Real estate firms are having to quickly adapt to a rapidly changing environment as new technologies continue to challenge the industry’s conventional thinking, said panelists at today’s PERE Europe conference in London.
The discussion ‘The Future of the Built Environment’ was moderated by Richard Urban of Rivington Pike, and included Edouard Fernandez from EQT Real Estate, BlackRock’s Marcus Sperber, Russell Platt of Forum Partners, and Mark Gilbreath of LiquidSpace.
The discussion quickly turned to the growth in recent years of the sharing economy, and the rise of the likes of WeWork, Uber and AirBnb.
“The ‘sharing economy’ is on the rise. People, particularly, millennials do not want to buy things like cars and houses, they just want rent and borrow,” said Sperber.
He added that, in a break from convention, technology specialists now made up around one-third of his firm’s staff. “We are also investing in a huge amount of technology. This is a huge change from the last decade. We are also investing in fintech companies and crowdfunding firms – these are the organizations that are changing the landscape,” said Sperber. “The first question I ask graduates now is, ‘Can you code rather than can you value an asset?’”
Social media and business websites are now being used by real estate companies to improve the way they think about traditional assets. “We are now using Facebook to evaluate real estate trends by examining patterns about how and where people use retail or office or leisure assets,” said Platt.
Sperber, meanwhile, added that BlackRock had joined forces with LinkedIn: “Our research has discovered that companies like LinkedIn know more about our employees than we do, which is frightening.”
Fernandez suggested that the nature of the assets is also shifting. “There has been a change where real estate is not seen as an asset, but as a service,” he said. “It’s harder to differentiate yourself through quality, so you have to do it through the customer experience.”
Sperber concluded the discussion by comparing real estate to the stone age. “The stone age didn’t end because they ran out of stones, and the same applies to the real estate world – we are not going to run out of assets, we are just going to have to adapt to a changing environment.”
PERE Europe, a one-day conference, is being held at the Royal Arts Society, in central London.