digital infrastructure that provides insights into building performance, autonomous buildings can continuously learn, adapt, and respond to the needs of people and the environment.
Property technology can provide a more personalized experience for tenants, improving everything from air quality to meeting space booking.
Rethink Design
In a post-COVID world, neighborhoods, and spaces have become more fluid. Central business districts that are predominantly office-based must evolve into more mixed-use destinations.
To compensate for declining revenues, cities need to be more creative with public space, potentially monetizing some of its use and repurposing it for different purposes, such as outdoor gyms or pop-up galleries. If workers have remote options, offices must encourage more collaboration, which means more places to gather with colleagues effectively.
Homes will be places for both work and play, and possibly even primary residences for multiple generations, necessitating design evolution to accommodate distinct uses and users better.
Community Engagement
For far too long, financial returns have trumped community and tenant needs. Working across industry silos and understanding stakeholders will improve the provision of inclusive, accessible, and liveable space.
The rise of NIMBY ("not in my backyard") demonstrates what can happen when projects do not provide sufficient benefits to all parties involved. With a greater emphasis on ESG (environmental, social, and corporate governance), focusing on benefits other than purely financial returns will help solidify this rebalancing.
Commercial Real Estate CRM can help enhance the sustainability of the environment by allowing you to view details from anywhere with internet connectivity.
Conclusion
For far too long, we have accepted the state of our built environment: capital-intensive assets with long time horizons and little flexibility. But now is the time to ask for more. It is past time for space to assist us in living healthier, more productive, and connected lives.
