Mipim 2018 innovation insider supplement

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NEWS March 2018 www.mipim.com

SPECIAL REPORT • Investment • Management • Leasing • Startup Competition • Low Carbon Real Estate • Smart Cities • Smart Workplaces • Building Design • Building Technology

Innovation

Insider

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Innovation 3 Insider

Contents 5

INTRODUCTION

7

INVESTMENT

11

LANDLORDS AND TENANTS

The way forward

Proptech: the great enabler

Connecting the docs

15 Same players, different roles LEASING

18 Tomorrow’s game-changers

MIPIM STARTUP COMPETITION

SUSTAINABILITY

20

SMART CITIES

24

SMART WORKPLACES

27

BUILDING DESIGN

30

BUILDING TECHNOLOGY

33

PRODUCTS & SERVICES

36

Ready, willing and sustainable

Technology, technology, technology

From work space to meeting place

BIM, bash, bosh

Getting on board with the future

Innovation showcase

INNOVATION INSIDER— March 2018 — MIPIM News Special Report. Director of Publications Paul Zilk EDITORIAL DEPARTMENT Editor in Chief: Graham Parker Contributors: Adam Branson, Peter Clucas, Mark Faithfull, Isobel Lee, Liz Morrell, Doug Morrison Sub Editor Joanna Stephens Proofreader: Debbie Lincoln Head of Graphic Studio Herve Traisnel Graphic Studio Manager Frederic Beauseigneur COVER IMAGE © nadla / E+ / Getty Images PRODUCTION DEPARTMENT Publishing Director Martin Screpel Publishing Manager Amrane Lamiri Printer Riccobono Imprimeurs, Le Muy (France) Reed MIDEM, a joint stock company (SAS), with a capital of €310.000, 662 003 557 R.C.S. NANTERRE, having offices located at 27-33 Quai Alphonse Le Gallo - 92100 BOULOGNEBILLANCOURT (FRANCE), VAT number FR91 662 003 557. Contents © 2018 Reed MIDEM Market Publications. Publication registered 1st quarter 2018. Printed on PEFC Certified Paper.

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Innovation 5 Insider

INTRODUCTION

The way forward

© mauromod iStock / Getty Images Plus

There’s no running and hiding from technology. Not only is it reshaping every sector of the global real estate industry and reimagining the way people work, but it is also riding roughshod over long-established business models. Graham Parker reports

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EAL estate is going through a period of unprecedented change.

The technological revolution that has long been talked about is finally happening, sweeping away established practices and opening up new opportunities.

But although new startups and proptech have been attracting a lot of attention, innovation in real estate runs far deeper that just investing in technology to do the old things quicker or cheaper: it is changing the way everyone in the industry works, from investors and property managers to brokers and service providers.

No corner of the industry has escaped unscathed. In retail, whole product categories have disappeared from the malls and are available almost exclusively online. Shopping-centre owners have been embracing leisure and food and beverage operators to fill the gaps in their tenant line-ups. In the office sector, landlords are no longer just rent collectors as the emergence of property-as-a-service forces them to develop deeper relationships with their occupiers.

And logistics, long seen as one of property’s dowdiest sub-sectors, has emerged as a top performer as fulfilment is recognised as the keystone of any successful e-commerce business.

The giants of the industry initially seemed to be caught flat-footed by all this change. But now they have woken up to what is going on, they have been able to exploit their financial muscle and sheer scale to become drivers rather than followers of innovation.

Charles Boudet, managing director of JLL France, says: “Real estate has definitely been slow to adapt. We’ve been working the same way for a long time and the industry has been ripe for disruption. But now we need to embrace what we see as inevitable.”

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Charles Boudet: “We’ve been working the same way for a long time and the industry has been ripe for disruption. But now we need to embrace what we see as inevitable”

And Adolfo Ramirez Escudero, chairman of CBRE’s capital markets business across continental Europe, and chief executive of CBRE Spain, believes that “real estate is catching up fast and embracing these opportunities”. He adds: “We’ve reached an inflexion point and that’s a good thing.”

Martin Samworth, CBRE’s group president and CEO, EMEA, puts the client at the heart of all this change: “It’s a real opportunity to embrace and invest in platforms that deliver results more cost effectively and to pass that on to clients,” he says. Samworth points out that CBRE has developed technologies that are changing the way its people work across areas as diverse as valuation, retail and logistics. “It’s been well received by clients and it’s already leading to new client wins,” he adds. “Technology is allowing us to create an individual offer for clients by aggregating skillsets from across the business.”

At JLL, Boudet is clear that change on this scale does not come without cost. It is not just a matter of investing now, but of committing to continued investment indefinitely, he says: “As new value propositions emerge, the level of expectation increases.

In the future, we’ll need to offer simplicity in an increasingly complex world and, to do

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JLL France’s Charles Boudet that, we’ll need to develop new competencies. For instance, we already have 80 data scientists scraping data from across the business and working on visualisation.” So perhaps fears of huge job losses across the industry may be exaggerated. It’s just that the jobs will be different.

Andy Martin, newly installed as CEO of BNP Paribas Real Estate’s Advisory UK, believes tech could actually increase the demand for professional services: “Artificial intelligence [AI] and data mining will allow transparency in the market, with something nearer to perfect knowledge. I think that increases the need for professional advice,” he says. “Professional services will be more about advice and consultancy, using tools to make sure the information underpinning that advice is as full as possible. It’s all about what you do with that data — and that’s what becomes very personal and professional.”

Investors are also having to adapt their strategies in this changing landscape. And according to Alice Breheny, head of the global real estate research team at TH Real Estate, it is a moving target. “It’s something we’re having to react to literally on a daily basis,” she says, pointing out that TH is continually adapting its acquisition strategies to target “future-proof progressive buildings” in the light of technological changes.

It is not just the owners, occupiers and advisers in property that are having to adapt.

“

CBRE’s Martin Samworth

TH Real Estate’s Alice Breheny

BNP Paribas Real Estate’s Andy Martin

Yardi Systems’ Richard Gerritsen

Service providers to the industry are being swept along by the wave of change as well.

Philip Gerritsen, regional sales director for continental Europe at Yardi Systems, says the process started with the financial crash of the last decade. “The crisis saw a large drive towards compliance and risk management, and these have become major priorities for investors. Real estate has had to catch up on many different levels and there’s still a need to evolve as an industry,” he says.

Gerritsen believes that getting a handle on data is the most crucial aspect, but he warns that this is hard for an industry where 75% of data is held in data silos.

“The starting point is getting all that data

on to common platforms,” he says. “People will have to begin within their own organisations with data repositioning. Only then can you think about connecting it all with smart tools: you can have the coolest app that everyone loves but, if the data’s not there, it’s nothing.”

Another provider adapting fast is Drooms, which for 16 years has supported companies in the field of real estate, M&A, legal, energy and logistics across a variety of transactions. Co-founder and chairman Jan Hoffmeister believes AI will transform the due-diligence process: “In the not-sodistant future, our data rooms will be able to mechanically create fully automated due-diligence reports in 95% of cases at the touch of a button. The remaining 5% will be managed by specialists. This will significantly improve the entire process, which is currently very long-winded.”

Clearly every area of the real estate industry has been touched by the new industrial revolution, but it would be foolish to think that the pace of change will slow. There’s a lot more disruption to come.

Andy Martin: “Artificial intelligence and data mining will allow transparency in the market, with something nearer to perfect knowledge. I think that increases the need for professional advice”

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Innovation 7 Insider

INVESTMENT

© from2015 DigitalVision Vectors / Getty Images

Proptech: the R great enabler Big data and artificial intelligence are offering deeper insights into investment performance, while the blockchain is opening up new ways of trading property. Doug Morrison looks at how proptech is enabling investors to gain an edge

EAL estate used to be routinely described as a people business first and foremost, and one that would treat with some scepticism the very idea of technology as a disruptive force for good. How things have changed.

As a measure of just how far technology has been embraced by the industry, the analytics firm CB Insights calculates that, since 2011, venture-capital investment in proptech has totalled $9.7bn globally. As remarkable as that grand total is, the fact that half of it has come in the past two years — and an estimated $3.4bn in 2017 alone.

One firm riding the proptech wave is VTS, a New York-headquartered business that has seen the global adoption of its leasing and asset-management platform extend to 7 billion sq ft (650 million sq m) since it was founded six years ago.

Charlie Wade, VTS’ UK managing director, says the US is leading the way in the evolution of proptech. However, VTS grew three-fold in the UK in 2016-2017, and

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Innovation 8 Insider

VTS’ Charlie Wade

Wade anticipates a similar trajectory for the firm and others like it across Europe. As he puts it, 2016 was “the year of awareness” when there was a lot of talk about proptech. “People wanted to understand what it meant, and I think a lot of clarity came to the marketplace,” he says. “Then 2017 was the year of signing up. I strongly believe 2018 will be the year when people actually adopt technology and see the real return on their investment.”

“

Charlie Wade: “I strongly believe 2018 will be the year when people actually adopt technology and see the real return on their investment”

Another sign of just how far the commercial real estate (CRE) industry has advanced lies in the seriousness with which it is assessing the potential benefits of the blockchain, which is a long way from adoption let alone financial payback. It is also the technology best known for powering the controversial cryptocurrency Bitcoin.

It is difficult to ignore the critical media noise around the soaring value and at times questionable use of Bitcoin. But a recent study by Deloitte nonetheless claims that “blockchain-based smart contracts can potentially transform core CRE operations”, from buying and selling to financing, leasing and management.

Blockchain technology — a digitised, centralised ledger that immutably records and shares information — enables the secure, near real-time settlement of transactions.

In theory, the benefits to business are obvious and not just in the real estate world.

Last month, 300 bankers, insurers and academics gathered at a conference in Amsterdam to hear the — favourable — results of a two-year study into how the blockchain can improve the transparency and administration of the pensions industry. The research was conducted jointly by APG and PGGM, which are not only the two biggest Dutch pension providers, but among Europe’s leading investors in real estate. All of sudden, the blockchain has serious institutional support.

The blockchain also figures prominently in the 2018 edition of Emerging Trends In Real Estate Global, which is published at MIPIM. Based on interviews with industry leaders around the world, the report says that the blockchain and driverless cars are viewed above all others as the technologies that will have a significant impact on real estate.

Precisely how and where that impact is felt remains to be seen. The report indicates an industry consensus that the blockchain has the capability to create a new system of property-title documentation and transfer, and that governments across the world are likely to adopt this technology to complement or replace land registries. As for its influence on the value and operation of real estate, there is less focus on the idea that the blockchain might be used to buy and sell property instantaneously, or that it could be used to syndicate the equity of a property. The big impact on values is more likely to come from the industry using the blockchain increasingly to document information about a property or company, resulting in the due-diligence process becoming a lot quicker and cheaper.

Whether it is the blockchain or other technologies, it is the same drive to save time and cut costs in the processing of transactions and the subsequent management of real estate that is most prevalent in proptech today. It is no coincidence that investment in proptech has soared during the prevailing late-cycle period of real estate in the mature US and European markets.

In this low interest-rate, low-return environment, investors, fund managers and their agents are starting to see technology in a new light.

VTS’s dashboards offer new insights into property performance

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Innovation 9 Insider

Coyote’s technology streamlines leasing

Interest is building in “anything that gives them an edge and helps them drive the performance of a building by increasing net operating income and returns”, says Oli Farago, CEO of London-based Coyote, whose software helps investors and owners track market activity and quickly analyse data on transactions. “We’re seeing more and more companies wanting to have a conversation,” Farago adds. “They all recognise that, if they don’t start looking at digital transformation and how they can use technology to change their businesses for the better, then the status quo won’t

“

Oli Farago: “More and more companies recognise that, if they don’t start looking at how they can use technology to change their businesses for the better, other companies will leapfrog them”

remain — other companies will be able to leap-frog them.”

Coyote, VTS and scores of similar software firms, as well as the promoters of the blockchain all seek to collate data for real estate clients which would otherwise be dealing with a dozen disparate sources of information. As Farago suggests, it doesn’t matter whether they are out of the office and on site: “It’s about showing the right data to the right people at the right time.

Making sure that information is constantly being displayed to them ensures they don’t lose tenants by not engaging with them quickly enough.”

“This is about efficiency. This isn’t disruption technology. This isn’t technology that’s trying to replace someone’s job,” insists Wade, who like Farago believes the next goal for proptech should be the standardisation of real estate data.

According to Wade, real estate investors “massively over-estimate” the significance of disruptive technology over the next

10 years and “massively under-estimate” the marginal gains that could be made in the next 18 months to two years. “You’re not going to see a huge revolution in your workflow,” he adds. “It’s about, can I do what I do today 10% better and get a 3% higher return? It’s about marginal gains in multiple places that add up to a bigger efficiency picture and return on investment.”

Coyote’s Oli Farago

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Advertisement

Time for action German-based investment manager is sponsor of the MIPIM startup competition.

The company is positioning itself at the sharp end of innovation in real estate, Jörn Stobbe writes

U

NION Investment is the global sponsor of the MIPIM Startup Competition this year. This has given our commitment to innovation, digitisation and startups an even stronger international focus, which in turn will enable us to open up new opportunities for cooperation and perhaps also for future investment in exciting concepts and business ideas. In addition to providing financial support for the competition, we contributed our expertise in assessing digital business concepts during the preliminary qualifying rounds in London, New York and Hong Kong. We are now looking forward to being part of the jury that selects the winners in the final round in Cannes.

The changes we are currently experiencing transcend regional borders. Digitisation is an unstoppable worldwide trend. Like the new generation of entrepreneurs, we think globally. This competition, organised

by Reed MIDEM, is a major international platform and opens up a wealth of new, global opportunities and possibilities.

When it comes to innovation, we need to think internationally — we believe that is the most effective and appropriate benchmark for our business.

Our collaborative approach is in tune with today’s business world and highly flexible.

We want to team up with the very best, so we can achieve great things together and develop standards for the industry which others can benefit from or build on. We see a host of opportunities for making connections. Our own PropTech Innovation Award is the perfect example of this. We have linked our competition with the MIPIM Startup Competition, which means specifically that the best idea from the PropTech Innovation Award will automatically receive a place in one of the preliminary rounds of the next MIPIM Startup Competition. It’s

fascinating to see how the different networks are developing and beginning to mesh with each other.

Anything that helps to move the traditionally sedate real estate industry forward is justified in principle. Many people thought sustainability was a passing trend. A decade later, we unfortunately have to conclude that there are still too few companies tackling these issues. Very few sustainability strategies are designed to address climate-related risks. So we’re grateful for anything the large trade show platforms can do to motivate people to take action — there’s a gulf between hearing the message and understanding it, and between understanding it and acting on it. MIPIM 2018 needs to send out a strong signal that only action counts.

Jörn Stobbe is COO and member of the management board of Union Investment Real Estate GmbH.

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Innovation 11 Insider

LANDLORDS AND TENANTS

Connecting

© audioundwerbung / iStock / Getty Images Plus

the docs Connected machine technology is starting to infiltrate the real estate sector, from predictive facilities management to AI-powered contract agreements. But with tenant expectations changing and working practices transitioning, there’s much more to come, writes Mark Faithfull

A

NOVEMBER 2017 KPMG survey of more than 130 real estate decision-makers from 36 companies from around the world found that 86% of the respondents viewed digital and technological innovation as an opportunity, rather than a threat. The vast majority also acknowledged that proptech will have a very, “or somewhat”, significant impact on their business.

Yet when asked where they would rank their organisation with regards to digital and technological innovation on a scale of one to 10, 53% rated themselves at just five or less, with only 13% citing themselves at the cutting edge of proptech.

Of course, this disconnect between importance and performance comes within a highly regulated industry with strict fund controls and accountability, making the mainstream property industry understandably considered in its approach to change. But Ron Bakker, partner at PLP Architecture, believes that adoption is accelerating. His practice designed Amsterdam’s The Edge for main occupier Deloitte and is working on the ultra-connected 22 Bishopsgate, London for AXA Real Estate.

Bakker says: “I’m very excited to see how the industry will make the office experience different. Staff are the real goal. Technology asks the questions — it is not the answer.

This is very new, both for the real estate sector and for major corporate clients, who are having to adjust to massive change.”

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Ron Bakker: “Technology asks the questions — it is not the answer. This is very new, both for the real estate sector and corporate clients, who are having to adjust to massive change” MARCH 2018

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Innovation 12 Insider

PLP Architecture’s 22 Bishopsgate, London

Increased connectivity within buildings via the internet of things (IoT) and the concept of the office as a service enabled by technology are being embraced by traditional landlords keen to compete with the proptech disruptors and the plethora of co-working/ serviced-office providers. At the same time, a new generation of tenants are demanding more flexible office space with enhanced amenities and services, including events, social facilities, leisure facilities and collaborative spaces.

“It’s all about a better user experience and, in many ways, the office sector has been lagging residential, where more smart control is becoming increasingly common,” says Tom Carroll, JLL’s director of corporate occupier research, EMEA and UK. “Certainly, we’re seeing the best-in-class developers building the IoT across their portfolios and occupiers embracing this type of space.

In fact, I would say we are at an inflexion point. The IoT is flying up the agenda and moving away from energy reduction towards performance, productivity and keeping the workforce happy. We’re beginning to see machine learning infiltrate every aspect of the real estate life cycle and I fully expect that to accelerate and to drive value.”

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Tom Carroll: “The IoT is flying up the agenda and moving away from energy reduction towards performance, productivity and keeping the workforce happy” Opportunities abound. For example, many internal data-driven systems and processes, such as tenant records and accounts, could be automated, centralised and linked to external data sources. The portfolio-valuation process could also be made more efficient by automatically pulling valuation data from external sources into internal databases in real time, making systems more interactive and dynamic.

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PLP’s Bakker adds: “We are only just seeing the start of the proper analysis of big data and, of course, this comes with issues in terms of information, privacy and ownership. But it’s where the IoT comes in. As a small example, at The Edge, the coffee machines are linked to the provider and, when the coffee or milk is empty, the provider’s system sends that on to the facilities company, who can send someone up to refill. That’s just a tiny example of the IoT in action.”

Elsewhere, blockchain is being increasingly used by the global investment banking and fintech industries. In the property sector, blockchain has been mainly used for title deeds, since it is seen as being both more efficient and more resistant to fraud. But as blockchain becomes more widely adopted by the commercial real estate sector, it could make property transactions more transparent, less costly and more efficient.

Thomas Grounds, research analyst for BNP Paribas Real Estate, expects to see the in-

creased use of technology-led leasing platforms, along with the greater use of license agreements as opposed to leases, helping to streamline the tenant-finding process.

“While traditional leases are not dead, this will offer occupiers a wider range of terms and contractual options when leasing space,” he says. “Blockchain technology will have a vital role to play in decreasing costs in agreeing leasing deals and cutting down on the administrative and organisational burdens involved in getting tenants into buildings and paying rent. Landlords are also set to increasingly develop their own management models to service the rising demand for flexible leasing.”

Akshay Thakur, EMEA director of JLL’s smart-building programme, points out that the IoT has been around for a long time in the form of machine-to-machine communication. “But this connection of things has now been adapted to the workspace and around the tenant,” he

Innovation 13 Insider

PLP Architecture’s The Edge in Amsterdam

RE-EVALUATING VALUATIONS The world of property valuations is changing, as technology is brought to bear on the valuation process. For example, Premium, Prelios Valuations’ new real estate platform, runs intelligent algorithms on millions of data points in the cloud to support banks, insurance companies and investment funds in making strategic decisions.

Prelios Valuations is Italy’s leader in property valuations producing over 80,000 valuations and 650,000 revaluations per year. The advantages of bringing automation to bear on such a large database are clear, and Prelios developed Premium to draw on more than 300 socio-demographic big data categories and over 20 years of real estate trends.

Prelios Valuations claims Premium can provides a risk Index to calculate the probability of loss of value over the short term; mortgage lending valuations assessing the prudential value of the property over the course of the loan; a predictive market valuation of the future market value over the short and medium term and a judicial value to calculate the most likely award price in an auction.

However the changing ways in which property is designed and occupied are putting pressure on traditional valuation methods. “How do you put a price on smart real estate?” asks Javier Kindelan Williams, managing director of Valuation & Advisory EMEA for CBRE Kindelan Williams believes smart buildings will be subject to very much the same valuation and pricing principles used for sustainable buildings. “It relies on the ability to demonstrate not just the value proposition but also the enhanced performance in the income stream and cash flow for the right pricing to take place,” he says.

“When analysing future cash flows and measuring the stability or security of income stream the letting variables should be more robust in smart buildings, and the optimum occupier experience, real time asset risk management and liquidity of asset should also provide a basis for greater efficiency and differentiation being transferred to the market value and ultimately price of assets,” Kindelan Williams concludes.

adds. “Part of this is that occupiers are more aware of what is possible and the outcomes they are looking for.”

Thakur stresses that this is not only about large, corporate occupiers: “Of course, the base services and the ability to personalise is something that major tenants are looking for. But even smaller tenants can bring sensors and control into their environments and start making their environments more personal. In addition, we’re seeing some landlords offer packages of services and connectivity to their occupiers. In fact, it is the smaller tenants that are more likely to be seeking an off-the-shelf product.”

Thakur believes that some fundamental changes are coming: “Firstly, we need to be more aware of how our data will be used.

People tend to be cautious about their privacy. We need to ensure a better understanding of this, so that people can see it’s being used to optimise their experience. Secondly, the interfaces need to become easier and voice is likely to play a major part in this, which will mean that input interfaces are replaced by simple voice commands.”

BNP Paribas Real Estate’s Grounds also expects the use of big data to become essential for providing investors with real-time insights into how their building, location and tenants are performing, which in turn will enable more accurate analysis of the likely future patterns of occupier behaviour. “New lease models will need to be developed that accommodate occupiers’ demands for both occupational certainty on some space and the possibility of flexing in and out of additional space as required,” he adds.

But, as PLP’s Bakker points out, much of the innovation will be driven by the search to find and keep talent: “What is becoming clear with millennials is that, in this age of being able to work at home or in a coffee shop, they still want somewhere to call ‘work’ — a place to come. That may be less about the desk and more about the community, because they have more complex ideas about what they want from working.

And this comes at a time when landlords need to ensure they provide flexibility and high quality for every tenant — especially as those tenants want to be more agile and have the ability to grow or become smaller.

We will probably see companies come and go more regularly.”

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LEASING

Same players, different roles Innovations like pop-ups and co-working are disrupting traditional leasing models, while virtual reality and social media are transforming conventional property marketing. Is this the revenge of the geeks on the brokers? Adam Branson asks the question

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T WASN’T so long ago that proptech firms and commercial agents were viewed as mutually hostile. The former were set to disrupt the entire industry, while the latter were fighting a losing battle to protect their long-standing and potentially outmoded business model.

Generally speaking, those days appear to be behind us. Now, leading agents are either embracing technology and building solutions of their own, or buying in products from an increasingly crowded — and therefore affordable — proptech marketplace.

“It was easy to imagine there would be a paradigm shift and the world was going to

be turned on its head,” says Stewart Smith, managing director of CBRE’s advisory and transaction services, occupier team. “But actually, businesses like CBRE got their heads around the technology. Many of these things just enable us to do our jobs more efficiently.”

So how have commercial agents adapted to the digital revolution? And how might the sector continue to evolve?

What is clear is that proptech is growing exponentially. In 2016, £1.9bn (€2.1bn) was invested in the sector, according to JLL. Last year, that figure hit £2.6bn. That is still some way behind other parts of the economy

— the equivalent investment into fintech stood at around 10 times proptech in 2017 — but the direction of travel is undeniable.

It is also evident that some companies are more mature than others when it comes to embracing change. For instance, CBRE started its journey towards greater digitalisation around 10 years ago, when Smith and his colleague Richard Smart worked together on a project dubbed Plus. “It was around capturing data in the marketplace,” Smart says. “That was before a lot of the aggregators came into the marketplace and it allowed us to provide better quality insight and analytics to our clients. We’ve been able to build upon that base.”

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Matterport’s visualisation brings property searches to life

A similar story is to be found at CBRE’s chief competitor JLL. According to Charles Boudet, managing director of JLL France and the man responsible for taking the lead on digitalisation across EMEA, the agent has been alive to the issues presented by proptech for some time. “We identified the fact that the industry was ripe for disruption a number of years ago,” he says. “We think that it’s an opportunity — we’re trying to embrace it rather than resist it. What we’re really trying to do is reinvent the real estate experience by putting technology at the heart of our business. We think the way people own and use buildings is changing as quickly as the way we work and shop.”

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Charles Boudet: “We think the way people own and use buildings is changing as quickly as the way we work and shop” Some proptech companies still believe that commercial property needs to be kicked into the modern era. But again, there has been a softening in terms of attitudes. Where once some aggregators sought to kill agents stone dead, today they view them as partners. “I feel passionately that technology should empower people and business. It should not confuse, disintermediate or disrupt,” says Chris Noden, chief technical officer and co-founder of Harness Property In-

telligence. “We very much see the role of proptech as one that strengthens relationships.”

“

Chris Noden: “I feel passionately that technology should empower people and business. It should not confuse, disintermediate or disrupt” A solid example of how JLL is using technology to transform its commercial leasing offer is, unsurprisingly, to be found in the agent’s Paris office. There, a project known as NxT Office, which allows clients to virtually tour potential new spaces, has been in operation for the last year or so. “We’ve engaged in creating digital tours of all of the 3,600 spaces that are available in the Paris area,” Boudet says. “It means that, in one hour, clients can shop the market and create their shortlist, which could otherwise have taken three months. We’ve been working with NxT Office for a year and the clients absolutely love it.”

Boudet adds: “There is still clearly the necessity to have a very qualified and experienced consultant who can help navigate the way through all this data. So, it just changes our job. That experience without the consultant in the room would not be as rewarding or frictionless for the client.”

The technology that sits behind Nxt Office was developed by Matterport. The compa-

ny’s EMEA director, James Morris-Manuel, says this is a good example of how Matterport can help commercial agents to differentiate themselves in order to win more mandates and speed up the sales cycle.

An alternative use of Matterport’s technology is to be found at CBRE in the UK where, instead of bringing clients into a dedicated space, the company hosts digital walkthroughs of offices on a website and then sends links to clients. The disadvantage is that clients do not have a consultant sitting with them, but there are clear advantages in terms of convenience.

“They can deliver a first viewing to you wherever you are,” Morris-Manuel says. “There are also time and cost savings. It’s a slightly different way of delivering the product.”

In the retail space, CBRE has also developed its own technology, known as Calibrate, which uses existing data to allow retail and leisure brands to make better-informed location decisions. “It’s a very clever piece of technology,” Smith says. “The old-fashioned way was unbelievably time consuming — people standing there with clipboards clicking away. Today, you can get the data from mobile-phone apps.”

In terms of future developments, Matterport’s Morris-Manuel believes there will be a further shift towards market transparency through the use of virtual information becoming more widely available. He also predicts that virtual reality (VR) will come to the fore. “VR gives the ability to feel emotionally present in a space,” he says.

“You can really feel it and walk around and picture where desks could go and so on.

One option for agents is to have a headset in the office and invite people in. The other way is to send people branded Google Cardboard headsets, and that person can sit at home with their mobile and walk around.”

Then there is the potential of artificial intelligence (AI), which many are already predicting will transform business activities that involve repeat, rule-based functions. “AI will take longer to come to fruition but may well have a huge impact on parts of the industry,” Smith says.

So, the big agents are embracing change and finding ways to use proptech to enhance their business models. AI may yet change all that and lead to a major reduction in the need for human agents. For now, however, proptech is changing the role of the agent rather than removing it altogether.

MARCH 2018

MIPIM NEWS SPECIAL REPORT

Innovation 18 Insider

MIPIM STARTUP COMPETITION Now in its third year, the MIPIM Startup Competition is on a mission to find the most promising and innovative startups to tackle the world’s urban challenges. Liz Morrell looks at the nine contenders for the top prize

NEW YORK FINALISTS Acasa

Storefront won the 2017 MIPIM Startup Competition

Tomorrow’s

game-changers A ARON Block is co-founder and managing director of MetaProp NYC, the real estate tech partner for the MIPIM Startup Competition. Block, who will be master of ceremonies at tomorrow’s awards event in the Grand Auditorium, calls this year’s finalists “the best yet”.

Block says that innovation is coming, whether the industry wants to acknowledge it or not. “Those who embrace the tech evolution will increasingly grab market share, increase NOI and ROI, and recruit and retain the top talent,” he adds. “So it’s very important for the community to help shine a spotlight on the best new technologies.”

Union Investment Real Estate is the global sponsor of the competition and has been a judge in the preliminary qualifying rounds in London, New York and Hong Kong.

Joern Stobbe, Union Investment’s chief operating officer and member of the man-

MIPIM NEWS SPECIAL REPORT

MARCH 2018

agement board, says the competition opens up a wealth of global opportunities. “The changes we are currently experiencing transcend regional borders,” he says. “We want to team up with the very best, so we can achieve great things together and develop standards for the industry that others can benefit from or build on.”

Alex Rangel, founder and CEO of Ravti, was one of last year’s three winners. “It was an excellent experience to be competing against the world’s best CRE startups in front of the premier CRE owners and operators in the world,” he says.

Matthew Greenwell, UK director of 2017 winner Storefront, says that his short-term retail-space company is now working with some of the biggest property institutions in Europe.

“The contacts and connections we made off the back of last year’s competition have proved invaluable for our growth,” he adds.

Acasa CEO and co-founder Nick Katz says entering the MIPIM Startup Competition “was the best global stage to get Acasa in front of all the leaders in the world of real estate that we Acasa’s Nick Katz want to work with”.

Acasa started life as a consumer app, offering a one-stop shop to set up, run and pay for utilities such as energy, broadband, water and council tax. “The intention has always been to become a key part of the built environment’s technology stack,” Katz says. “We wanted to make sure we were building from the inside of the home out, starting with the core needs of the resident, and building outward. Now that we’ve partnered with key utility providers, on-demand apps and real estate owners and managers, we’re in a prime position to become the payments and convenience layer for the home that can interoperate with all other existing systems.”

PlanRadar

PlanRadar is a cloud-based SaaS (software as a service) system that allows tasks and defects in construction and real estate projects to be better tracked and managed. “Today, in each real estate project, there is an average of one to two defects every 10 sq m. Our solution supports the user in recording, documenting and tracking these,” says PlanRadar managing director Sander van de Rijdt, who co-founded the company with three other development and sales experts after 10 years in the construction industry.

PlanRadar’s service can be used by companies and projects of any size. “Our users already achieve time savings of an average of seven hours a week, or around 18% of their working time. The even bigger advantages are in the areas of transparency, consistent communication and the avoidance of subsequent errors or defects in projects,” Van de Rijdt adds.

PlanRadar in action

Innovation 19 Insider

RealAtom

RealAtom claims to be the only marketplace for commercial real estate loans, matching borrowers with 500-plus lenders, including Capital One and Goldman Sachs. “This $500bn industry is entirely offline,” says RealAtom co-founder and CEO Yulia Yaani. “Right now, finding the right lenders takes more than 40 days. With RealAtom, it takes 48 hours.”

The company has already processed $723m of loan requests since its launch in March 2017.

“The reason we decided to build RealAtom is because we believe that transparency in commercial real estate lending will result in fair transactions, process efficiency and accountability. Our goal is to give all players, regardless of size and experience, the luxury of being honest, efficient, creative and successful,” Yaani adds.

Grid Edge

LONDON FINALISTS

Grid Edge was founded by three friends — Daniel Wright, Jim Scott and Tom Anderson — from Aston University in Birmingham. While at university, the trio led a £1.1m (€1.2m) industrial R&D project called Itheca, which inspired the first generation of Grid Edge’s artificial intelligence (AI) software service.

“Our critical innovation was the use of predictive-learning algorithms to model and predict a building’s future energy profile, so that energy generation and storage assets can be controlled optimally in real time,” says Grid Edge CEO Tom Anderson. “With the success of Itheca behind us, we made the leap away from university research and set up shop as Grid Edge with the aim of bringing innovation to the consumer’s side of the meter through our cloud-based software service, which enables consumers to predict, optimise and control their energy profile.”

Disruptive Technologies

Physee

Disruptive Technologies believes it has created the world’s smallest wireless sensor, which can be placed anywhere to collect data. “Real estate companies must balance costs with regulation compliance and tenant comfort,” says Disruptive Technologies CEO Erik Fossum Færevaag.

“Our sensing solution brings value to a broad range of operations, from refrigeration compliance and preventative maintenance to tenant comfort and energy savings. By providing data from everywhere, companies can make the best decisions for optimising their operations.”

Disruptive Technologies also claims to simplify the management and security of data collection, thanks to a one-stop shop that delivers data securely from wireless mini-sensors to the analytics platform used by its customers.

Physee was founded by two applied physicists who, as graduates, found a way to generate electricity with transparent glass. From this breakthrough, the company has developed two clean energy technologies — SmartWindow and PowerWindow — both of which convert light into electricity. SmartWindow also includes sensors that measure climate conditions and calculate the optimal building settings.

“Our windows can generate electricity for inside systems and simultaneously use outside information to optimise them,” says Maarten de Haas, head of business development at Physee.

“With our windows, we increase the energy efficiency of glass facades, resulting in 15% lower energy costs per year.”

HONG KONG FINALISTS Snapflat

Disruptive Technologies’ Erik Fossum Faerevaag

Snapflat aims to make the process of finding a new home or tenant easier by sourcing the next tenant before the current one moves out.

Through a team of licensed agents, the company uses an online platform to list and advertise accommodation. Home-hunters can look for accommodation and schedule viewings with one click. After departing tenants show their home to visitors (for which they are paid 15% of their rent by Snapflat), the licensed agents then handle all the negotiations and paperwork. In addition to ensuring no vacancies, the Snapflat model claims to save an average of three to four weeks of rent.

Workwell

As a 21-year-old intern at UBS in Switzerland, Workwell CEO and co-founder Marie Schneegans started knocking on people’s office doors to invite them out to lunch. This approach, she says, helped her to learn more about the company, improve her network and jumpstart projects.

In the process, she also realised that there was a market for a mobile app to help employees to connect with their co-workers. That realisation expanded to include centralised access to all services for employees in office buildings. “Workwell gives easy access from a single interface to services as varied as carpooling, lighting and AC control, cafeteria menus, meeting-room bookings and concierge,” she says. “Workwell makes it easy for a property owner to give access to all of a building’s services via only one app.”

Workwell’s Marie Schneegans

WeMaintain

WeMaintain is a B2B marketplace that pairs lift mechanics with customers, such as office or residential trustees and property managers, depending on location. The platform was launched last September by co-founder and CEO Benoit Dupont. “Our mission is to empower mechanics to become their own boss, so that customers get an enhanced experience,” Dupont says. “In this industry, organisation still relies on physical branches, face-to-face meetings, paper contracts and disparity of information. Digital can rebalance the value chain by connecting the key stakeholders: mechanics and customers.”

Dupont says his service shows that the internet of things (IoT) is not the answer to everything: “Despite announcements on IoT sensors by industry leaders, WeMaintain is fully aware that the real value is created by mechanics. Even with a top sensor in an elevator, a mechanic must still go on site to repair the issue.”

Wemaintain’s Benoit Dupont

MARCH 2018

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Innovation 20 Insider

SUSTAINABILITY

Ready, willing and sustainable G

© PPAMPicture / iStock / Getty Images Plus

Demand from institutional investors and corporate occupiers has pushed sustainability up the global agenda for commercial buildings. Mark Faithfull hears that the key to making green work is creating buildings that are smarter by design

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REEN buildings, the sustainability premium and the long-term benefits of investing in, building and inhabiting more energy-efficient structures has been talked about for so long that one could be forgiven for thinking that the green debate is well and truly over. Truth is, of course, that while many talked, few have walked the green mile.

But sustainable architecture is becoming far more pertinent for commercial real estate, with targets for CO2 emissions increasingly applied through building regulations and a swathe of certifications available to classify a building by its energy performance and, increasingly, its ‘wellness’.

Some developers have taken a literal approach to ‘green’ architecture and set new bars. An example is Italian architect Stefano Boeri’s proposed Green Towers in Nanjing, China. The scheme is based on the same principle as the company’s Bosco Verticale (Vertical Forest) in Milan, which is cloaked in 2,500 hanging plants and incorporates 1,100 trees from 23 local species.

Meanwhile, in Copenhagen — which has committed to becoming the first zero-carbon city by 2025 — Bjarke Ingels Group’s ARC power plant will open this autumn and feature a ski slope accessed via the roof, plus a hiking trail, all while burning 400,000 tonnes of waste.

“We are seeing two main drivers from clients: the desire to certify and benchmark schemes using the various certification standards available and also a push for social improvements in terms of the wellbeing of staff, the health of the building

Innovation 21 Insider

The proposed Green Towers in Nanjing, China, from Stefano Boeri Architetti

and aspects such as transport networks,” says Lizzie Jones, sustainability director at advisor Savills. “If we go back just two or three years, a lot of questions were being raised about ‘green value’ and at the time it was quite hard [to be specific]. But now we are seeing a lot of focus on obsolescence with those buildings that are not up-to-date sustainably, not just from investors but also tenants, as well as concerns over staff retention. Expectations have moved forward.”

Of course, sustainability is about more than the biggest, shiniest new projects.

Take a major commercial hub such as Manhattan, for example. There, the average building is over 50 years old, while the mean space allotted per US worker has been reduced by 9% over the past seven years, declining to 181 sq ft (16.81 sq m). However, more robust employment levels mean that firms worldwide are increasingly investing in building design to attract and retain their talent.

“A lot of work has been focused on areas of value creation, especially the direct impact of energy consumption and utilities, and the operational benefits, including greater reliability, building resilience and staff productivity,” says Joe Gomez, head of energy and sustainability at CBRE EMEA. “Then, with sustainability, there are the twin areas of enhancing the brand through green credentials and independent benchmarking, plus legislative requirements. Smarter buildings provide the ability to take disparate systems and bring them together. By putting those systems on a common backbone, the building can start to self-monitor and alert the user to issues.

That makes it far more reactive in a real and dynamic way, meaning that problems can be resolved quickly and, from

“

Lizzie Jones: “We are seeing two main drivers from clients: the desire to certify and benchmark schemes, and a push for social improvements”

PWC ON THE CUTTING EDGE IN ACTING On Carbon: Our 10-Year Journey, PwC has set out new emissions and renewables targets for 2022, using 2007 baselines. The aim is to reduce its total operational carbon emissions by 40%, purchase 100% of electricity from verified renewable sources within the next four years and offset 100% of its total Scope 1, 2 and 3 carbon emissions to remain carbon neutral.

Since 2007, PwC says it has reduced the carbon footprint associated with energy consumption in its buildings by 77%, while the business grew by 44%. This has been achieved by initiatives such as turning off lights out of hours and switching to renewable electricity contracts; optimising space to reduce energy needs; refurbishing offices to high sustainable standards; and investing in new, low-carbon technologies.

“Being very clear on what we wanted to achieve has allowed us to challenge ourselves to do things differently, from how we light, heat and cool our buildings, to how we design and use our office spaces, and how we work,” says PwC chairman and senior partner Kevin Ellis. “We’ve made good progress, but we recognise we’ve also made some mistakes along the way and that’s why we’re keen to share our experience.”

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Innovation 23 Insider

GOING WELL IN SLOUGH

Copenhagen aims to be the first zero-carbon city by 2015 a cost-benefit perspective, the building needs fewer staff to maintain it.”

Savills’ sustainability consultant Alan Page adds: “From investors, the drive is coming from those with a long-term outlook and their own environmental goals, particularly led by the institutional investors from the pension funds. There’s also a push from certain clients, such as The Guardian and Marks & Spencer, which have their own agendas. Also, with real estate groups acquiring each other, the over-arching [corporate] culture tends to be applied — so a European company may bring BREEAM to its full portfolio, for example. Of course, there has been a lot of success, but there’s also a long way to go. Certifications such as BREEAM and LEED still tend to be focused on the prime end and new buildings. The argument over return on investment [ROI] is tougher for the non-corporates and existing buildings.”

CBRE’s Gomez adds: “The tech industries in particular have a real appetite for sustainability, while investors look at sustainable buildings as easier to let, more marketable and potentially of higher value. It’s something that has certainly gone up the agenda.”

LATE last year, Landid and Brockton Capital became the first developers in the UK to achieve the WELL Building Standard certification for the 120,000 sq ft (11,148 sq m) The Porter Building in Slough, west London.

Designed by architect TP Bennett, The Porter Building has been developed to maximise the wellbeing of its occupiers, with abundant natural light, fresh air, filtered drinking water, healthy eating options, indoor planting, noise-reduction measures and a layout aimed at encouraging movement around the workplace.

Landid director Chris Hiatt says: “We have embedded wellbeing into the design and construction of the building itself. We expect that, in five years’ time, all new office buildings will be seeking WELL certification. Wellbeing will simply become part of the language of office design and we are very proud to be playing a leading role in that transformation.”

Developed speculatively, the building offers flexible office space over four floors. Financial services technology company Fiserv preleased the entire first floor, which consists of 28,400 sq ft.

David Blair, principal director at TP Bennett, adds: “The most up-to-date research has informed our design at every stage, resulting in a workspace that is open, connected and flexible.”

“

Joe Gomez: “The tech industries in particular have a real appetite for sustainability, while investors look at sustainable buildings as easier to let, more marketable and potentially of higher value”

MARCH 2018

MIPIM NEWS SPECIAL REPORT

Innovation 24 Insider

SMART CITIES

Technology, technology, technology I It estimated that around 70% of the world’s population will be living in cities by 2050. That represents a formidable challenge in terms of how we plan, build and manage our urban environment. So how will we do it? Enter the smart city.

Isobel Lee reports

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MARCH 2018

NTELLIGENT transport will be the pivotal factor in planning the cities of the future, marking the difference between failure and success for the world’s urban areas. This is the view of Rosemary Feenan, JLL’s international director and head of the cities research programme.

“Smart mobility is really the headline issue in creating cities of the future, because how we move around cities is going to determine their success and comfort,” she says.

“Among the most exciting aspects of the work that’s being done now on smart mobility — beyond the tangible aspects of congestion and pollution — are the new mobility solutions that help people to live and work in a smarter way,” Feenan adds. “As well as being more inclusive and cost effective, the right smart-mobility solutions enable the release of land for alternative uses. Last year, a JLL report identified 10,500 car parks in the UK alone that could make way for 400,000 new homes, for example. Shared autonomous vehicles also

Innovation 25 Insider

JLL’s Rosemary Feenan transform how roads are used, impact journey times, and improve health and safety.”

For international architectural firm HOK, the elimination of cars from city centres and a shift to autonomous vehicles (AV) will drive a revolution in urban planning, transforming the way even roads are designed.

“AV will greatly impact and positively influence the built environment, especially the street edges, by establishing a more robust and extended relationship [between] the building and the street,” says Jerome Unterreiner, senior urban designer at HOK. “The current equation of the building sitting behind the sidewalk, with minimal influence, will shift to its playing a role in street design. This is a game changer for real estate.”

Unterreiner adds: “Visionary planning is the key to success. Plans will need to carefully consider how to transition to AV. The first moves are likely to offer tangible examples of how electric cars will benefit the places we live, work, shop and visit.”

AV in the public realm is not just blue-sky thinking — the city of Helsinki is three years into a 10-year plan to make car ownership unnecessary through ‘mobility on demand’ systems. As part of this, it is making pioneering steps with driverless public transport.

Unlike most of the rest of the world, Finnish law does not require vehicles on public roads to have a driver inside the vehicle. This has allowed the country’s public authorities to

“

Jerome Unterreiner: “The current equation of the building sitting behind the sidewalk, with minimal influence, will shift to its playing a role in street design.

This is a game changer for real estate”

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develop and test driverless ‘robobuses’, such as the Sohjoa driverless minibus, which has been operational since autumn 2016 in Helsinki, Espoo and Tampere. These cost- and energy-efficient vehicles can transport up to nine people, and operate alongside normal traffic and commuters.

“The robobuses offer a more flexible alternative to public transport when, for example, going home from the train station. The idea is to make public transport a more interesting option than taking a private car,” says Harri Santamala, Sohjoa project manager from the Helsinki Metropolia University of Applied Sciences.

Planning for AV also means making space for the technologies of the future, such as Hyperloop, conceived by Tesla’s Elon Musk to potentially provide land travel at airline speeds.

“Similar to transportation corridors, we should craft the AV network to connect and reinforce existing and planned projects as a complete system, replete with efficiency, delight and economic value for

both public and private infrastructure and development,” Unterreiner says.

“Hyperloop is fascinating,” Feenan agrees. ‘It’s about changing the travel experience. The idea would be to have Hyperloop stations in cities, like metro [stations], so you can make very quick decisions about travelling long distances. But in a future where we are trying to densify cities, for reasons of practicality and efficiency, there are question marks about shifting commuter belts even further outwards with these kinds of technology.”

Mobility is not the only issue at play in making cities fit for the future, Feenan adds: “Planning the cities of tomorrow is about the four Ps. They include property — the right buildings; platforms — the right city models; people — because smart is about serving citizens, and aiding happiness and health; and performance — using smart elements to improve efficiency and cost effectiveness.”

“

Rosemary Feenan: “Planning the cities of tomorrow is about the four Ps: property, platforms, people and performance”

MARCH 2018

MIPIM NEWS SPECIAL REPORT

Innovation 26 Insider

Aberdeen’s Hydrogen-powered bus Dijon has just launched the biggest-ever public open-data project in France, which will see it manage the city’s public facilities, with a particular focus on roads. A landmark contract has been awarded by Dijon Metropole to Bouygues Energies & Services (a subsidiary of Bouygues Construction) and Citelum (a subsidiary of EDF Group), with Engie and Capgemini.

The consortium is charged with the delivery and management, over a 12-year period, of a connected control centre for public facilities across the 24 municipalities that comprise the Dijon metropolitan area. In a deal worth around €105m, the project will manage traffic lights, street lighting, CCTV, and street and road maintenance from a centrally controlled point.

Meanwhile, the Scottish Cities Alliance — the collaboration between Scotland’s seven cities and the Scottish government — aims to use smart-city technology to transform Aberdeen, Dundee, Edinburgh, Glasgow, Inverness, Perth and Sterling into digital hubs. The objective is to enable the Scottish cities to become more internationally competitive and boost their economic growth.

By using open data, the programme plans to transform everything from street lighting and healthcare to public safety and the control of energy use to make life smarter.

© Grendelkhan

While much of the impetus is necessarily coming from local authorities, property developers and the private sector have an increasing role to play in the smart-city revolution.

As part of its Better Places 2030 corporate social responsibility (CSR) strategy, owner and developer Unibail-Rodamco has become a member of the circular-economy innovation platform of Paris&Co, the French capital’s economic development

Google’s driverless car

and innovation agency. The purpose of the collaboration is to identify and co-develop innovative solutions in the retail and real estate industries in order to create shopping centres that are more respectful of

SBA CALLS FOR OPEN SYSTEMS Emmanuel Francois, president of the Smart Buildings Alliance, believes the true benefits of smart buildings will only be visible when open systems become prevalent, and elements of different buildings can communicate with each other.

“The building industry has been very vertical, and it’s still that way to protect various business interests,” he says. “And that’s totally at variance with the IT industry, which is horizontal – it’s about sharing.”

The Smart Buildings Alliance is pushing the adoption of the R2S (or Ready 2 Service) standard – covering essential infrastructure systems like security, fire detection and access control – which recognises buildings that have adopted open systems. Already the headquarters of Vinci and ICADE are among the 15 properties in France that have been certified. “Now, our target is to expand worldwide,” says Francois.

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MARCH 2018

the environment and the context in which they operate.

For Achim Jedelsky, head of processes and IT at Daimler Real Estate, the parallels between the automotive industry and the property world are compelling. Both are being challenged to evolve in a moment of profound technological change. At a well-attended panel during last year’s MIPIM, Jedelsky noted that his company was already experimenting with blockchain technology and that the real estate industry should be ready to embrace such innovative solutions.

“At Daimler-Benz, we know how new technology companies like Tesla and Google have disrupted the industry,” he said. “The same can happen in the real estate sector.

It’s time to take this very seriously.

Innovation 27 Insider

SMART WORKPLACES

Changes in society, with rising generations bringing different requirements and expectations to the workplace, have combined with technological advances to bring about a revolution in the way office space is used.

Isobel Lee asks how property owners are reacting to these changing demands

From work space to meeting place © 2013 Ryan Gobuty | GENSLER

I

T IS nearly two decades since Google revolutionised the workplace with beanbags for meditating and ping-pong tables in the board room. But while offices are increasingly designed to serve workers in a smarter and more technological way, property owners would do well to stay focused on the human experience, suggests Mike Gedye, executive director at CBRE. “A smart workplace is an environment that provides the most convenience and ease for people to deliver their work, whatever that is, in a connected and collaborative way, enabled by technology,” Gedye says. “For many people, it’s about a technology-connected building that does all those things, but I think people come unstuck focusing too much on

“

Mike Gedye: “People come unstuck focusing too much on technology first and experiences second. Technology is an enabler, but it can also be incredibly complex for people who aren’t tech savvy”

technology first and experiences second. The best smart buildings are all about making it easier for the user to do what they’re striving to do, as opposing to making it more complicated. So sometimes that might not involve any technology at all — technology is an enabler, but it can also be incredibly complex for people who aren’t tech savvy. That’s an important thing to remember as we strive to improve the workplace experience.”

Peter Hensby, head of JLL’s European office capital markets team, has noted a similar pattern. “Over the last five years, there’s been much more focus on the workspace experience and its role in retaining talent,” he says. “At the moment, we are doing a lot of work with larger companies on their glob-

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Innovation 29 Insider

Manchester’s 20-acre Noma scheme al portfolio to help them future-proof their buildings, with a view to making sure they can adapt to the space requirements of tenants in the future. While this revolution was probably tenant-led, it’s becoming a landlord issue as well, to attract the right occupiers.”

Leading developers and property owners are already responding to the call with buildings that attempt to anticipate tenants’ needs, pre-fit out. Amsterdam-based OVG Real Estate announced in January that it was launching a company called Edge Technologies to develop office buildings that incorporate high-tech features as standard to make them smarter and more sustainable.

“We live in an age of innovation and transformation, but the real estate industry is largely stuck in the past,” says OVG founder and CEO Coen van Oostrom. “Buildings are the number-one polluters in the world.

We’ve begun collecting data that provides unparalleled insights into how people work. We’re launching Edge Technologies because we believe that buildings informed by these insights have the potential to do incredible things for our health, our creativity, our cities and, ultimately, our planet.”

Meanwhile, leading green developer Skanska is focusing on making its office developments entirely energy self-sufficient.

Its commercial development business unit in Central and Eastern Europe will be the first developer worldwide to cover office buildings with semi-transparent perovskite solar cells on a commercial scale, representing a significant milestone in zero-energy and carbon-neutral office investments.

By 2020, 80% of the world’s adult population will own a smartphone and the arrival of 5G data networks will start to drive workplace decisions based on connectivity, according to JLL. Meanwhile, by 2025, over 50% of internet traffic could come from internet-of-things (IoT) sensors, up from 11% in 2005, with the virtual and augmented reality markets predicted to be the size of today’s PC industry. The advisor also suggests that, by 2030, 30% of corporate portfolios will consist of flexible space, including co-working, incubator and accelerator space.

But the most successful buildings will continue to prioritise the human experience, according to Gedye. “The industry has moved away from a conversation about smart buildings being about how you run a build-

ing efficiently — ie, focusing on sustainability — to looking at the needs of the users,” he says. “Firms expect buildings to be green and equipped with the right sensors to run utilities, etc. The focus is now on user experience, engagement, productivity and wellness.

There’s been a huge shift from capitalism to ‘talentism’ — about using assets to boost the productivity and effectiveness of the people.”

The latest workplace projects are also typically better connected to the fabric of cities.

The £800m (€897m) Noma scheme near Manchester city centre, for example, spans 20 acres and, when completed, will feature 400,000 sq m of offices, homes, shops and leisure amenities, with a focus on the needs of the community.

A study commissioned by the Commission for Architecture and the Built Environment and the British Council for Offices found that employees who are proud of their work environment tend to value their company more, have a stronger belief in its brand and put more energy into their daily activities.

Another study by Exeter University’s School of Psychology found that employees working in spaces enriched with plants and artwork were 17% more productive than those working in spaces without.

The latest building certifications reflect this shift. UK REIT British Land’s latest project at 100 Liverpool Street in London, for example, is set to be one of the UK capital’s first shell and core WELL-certified buildings. The International WELL Building In-

“

stitute focuses on innovations to promote health and wellbeing through the quality of the physical environment and by facilitating healthy lifestyles.

This relatively new certification is changing the ways that offices are measured around the world. But property owners should still look beyond the numbers, advises Andrew McMullan, senior project designer and vice-president of HOK’s London office. “Certifications like LEED and WELL are not enough,” McMullan adds. “We must be deliberate in making astute observations about the workplace and how to best build a healthy, people-centric office. With studies that prove the psychological and physical benefits of exposure to nature, finding ways to connect to the outdoors will be key.

Workplaces will also integrate more into their local communities, providing public spaces and creating infrastructure that raises the quality of life for everyone, not just their staff.”

Despite this, McMullan predicts a long and healthy life for the modern workplace: “For years, many have predicted the death of the office — mobile technology allows us to work anywhere, so why do we need an office at all? Yet, as the world becomes increasingly more complex, the places we work have never been more relevant.

Work is a social activity and people still need places to come together to unlock the creativity and innovation needed to solve tough problems. Ultimately, I think ‘workplace’ will become ‘meeting-place’.”

Andrew McMullan: “The places we work have never been more relevant. People still need places to come together to unlock the creativity and innovation needed to solve tough problems” MARCH 2018

MIPIM NEWS SPECIAL REPORT

Innovation 30 Insider

BIM, BUILDING DESIGN

bash, bosh

BIM — building information modelling — is allowing designers to imagine buildings in new ways, and revolutionary new building materials are allowing them to turn those dreams into reality. Peter Clucas asks how this is changing the look and feel of our cities

© teekid / E+ / Getty Images

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B

IM, OR building information modelling, has been with us for a while.

The general principles are explained

by CBRE director Howard Vander Borght, who leads the engineering services, projects and design group. “BIM is a huge topic,” he says, “but it is essentially having a virtual model of a building running alongside the real thing. So all the various designers — structural engineers, architects, services engineers — design their elements, putting it together into an integrated model. The BIM model knows that a boiler is a boiler and a window is a window, not just a series of drawn lines. Attached to each object is data — everything you need to know about each one. In the design process, the model, along with the data, gets more defined. The whole idea is that the building gets constructed from the model information.”

CGIs and 3D printed models can be generated straight from BIM files. And because BIM works in three dimensions, the routing of services through a building is simplified, and the designer can create more complex shapes, knowing that the model and the design team can cope. All of this saves time and avoids errors later in the process.

Ian Bogle of Bogle Architects sees BIM “not as a ‘design tool’ per se, but more of a ‘collaboration tool’.” He adds: “We still sit around the table sketching on tracing paper before committing to the computers. However, as a way of quickly changing and challenging ideas to check against the reality, we see BIM as a progressive tool.”

Here is the fundamental advantage of BIM, perhaps. It takes a lot of the routine graft out of producing a set of plans and instructions for the construction of a building.

This allows designers to spend more time exploring options, thereby improving the quality of their work and the buildings we see around us.

Jonathan Allwood, director at architects Barr Gazetas, agrees: “It’s no secret that BIM’s greatest attribute is its ability to allow for greater cross-discipline communication: everyone is working off the same platform, with access to the same information. BIM allows us to design, test and visualise elements quickly in 3D. However, new forms or material options ultimately rely on the imagination and creativity of the people involved in a project, as well as the competency and skills of those around them.”

Innovation 31 Insider

So what is the future of BIM? CBRE’s Vander Borght is clear that there is still potential for growth: “Software packages are getting more sophisticated, so costings, calculations, buildability and programming can be undertaken by pulling the relevant information from the BIM model. When on site, the builder knows where everything should go and how it fits together. iPads can be taken on to site to provide information to the operatives. There is much more scope for prefabrication and automated construction tools.”

Already, GPS-enabled earthmovers can prepare a site direct from BIM information — a small example of the convergence of technologies. The next step in the process could be that BIM remembers what went well and guides the design process accordingly. So could artificial intelligence (AI) take over and make designers redundant?

Barr Gazetas’ Allwood thinks that this could happen: “A world where intelligent machines do everything from managing building systems to delivering your lunch via drone is closer than we think. BIM is critical to the integration of AI into design and construction, and much of the software and processes already heavily rely on a degree of built-in intelligence. As this continues to evolve, AI and BIM will deliver greater and greater efficiencies, allowing architects to expand the boundaries of how we design, construct and, most crucially, occupy buildings.”

“

Ian Bogle: “The best designs come through collaboration, communication and human interaction. BIM can facilitate the process, but it shouldn’t be the starting point”

“

Jonathan Allwood: “A world where intelligent machines do everything from managing building systems to delivering your lunch via drone is closer than we think” Bogle, however, strikes a note of caution: “AI is an interesting proposition. Could buildings design themselves? I hope not, because the best designs come through collaboration, communication and human interaction. BIM can facilitate the process, but it shouldn’t be the starting point.”

© Godruma / iStock / Getty Images Plus

So it would appear that BIM is allowing more focus at the design stage. This must have a positive effect on the quality of the buildings and spaces that make up our towns and cities. But there is a problem. The idea of BIM is to link all stages of the process and, at the moment, the connection between design and construction companies is patchy.

For Bogle, this is not a major issue: “As an international practice, we collaborate with other architect practices around the globe and the single BIM platform has certainly helped in the communication and transfer of information between our studios and local engineers. We are seeing more and more cost consultants adopt the BIM platform and this can only improve costing accuracy. But you still need a few grey hairs to ‘price’ those unknowns that only come with experience.”

But a warning comes from Daniel Ratcliffe, associate in the building and project consultancy team at Savills. “We are seeing BIM reach further through the supply chain as its adoption grows,” he says. “So, if you are in the property and construction supply chain and you are not using BIM, either now or in the near future, you may soon be left behind.”

Ratcliffe sees contractors becoming more experienced in delivering BIM benefits and investing in both technology and staff in order to respond to the market. “Steel fabricators, and mechanical, electrical and plumbing subcontractors are today the most proficient with BIM,” he adds. “This is understandable, because of the accuracy and efficiency of their work.”

He does concede that contractors are also embracing, rather than shying away from BIM as it reduces overall risk in construction and can provide better quality outcomes.

MARCH 2018

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Innovation 33 Insider

BUILDING TECHNOLOGY

Getting on board with the future

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From solar tiles to buildingmanagement systems, technology is opening up new possibilities for the ways buildings operate.

Peter Clucas looks at some of the more innovative products on the market

S

WISS architect Le Corbusier famously described houses as machines for living in. This statement holds truer than ever as technology takes over the control of our buildings.

And that progression is not limited to houses — all building types are becoming more responsive to technology. Building-management systems are able to control more features; humans, fewer.

Whether for the comfort of occupants or for optimising the performance of machines and processes, the purpose of buildings is to create the right environment.

With the recent acceleration in environmental awareness, it is imperative that this is done with the minimum use of the Earth’s natural resources. As a result, we are seeing a convergence of technologies.

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Innovation 34 Insider

Jennet Siebrits, head of residential research at CBRE UK, is monitoring an installation in Bird Street in central London. The centrepiece of what is billed as the world’s first ‘smart street’ is Pavegen, paving stones that convert the kinetic energy of pedestrians into electricity.

“Each tile is equipped with a data transmitter to capture wireless information from every single footstep, which can be used to analyse consumer patterns and behaviour,” she says.

At Europe’s busiest shopping destination, London’s Oxford Street, 20 sq m of Pavegen’s flooring technology is capturing kinetic energy from footfall and converting it into off-grid electricity to power lights at night and bird song during the day. Siebrits says: “The energy-harvesting walkway also incorporates Bluetooth low-power transmitters to enable it to interact with branded apps and provide the clients, New West End Company and Transport for London, with data on how busy the site is.”

Solar tiles are another recent innovation from carmaker Tesla. In these, the photovoltaic cell that collects solar energy is fully integrated in an actual roof tile, rather than taking the form of a separate panel. Glass solar tiles are so durable that Tesla will warranty them for the lifetime of a house.

The internet of things (IoT) is a major driver of change. Electronics giant Intel describes the IoT as “a robust network of devices, all embedded with electronics, software and sensors that enable them to exchange and analyse data. The IoT has been transforming the way we live for nearly two decades, paving the way for responsive solutions, innovative products, efficient manufacturing and, ultimately, amazing new ways to do business.” In buildings, IoT allows occupiers to control an array of features within a building.

Pavegen paving stones convert the kinetic energy of pedestrians into electricity

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“The IoT has been transforming the way we live for nearly two decades, paving the way for responsive solutions, innovative products, efficient manufacturing and amazing new ways to do business”

Daniel Ratcliffe, associate in the building and project consultancy team at Savills, sees a link between design teams and those who run buildings. “Facility managers are becoming more familiar with BIM [building information modelling],” he says. “We are seeing them providing input to development managers as they develop their BIM strategy for new schemes, especially when asked what they see as essential built-asset information for the on-going efficient and effective use of the property. It’s the [property] circle of life.”

This is encouraging because, historically,

facilities managers have had little influence on the design of the buildings they manage.

CBRE director Howard Vander Borght agrees: “We are currently looking into how the BIM information and platform can be used when owning and operating a building. Software is being developed by some companies, but not much is currently available. However, it is the future and we should be getting on board with it.”

But who — or what — should have control?

The logical pathway would be for facilities managers and building-management systems with artificial intelligence (IBMS) to work out which settings are right under which conditions. Conversely, buildings could respond to individual occupiers’ demands through apps on smartphones.

Ultimately, productivity, wellbeing and energy efficiency need to be balanced. And in the workplace, productivity and wellbeing are notoriously difficult to measure. Occupants always crave control, and handing the reins over to computers never goes down well. As automation develops, there will be a need for actual or perceived control by the people in the buildings, while intelligent systems work behind the scenes.

Innovation 35 Insider

INNOGY INVESTS IN INNOVATION

Now the photovoltaic cell that collects Solar energy can be fully integrated into the roof tile

But there is a potential problem. We are reminded of the car industry and how predicted performance and emissions levels rarely seem to match reality. Apart from false reporting, which may have happened, much is dictated by driver behaviour and traffic conditions. Although buildings are normally static machines, they are highly complex and there is not one driver — there may be thousands of occupants.

“For the last 10 years, the focus of sustainability was on energy efficiency,” says Alex Edds, UK director of innovation at JLL. “We were saving heat, water and costs. But that only went so far. There is now a gap between intention and actual performance.”

He points out that how a building is used may result in different performance figures from those that were expected or possible.

In view of this, much more data is needed about actual performance, which can be compared with predictions and capacity. In this way, new buildings can be better designed and they can be managed more effi-

ciently. This is where building-management systems take a lead role. As they become more sophisticated, they can begin to bridge that gap. But where do we get the data?

Edds cites the Australian government as a prime mover in this field. Its Energy Efficiency In Government Operations (EEGO) policy requires occupiers to monitor their environmental performance and incentives are in place to make sure they constantly improve it. The data gathered is analysed and can be fed back into the design of the next generation of government buildings.

In summary, the two fundamental questions are: what can be controlled and what, or who, will control them? Resistance to driverless cars indicates that some of us still mistrust technology. Whether we see a building as a simple roof over our head to be personalised or as a sophisticated machine that knows what is best for us is a debate that will run and run. But ultimately, the human factor is likely to counter the instinct to automate all aspects of managing buildings.

CLAUDIA Häpp leads the Smart & Connected initiative at German energy giant Innogy. She believes better use of data is key to unlocking efficiencies in the real estate industry: “It’s about three things,” she says. “Firstly: many of our customers in the real estate business are confronted with information silos. These have to be overcome. Currently, there is no or limited information exchange from planning through construction to building management. Different parties work in silos, which leads to quality, time and cost issues.

“The architects have their own software and deliver a lot of paperwork. The construction companies have their own systems and processes. The same with the facility manager.

If all of them had access to the same data, it would be much easier to take care of a building and to maintain it. It sounds very simple, but currently it is not.

“Secondly: the low degree of digitisation in building management creates huge potential.

We have not yet learnt to see them as smart organisms. As a result, productivity growth within the construction industry is lagging most other industries, as a McKinsey study revealed last year.

“The reason is straightforward: the life cycle of many buildings is so long that they’ve not yet entered the era of digitalisation. And so far there hasn’t been a great need: the demand for buildings at least in most urban areas of the western world is so high that you can usually find tenants or buyers without modernisation.

But that will change in the years to come.

“Thirdly: buildings produce such a large amount of data that if exploited could raise living standards and make them much more efficient and safer.”

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Alex Edds: “For the last 10 years, the focus of sustainability was on energy efficiency. But that only went so far. There is now a gap between intention and actual performance”

Innogy Smart & Connected’s Claudia Happ

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Innovation 36 Insider

PRODUCTS AND SERVICES

Innovation showcase A selection of the innovative products and services on show at MIPIM 2018

NUKI Smart-home innovator Nuki has received funding from leading global security products and solutions provider Allegion to accelerate its growth.

The Nuki Smart Lock, which is easily installed on top of an existing key and lock, offers Bluetooth-enabled smartphone and Nuki Fob credentialing and fits the majority of existing European locks. When used with the Nuki Bridge, it provides permanent internet connectivity and homeowner control from remote locations. With the Nuki Box, which is the latest addition to the company’s product portfolio, entrance doors of multi-family housing become smart access systems.

Nuki CEO Martin Pansy says: “Our leading residential lock is smart, simple and secure. We’re excited to collaborate with a partner like Allegion, and we are convinced that we can shape the future of smart access together.”

HABITEO Launched in June 2014, Habiteo.com is a site which allows purchasers to visualise new real estate in 3D allowing the user to project and make an appointment in a few clicks.

Habiteo has developed a unique and innovative technology that allows internet users to choose and visit in 3D their future apartment as if they were there. They can discover the residence, check availability in real time, visit the neighbourhood, and find all the practical information about the city. Habiteo is also a 100% digitised customer journey and a personalised offer. In a few clicks, customers can arrange an appointment to live or invest.

With more than 1.2 million visits in 2016, Habiteo.com stands out as a key player in new real estate.

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Innovation 37 Insider

EQUIEM The growing community at Lend Lease’s International Quarter London is benefitting from a world-class customer experience thanks to a newly launched partnership with Equiem, the global leader in tenant engagement solutions for real estate.

A fully integrated tenant engagement platform will provide news, events, local area information, wellness programmes, convenient services, competitions, offers, and more, exclusive to occupiers of International Quarter London. It will utilise Equiem’s platform to support a branded, customised web app, a tailored engagement and services programme, and a community manager based at IQL. International Quarter London will be the first project in the UK and Europe to deploy Equiem’s engagement platform, which is currently in use at over one hundred premium commercial, retail and mixed-use real estate assets globally.

SECONDESK Gecina has launched Secondesk as a complementary solution alongside traditional offices in response to new workplace practices, notably marked by the digitisation of tools, the growing numbers of mobile staff and the development of more collaborative methods.

The development of Secondesk has enabled Gecina to enhance its range of workspaces, meeting its clients’ needs for flexibility and services. Secondesk is being adopted not only by co-workers and very small businesses, but also by staff from major companies looking for flexible real estate solutions to host their teams for specific projects or in response to strong growth in their business.

The latest site opened at the start of January 2018 at 159 avenue Charles de Gaulle in Neuilly-sur-Seine. It offers 2,200 sq m of co-working and private office space and is already nearly 45% let.

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