A real estate revolution
The real estate sector is at an exciting juncture. Disruption is bringing the opportunity to reduce risk and improve whole-life asset performance, and fundamentally deliver better outcomes for occupants, owners and end users.
Across the sector, there are major competitive advantages at stake for the occupants, asset owners, operators, consultants and contractors that embrace and drive forward this transformational change.
Sustainability, for example, is one pressing factor set to disrupt portfolio strategies and supply chain engagement in the years to come. Globally, our buildings and the construction industry are responsible for almost 40 percent of carbon emissions. Cities and organisations across the world – including London, Tokyo and New York – have already signed up to the Net Zero Carbon Buildings Commitment to decarbonise their new and existing building stock by 2050, but this must be only the start of the industry response.
In the UK a shocking seven tonnes of waste is sent to landfill for every home we build.
We need to strive for better and more efficient outcomes. In Construction 2025, the UK Government outlined aspirations for industry to achieve a 33 percent reduction in construction cost, 50 percent reduction in project time and 50 percent reduction in greenhouse gas emissions.
These are challenging targets and can only be achieved with radical change in how the industry operates and delivers – a real estate revolution.
Too much of our real estate – homes, schools and offices – is still individually designed and this lack of standardisation in materials, space allocation and building techniques is incredibly inefficient.
Technology and sector innovation
Embracing a manufacturing mindset and modern methods of construction is critical to delivering better performance, but also heightened environmental standards and a higher quality end product.
Switching to offsite manufacture and modular construction means component parts can be produced in controlled, factory environments and in safer working conditions. While adoption of these new methods and manufacturing techniques was slow to take off initially, we are seeing considerable and well-publicised investment in this area as clients and contractors recognise the huge efficiencies that can be harnessed.
Grasping the full potential of digital technology is also key.
Leveraging tools such as building information modelling (BIM), machine learning and blockchain throughout the supply chain has the power to radically transform real estate operations. For instance, blockchain will not only overhaul payment and delivery practices, but will soon allow consumers and clients to monitor the movement of materials and scrutinise levels of ethical sourcing.
Collaboration is another area where the industry must evolve to thrive.
A shift in working culture and models is urgently required to break through the historically fragmented nature of the construction and ensure aligned goals and integrated supply chains.
Adopting consistency in measurement methods and sharing data across the sector is paramount to benchmarking performance and driving better design, delivery and operational standards.
Disruption is upon us and the opportunities presented by it are seismic.
The old ways of working are no longer fit for purpose and cannot keep pace with changing consumer demand, societal pressures and economic realities.
As an industry, we need to be on the front foot to embrace it and there are significant commercial advantages at stake for those that do. And yet the effects of transformation will be felt far beyond the real estate sector. Modern methods of construction, digital innovations, greater industry collaboration and improved asset performance will ultimately deliver enhanced social, environmental and economic outcomes for the communities we serve.