The Coming Real Estate Disruption

Future of “Real” Estate

Real-Estate as a sector is at tipping point of significant and fundamental change – driven by a confluence innovations & disruptions:

1. New institutional infrastructures – such as the digitisation of land registries, smart contracts and ICOs – opens up the effective trading of novel real estate assets, instruments & tools– in ways as yet unimagined but also unleashing new decentralised, distributed & real-time models of value creation and pricing.
2. Digital Regulation & compliance – such as shifting planning policy from regulating use classes to regulation cross contamination of pollution & impact using distributed sensors – real time Planning – based on impact – not use class proxies. This fundamentally creates the capacity for unleashing the medieval organic city which transcend industrial zoning logics and drives planning from focusing on likely outputs to outcomes.
3. Hybrid Financial Models & Instruments – such as impact derivatives which seek to fuse place based social outcomes & liabilities to real estate acting as hybrids of Social Impact Bonds with Traditional real-estate financing, or more novel synthetic financing instruments which seek to capture the value of investing in commons goods through social smart convents on adjacent Private housing.
4. New typologies of use such as the rise of co-working and co-living from Impact Hubs, WeWork to Roam are fundamentally giving rise to a new typologies and in many cases these are just the beginning and systemically shifting the business model of real-estate from product and asset to service – driven by data, outcomes and continuous optimisation. This is an emerging future of real estate not focused on optimising it’s mere utilisation and mere efficiency of space but directly aligned to the efficacy and outcome contribution of the built environment to the production of value.
5. 3D Printing, Manufacturing and Automation – Organizations such as wikihouse are challenging the means of production of real-estate – both decentralizing & distributing the means of production but also distributing innovation, creativity and care – this is a future which challenges not only the current capacity and also the capability of our construction industry but also most fundamentally the nature of our work place environments to respond to automation by unlocking the capacity to care, create, collaborate and utilize collective intelligence of their workforce.
6. Rebirth of Universal Policy – such as Universal Basic Income – which sets up the capacity to challenge the existing and dominant economic geography of our current real-estate model, or equality policy which recognises the impact of epigenetics and the effects of the environment on the issues of social & spatial justice.

Individually these trends and others such as place based systems change, collective impact and data driven environment and their directions of travel are already starting to disrupt real estate as we know it, together, they form the basis of a new model of place making.

Together these drivers will challenge the orthodoxy of our current economic geography, spatial typologies, business models, design practices, models of ownership and governance as we know them. And when amplified by the labour, value and demand shocks likely to be delivered by Brexit certainly in the UK (even if for a short period) – these disruptions are likely to fundamentally and dramatically change the future of real estate & quickly.

We know many major real-estate organisations across the world are beginning a process of strategic review – recognising the need to realign to a shifting “market”.

These reviews have an urgency to addressing the disruptions hurtling towards the industry. They need to drive meaningful transformation of their capacities, capabilities – reimagining what functions can be outsourced and what functions need to be in-sourced in this future along a driving a systematic transformation of their products as services & revising their current & future portfolios.

Get ready for the “real” disruption.. also come talk to us about the work we are doing to drive this future!