In there cent years, the world has seen a lot of inventions and innovations globally. The new technology and innovation has a great impact on every sector of commercial real estate ranging from offices, industrial and retail businesses.
Innovation is not biased. There as on some industries are more innovative than others is for reasons such as;
Timing: Some Industries have seen much development due to innovation such as computers and internet while others have existed for centuries with an established and rigid industry structure.
Platform:some industries have operated in the digital world while others in the physical world which makes them quite different in their output.
Industry Demographics: Older populated industries which are resistance to change inhibits innovation, real estate being an example. Other industries comprise of younger, tech-savvy that constantly challenge the statuesque.
Innovation Impact on Real Estate.
The Commercial Real Estate, in particular, has felt the impact of innovation presented by other industries which has instilled a lot of pressure on owners to shift their investment and operating strategies.
E-commerce has forced most retailers to reduce store foot prints the re fore making the developers to reconsider their investment strategy as well as the composition of their retail properties, while on the other hand, it has created greater demand for industrial facilities. As a result of mobile connectivity, the average offices pace per workers has dropped thus boosting a growing “work at home” and shared work space theme as well as new office concepts such as co-working.
In the US alone, real estate ranks among the world’s largest asset classes with a total value exceeding $26.6 trillion. It’s the most essential and coveted resource in humanity. However, despite the size of the real estate, it is an industry stuck in the past where its participant shave little motive to change status quo.
The big question is, what is the next dimension for real estate? How can we change the way people view, use and interact with real estate?
Ideas on how to approach this
First is to look at the in he rent characteristics of real estate. The Real property differs from other consumer and commercial goods, financial instruments, and intangible services since it has a physical and fixed presence as well as a standard use. Real estate is known to have long-term uses which limit various frequency in many businesses. What’s more, it has a highly localized business which seems hard to reach for those seeking to bring change.
Then it is necessary to look at operators and users of the commercial real estate. On the residential side, transactions are quite in frequent thus buyers have no other wise but to be familiar with better tools and processes. On both the residential and commercial side, it’s clear that the industry is quite cheap or unaware in terms of technology which may hinder the interest and capital needed to build the business in the real estate.
Well, real estate has a lot of potential, therefore, there is more room to adopt technology more widely while more innovative tools and processes for companies and end users which will facilitate real estate business to a larger extent.