The real estate industry must transform to meet the needs of people and cities over the next decade, according to a new report released today by the World Economic Forum. COVID-19 has exposed vulnerabilities across the real estate sector, ranging from indoor air quality issues to oversupply and accelerated underlying demand factors, which must be addressed for buildings and cities to be addressed. be healthier, more prosperous and more sustainable.
The World Economic Forum‘s new report, “A Framework for the Future of Real Estate,” serves as a roadmap for industry change. Developed with the CEOs of Global Real Estate, the framework provides a pathway for transforming buildings and cities to become livable, sustainable, resilient and affordable.
“Real estate stands at a crossroads as cities adapt to the new realities of the post-COVID era, climate change and the Fourth Industrial Revolution,” said Jeff Merritt, Head of IoT and Urban Transformation at the World Economic Forum. “This real estate transformation – and the market disruption that comes with it – is long overdue, but if fully embraced, it promises to help us all live healthier, happier and more connected lives.
“Today, the real estate industry faces challenges and therefore has the opportunity to do better, take more action for a healthier future and have a lasting impact globally,” says Coen van Oostrom, Founder and Managing Director, EDGE, OVG Real Estate. “To optimize buildings, we must not only rethink spaces, user behavior and energy efficiency, but also put more emphasis on redevelopment opportunities, the circular economy and digitization. Let’s stop waiting for others to lead by example and start today, making a daily commitment to making incremental change. Ultimately, we need to keep an eye on the bigger picture to be the leaders in the transition to a more sustainable way of operating. “
For more than a decade, the real estate sector has experienced exceptional profitability with successful growth rates and increasing investment volumes with compound annual growth rates of + 14%. This success initially put less pressure on industry leaders to innovate, but now the industry is under pressure from consumers, investors and regulators to better serve health and resilience. of their communities. At the same time, the lasting effects of the pandemic and the acceleration of existing trends have brought the industry to a tipping point.
“The pandemic has accelerated the changes in work and lifestyles that have already accelerated in recent years, thanks in large part to new technologies,” said Christian Ulbrich, global managing director and president of JLL. “As we anticipate a sustainable global post-pandemic recovery, this framework from the World Economic Forum shows how our industry has a vital role to play in coming together to shape the future of real estate for a better world.”
The Future of Real Estate Framework identifies key catalysts that real estate leaders can use to ensure they are working across the industry to deliver real estate options that are livable, sustainable, resilient and affordable.
- Accelerate digitization and innovation to sort everything from construction costs to the occupant experience
- Value-tested business cases that are transparent and demonstrate a clear return on investment in technology, sustainability and affordable housing
- Prioritize talent and knowledge by improving the skills of existing workers and attracting talent dedicated to innovation areas while ensuring diversity and inclusion
- Involve stakeholders, throughout the industry value chain and within the local community, to ensure that projects are mutually beneficial
- Ensure regulatory frameworks effectively address procurement challenges, sustainability goals and provide appropriate zoning and density
The framework also includes case studies from various real estate companies and illustrates the vision of the four key pillars of livable, sustainable, resilient and affordable buildings and cities.
Industry leaders have already taken decisive steps to transform the entire real estate industry. Gensler’s GC3 commitment aims to achieve net zero by 2030 across all Gensler projects and JLL’s work with the Washington Metro will provide clean energy to more than 1,500 homes.
Swire Properties has joined the Business Ambition for 1.5 ° C campaign and Lendlease is committed to leveraging digitization to become net zero carbon by 2025 and absolute zero carbon by 2040.
Majid Al Futtaim became the first and only conglomerate in the world to achieve LEED Platinum certification for its entire hotel portfolio.
Signify has embraced sustainability and resilience by developing and deploying UV-C disinfection systems, an energy-efficient and chemical-free way to disinfect buildings.
Schneider Electric has set clear and measurable 2025 objectives around sustainable development to achieve 80% green revenues, deliver 800 million tonnes of saved and avoided emissions to their customers and ensure that 1,000 of their main suppliers reduce emissions. emissions of 50% of their operations.
Lessons learned from the initiatives of these companies and many others have been used to help develop the framework for the future of real estate that aims to accelerate these types of transformations in the industry.