This isn’t an acceleration, it’s a revolution

An Experiment on a Bird in an Air Pump by Joseph Wright of Derby, 1768

The office real estate industry is set to be transformed. 

In the world of work and the workplace there is a fundamental misunderstanding going on. Many people are talking about changes to how we work, post pandemic, as being merely an acceleration of trends that were already underway. They are not. In fact, we are witnessing the start of a revolution that will utterly transform the dynamics of the industry.

Pre pandemic it is true that many companies had adopted a smattering of remote working and working from home. In a city like London it was common for many employees to only be in the office 4 days a week. And then the pandemic hit, and we all (with caveats of course) moved to five days a week working from home. A year later the common refrain is that when we return to the office we will adopt some form of hybrid working, where some are in the office and some not. A smorgasbord of working patterns will emerge.

And this is where the misunderstanding will rise up and cause chaos. Because we are thinking this is an acceleration, we think it's just an iteration of the way we worked, and companies operated, up to March 2020. Everything stays the same but we throw in a bit more flexibility and remote working. After all, haven’t we all been working like this for a year or more?

No is the answer. Today we are all working remotely, so the expectation is that everyone is easily contactable because they are at home. But when we return, and go hybrid, we will not know where anyone is. They might be at the office, or they might be at home, or in a coffee shop, a local flex space, a hotel, or a clients office, or wherever. And here the chaos begins. We could function easily remotely because all being at home was like all being in the office. We’d just reconfigured life as it was, as a fundamentally office centric company. Nothing really had changed. Hence the idea of an acceleration, just a bit more of what we were doing anyway.

But this is no acceleration. It’s a revolution. We are going to be moving from being office centric companies to WFA (work from anywhere) companies. And that cannot happen without major, disruptive, change.

Just look at the headlines about Zoom fatigue, back to back video calls, the merging of home and the office (‘I live at the office’ etc), an inability to turn off, to separate home and work life. These are all the consequence of the ‘acceleration’ misunderstanding. They are what happens when an office centric corporate way of live moves, en masse, out of the office. We are working to the same patterns, but somewhere these patterns should not be. It’s bearable when we are all in it together. It will cause chaos when we are not.

The revolution coming will be the result of having to change how we operate, as individuals, and as companies, when we move to hybrid working. When should we be in the office, when somewhere else, and where somewhere else? Who’s going to bring in and bring on new employees, who’s going to mentor them? Most of the senior management team are more than comfortable working mostly from home, whereas those in their earlier working lives want to be ‘in town’, not least because they are going out after work. Is the office just somewhere for the young? What about culture? That used to be understood through the acquiring of tacit knowledge, from just being around and seeing how things work. But people aren’t around so much now, and work is being done out of sight.

In every aspect of company life, being structured as an office centric company whilst not being in the office, is going to give us the worst of all possible worlds. No serendipitous meetings, no water cooler meetings, no overhearing that nugget of information, no learning from observing. During the pandemic it was fine. We knew where people were and we could get hold of them immediately. Even if that meant endless Zoom meetings, longer days, no separation of life and work, that’s what we did. Because in the office we could do this. See anyone straight away, tap them on the shoulder, disturb their flow, talk too loudly and ruin their concentration. Yes, everything we did was synchronous. I want to know this now. I want, I want, I want….. now.

It’s just not going to work is it? If we go hybrid post pandemic we need to rethink everything about how our companies work and operate. We need workflows that suit the way we work. And those office centric ones simply won’t cut it anymore. And, as we will see, our real estate won’t cut it anymore either. We are about to blow up the real estate industry. Without realising it.

Where to start? As Steve Jobs famously said ‘you have to start with the customer’. Within our companies, to understand what we need from our offices, those customers are our employees. Without knowing and understanding their needs your future office plans will be dead on arrival.

For every employee you need to first understand what it is they do, what are their ‘Jobs to be done’. Their job will be made up of various tasks, and each task will have an ideal working environment. Each task will also have other dependencies, such as the need for particular software, hardware or services. And, of course, each task will either be able to be carried out alone, or will require the presence of other people. Map these out for all your employees.

From data can flow action. With all this information you will be able to answer those questions about who needs to be where, and when. And what data they need access to, from where they can get it, and where does it need to go after they are finished with it. And from all of this it will become clear what systems you need, and what ‘jobs to be done’ need to be done synchronously or asynchronously.

This is how to think as a hybrid, non office centric company. Get this data analysed well and it will inform so much about how you need to operate. Not least of all it will transform how you think about your office needs. Almost certainly this will involve a realisation that you need less but better space (for which you will probably have to pay more), most likely in diverse locations and procured on different terms. 

I would wager it would convince you that henceforth you should be thinking about ‘Space as a Service’, where you purchase what you need, when you need it. And that might be five days a week, or it might be 1 day a week. What you consume needs to reflect what the needs of your ‘customers’ are, your employees. Your aim is not to have to think about real estate, your job is to enable your employees to be as happy, healthy AND productive as they can be. You want to be people centric, not office centric.

When the above occurs, as it will, the current business model of the real estate industry falls apart.

The way it works today, and has done for decades, is that the customer of a developer of office space is not the occupier, but the investment community. Buildings get funded (largely) by long term investors, like Pension funds. They want income streams that are secure, steady and reliable. They don’t want risk, and they certainly don’t want any out of the box innovation or new thinking. They want to buy a Bond. And for decades that is what the industry has delivered. Buildings where large sums of money can be parked, secure in the knowledge of quarterly rents being paid.

See the problem? Given what we’ve discussed about what companies (occupiers) need in the future, these two requirements are about to clash. One wants steady inflexibility, the other dynamic flexibility. One side is not going to get what they want.

Hence the coming revolution. Because there is a confounding variable which tilts the balance strongly in one direction, that of the occupier. And that, of course, is that over the last year, with probably another 3-6 months more to go, almost every knowledge company (aka office centric company) has realised that they can, should they need to, run their businesses away from their offices. To many it has come as a huge surprise that that office they felt was an essential need, is actually not as needed as they thought. It is very likely that they still want an office, but want is a different driver to need. Things you want but don’t need demand different terms.

And flexibility is what the non office centric company needs. It is well known that flexibility always comes at a price but when it comes to real estate, for a company, flexibility probably trumps price.

So what happens now? Is the elephant in the room being addressed? I think not. The investment community is wedded to a business model that suits an increasingly diminishing section of the market. The real estate leasing industry is still, mostly, talking of occupier needs for workspace that don’t tally with reality. Or at least the post pandemic reality that is lurking unseen. 

There is a square that needs to be circled. Structurally the industry is not shaped to provide what the customer wants anymore. As long as we pretend that what is happening in the market is just an acceleration of existing trends we can sleep tight and ignore the brick wall we are careering towards. But if we open our eyes and understand that the days of office centric companies are over, we can start planning for the revolution underway.

People are not, by and large, going to go back to being inmates of white collar factories. They want something better. They need something better. And, given time, they will get something better. But it’s not going to just happen.

Something always sparks a revolution. That spark will light when we ‘return to the office’. And discover, it’s no longer fit for purpose.

CBRE & Industrious - The Chicken and the Pig

Head and wings of a fantastic bird. 1507-19 Albrecht Durer

On the 22nd of February it was announced that CBRE had bought a 35% stake in Flex space provider Industrious for circa US$200 million in cash.

In addition to the cash CBRE will be transferring their own 10 location flex brand Hana to Industrious.

What does this tell us? 

It tells us that CBRE is a chicken, and Industrious is a pig.

I have a lengthy presentation about #SpaceAsAService, and in this 8 factors critical to success are defined. No 1, in the prime spot, is a slide that asks ‘Are you a Chicken or a Pig?’. This riffs on the joke about ‘What is the difference between a chicken and a pig in a bacon and egg sandwich? To which the answer is ‘one is involved, but the other is committed’.

The reason it is in the No 1 slot is because whilst it does not matter which you are, if you are going to be an operator of flex space you have to be a pig. Operating flex space is too complicated, and too much a mission, for it not to be central to your core business.

For a giant brokerage like CBRE Hana was never going to be core. Yes they had the clout to throw a lot of money at it, but without it being something they invested real, from the core, commitment to, was it ever going to succeed? Their core, transactional business would definitely benefit from having ‘skin in the game’ of the flex market, enough so that they deeply understood the dynamics of the sector, but strategically the much better option, by far, is to do so via a true ‘pig’ company like Industrious. 

Where this leaves other real estate services companies is interesting. Has the  Hana experience 100% invalidated any of them them trying to launch their own flex operations? Probably. So what should they do?

Last year I criticised another real estate services company partnering with an operator, on the basis that they should be buying at least a decent sized stake instead. If they executed their partnership well buying a stake would become almost an inevitability, but by then it would be much more expensive. The ownership stake itself would provide the incentive to execute well. Put some ‘skin in the game’. And save yourself a fortune.

The CBRE situation has, I think, validated this argument perfectly. The pandemic may have done this particular company a favour, in postponing their partners growth trajectory, but if I was them I’d be coughing up for that meaningful stake asap.

Where this gets interesting is in thinking about the position of landlords. Covid is clearly a near term ‘bug’ for the flex industry, but it is a massive long term feature, as the demand for flexible space is set to grow enormously. To the size that every landlord, even every prime multi let office building, will need to offer flex options. 

To date some landlords have been building their own offerings. But are these efforts even nearly enough? Are we dealing with chickens or pigs. I think most definitely the former, as with CBRE. The ‘skin in the game’ is trifling, even for pre pandemic conditions. For post pandemic demand orders of magnitude off.

So. What to do now? Current plans are too little. Is internal commitment lacking as well? The flex sector is becoming core, or at least a critical component of any serious, scale landlord. So ‘Pig’ behaviour is needed. Are they up for that? CBRE said they were with Hana. But they weren’t. Perhaps, given the way the real estate industry is structured, that was, and will be, an inevitability.

It’s make your mind up time. Landlords that are building out their own flex operations need to up their commitment 10X, or they need to make plans to back out immediately, and work on Plan B. Which is to decide who their target customers for flex space are, then pick a range of truly committed partner operators (because different customers types require different brands and value propositions). Then they need to align the incentives between themselves and these operators. By buying meaningful stakes!

The Redundancy of Real Estate - and how to avoid it.

On November the 10th, Apple unveiled its new M1 System on a Chip. A processor so fast, and so abstemious in its power consumption, that it has in effect blown up the laptop PC industry. The new $999 MacBook Air is as fast as a $6000 MacBook Pro of 3 years ago. And this is the entry level processor. Over the next two years larger, more powerful versions will be developed to power the entire Apple range of computers.

And with this the Intel based era of computing will come to an end. For sure, Intel will still be a huge company for years to come, but its dominance has been eradicated, just like that. As John Gruber the technology commentator has written ‘The M1 Macs are such better machines than their Intel-based predecessors it’s hard to believe.’

During the same month we have seen the announcement of not one, but three, new vaccines to counter Covid-19. Each developed in less than a year, a feat of extraordinary brilliance, as the norm for developing vaccines is measured in decades not years.

And these ground breaking technological developments have taken place during a global pandemic where almost every knowledge worker is working from home. And where the process of development has spanned many countries, and continents. Extraordinary feats of intellect, #NoOfficeRequired.

Which tells us what?

Well, according to many in real estate, not a lot. Repeatedly I come across comments online about how ‘offices are needed for creative work’ or ‘relationships need physical proximity to build’ or ‘you cannot innovate sitting on the sofa’ or ‘we’re all surviving on relationships we had pre Covid’.

Some go even further. Stephen Bird, CEO of Aberdeen Standard Life was recently quoted as saying “You cannot change the world from home, It’s an absolute falsehood. It’s lazy thinking, it lacks courage and it’s delinquent on the next generation.”. Not someone from real estate admittedly but I get the feeling many in our industry would agree with him.

It’s hard to know where to start in explaining just how dangerous and deluded such thinking is, but I think it all stems from a lack of awareness of technological progress combined with poor personal digital skills. People are talking about things they know little about. Taking advice on driving from someone who doesn’t drive makes no sense. And we shouldn’t do it.

Working in a distributed company is not the same as working in an office centric one. It’s never the case, long term, that you can move to being a distributed company by simply moving people out of the office, but maintain the same policies and practises as you had before. 

Starting in March this is what most of us did, and by and large, it has been a remarkable success. Every credible survey of remote working (under pandemic conditions) has shown that for the majority of people, perhaps 70-75%, it has worked, and worked well. For the balance it very much has not. And it has become clear what it is we miss, and don’t miss, from our old, more office based lives. For more on this please visit leesmanindex.com, where they have a wealth of detailed analysis.

We are now though at a crunch point. We’ve been working, by decree, remotely for eight months or so. Long enough to realise that the old ways of working, based on 4/5 days a week of physical proximity to our co-workers, are perhaps not the best way to operate, when apart from each other. Hence complaints about too many Zoom meetings, long hours, burn out and lack of connection. Adrenaline got us through the first few months, but now we need something different.

It’s not working remotely that is the problem, it’s not knowing how to work remotely. And the biggest problem of all is when management doesn’t know either. That’s when we start getting comments about ‘you cannot do XYZ at home’. Better stated they would be saying “I cannot do XYZ at home”, because that is the real issue. When managers do not know how to manage remote teams, problems start to arise.

We need some training.

Take a look at the tech companies. Twitter have told their employees there is no need to come back to the office, Google & Facebook have said don’t bother till mid 2021. Gitlab & Automattic both employ over 1200 people, across 60+ countries, but neither have any offices. Box say work anywhere till 2021, and then we’re going hybrid. Dropbox is going ‘Virtual First’, as is Shopify. And on it goes.

Each of these companies are amongst the fastest growing, most valuable companies in the world. With many of the highest paid employees. And they’ve moved to being distributed with hardly any issues. Why? Because these are digital first companies, where technology is used throughout every process, workflow and project. Where data is in the Cloud and everyone is equipped with quality hardware, software and services that enable pervasive communication and collaboration. Where work has mostly gone asynchronous, and interaction is mainly through a wide range of online SaaS (Software as a Service) tools such as Slack, Trello, Asana, Jira, Workday, Notion, Miro and Mural. In short, where all the things many real estate people say are only possible in the office, happen outside an office.

We need to learn from this. We need to adopt some of these tools, become familiar with how truly digital companies work, and how they think, and how they communicate, and mentor, and learn, and innovate. Because these types of companies (and they will increasingly not be confined to tech companies) can be super efficient and blindingly effective. If your company comes up against such an organisation you better be prepared for some serious competition, because as digital native companies they will be, ceteris paribus, hard to beat.

None of which is an argument for ‘the office is dead’. Tech companies are different to non tech companies but even they will still be taking a lot of space. Less than they probably would have pre-Covid but still plenty of it. And offices are still the best places for certain activities. And most companies will take office space, subject to it being designed and managed in a manner that actually delivers value. 

But as an industry we must stop kidding ourselves that our customers need an office, that without an office they will not be able to innovate, or collaborate, or share knowledge, or grow. All of these things are possible with #NoOffice. Our job is to demonstrate why they should WANT an office. Why having an office enables them to do some things better than they could without an office. And more particularly why this office is better than that office. Without real differentiation we are just commoditised box builders. When your customers no longer need your product your Brand, what you stand for, becomes the most important asset you have. As I have said before, real estate is no longer about satisfying needs, it is about creating desire. 

So lets get moving on up-skilling our industry. Let’s stop talking like analogue dinosaurs. No more ‘you can’t do XYZ online’. You can do everything online. Let’s learn the tools our digital customers use. Let’s grasp that real estate comes in many forms, and that ‘the office’ is going to mean something different in the future. Wherever our customers want to work, we need to be there. We need to give them what they want, not what we have to sell. We need to think like they do, act like they do, and innovate like they do. 

If we want to attract the best customers, there really is no alternative.

Old work is leaving the building–The Future of the Office

I did a webinar for global members of SIOR in May 2020.

Quite provocative…..

Talent and the Real Estate Company of the Future

Winter Landscape with Ice Skaters, Hendrick Avercamp, c. 1608, Rijksmuseum, Amsterdam

Every company needs talented, skilled people. Over the years companies try to employ more and more talented, skilled people, that fit their requirements, business model and working practices. They continually optimise for the market they are in, particularly the larger ones. They become more and more efficient, more and more ‘Six Sigma’ - lean, mean business machines. And it works. Or at least it does right up until the moment it does not.

The most talented, skilled, efficient horse saddle maker in history probably existed on the day the first Model T automobile rolled off the Ford production line in 1908. From 1900-1910 the US horse population increased by 70%. Life was looking great for saddle makers, just as their industry was about to collapse. Technology changed their world, and there was nothing they could do about it.

Technology is doing the same today to the real estate industry. The ten years 2010 - 2020 were golden. Equities had a great decade but globally listed real estate did even better. Is it any wonder there has been so little innovation within the real estate industry over the last ten years? Of course not, the sector was humming and everyone just double downed and continued to optimise for a business model that was positively purring with success. And that is no criticism, innovation seldom occurs without some form of ‘burning platform’.

The ‘burning platform’ though did exist. It’s just that hardly anyone noticed. Demand was changing but hidden in plain site. What was missing was the spark to ignite the platform. No spark, no worries.

And then the spark arrived, wrapped in a global pandemic. Another Model T moment. Within weeks, commercial real estate closed down. Shops shut, restaurants, hotels and bars closed and offices emptied.

This is where technology kicked in. Because it turns out that, without us really noticing, the world had changed dramatically over the last ten years. Although locked away in our homes, much of the economy actually continued, barely missing a beat. We reel at news of 10-20% drops in GDP but in reality it is extraordinary that the economy has not collapsed much further and faster. 20 years ago, with the internet as it was then, the economies of the world would have simply shut down.

We cannot do much about the world of personal services and hospitality until restrictions on social distancing are lifted, but globally the business community has learnt a huge lesson. Technology has enabled us to understand that ‘work is something you do, not somewhere you go’ is actually true. Hundreds of millions of people working from home, works.

Many knew this was true but it really was the burning platform ‘hidden in plain site’. One of the most striking things of the last few months has been the number of CEO’s expressing astonishment that their businesses are functioning, and in many cases functioning very well indeed. The top 5 winners from the pandemic alone have put on over a $1Trillion in market capitalisation.

So, where does this leave the real estate industry, and what does it tell us about the talent that will be required to survive and thrive over the next ten years? Let’s focus on the office sector. Retail, industrial and residential are also changing but in different ways.

The simplest answer is that it means the real estate industry needs to transform from being one that sells a product to one that delivers a service. It means that our customers no longer need what we have to sell. They don’t need an office to work. Going forward they need to be made to want one. And that is a very different dynamic.

The pandemic has simply acted as a forcing function to trends that were underway anyway, but what a forcing function. In the UK since lockdown e-commerce is up by a third, online groceries up by 84% and as noted above, 90%+ of the office workforce is working from home. Mostly video conferencing on Zoom, which has gone from 10 - 300 million daily users in a few months. Perhaps more importantly, this new behaviour has been adopted now for many months. Habits are being formed, workflows adjusted and we’re getting a solid handle on what works and what doesn’t, and what we like and what we don’t like, about living like this.

And frankly, none of the conclusions are all that surprising. We all appreciate flexibility, agency over our own lives, the freedom to be able to focus when we want to and without endless interruptions, the humanity of having more work/life balance, and the ease with which we can order just about anything and have it delivered to us in no time at all. What we miss is seeing and working with our colleagues, team mates and friends in person, the time away from our homes (we all need a certain amount of ‘space’) and the social and experiential enjoyment of being amongst our fellow humans. Being human, with other humans, is stimulating, enjoyable and entertaining. Of course we miss that.

However the things we miss are the things that we were going to be doing more of anyway, because of technology. As long ago as 2017 McKinsey were writing that ’47% of the tasks people were paid to do globally, could be automated by using currently demonstrated technology’. Much of what we have traditionally done ‘at work’ was leaving the building anyway. Very rapidly, any task that was ‘structured, repeatable, predictable’ was being co-opted by ‘the machines’. The workplace was changing fast because the work we do is changing fast. New work, future work, is increasingly based on those skills, that talent, that we humans have that the machines do not. So, design, imagination, inspiration, creation, empathy, intuition, innovation, abstract & critical thinking, collaboration, social intelligence and judgement. 

And this means that, just like us, our customers are going to need spaces and places that catalyse these human skills. And mostly, those are not the spaces and places we have been developing, and bringing to market, to date.

All of this is happening on a continuum; whilst overall the great home working experiment has proven a success, it is definitely working better for some people than others. For multiple reasons. Some people do not have the space to work at home, or are sharing with friends or family in a way that makes it hard to carve out any work time. Some are working with poor equipment, be it old or underpowered computers or laptops, slow or intermittent broadband, inadequate chairs or desks or lighting. 

And some are working for companies structured and operated for a fixed not flexible world. Working in a distributed manner, mostly away from a central HQ, does require a different organisational structure and a different management style. This though is a known known, and various large, fully distributed companies, such as GitLab and Automattic (each with 1200+ employees across 60+ countries with no ‘offices’) provide a great deal of information and best practice for how to operate as they do. Over time we’ll see many more companies adapting to this new way of working and becoming more effective even than they have rather remarkably been,  despite everything, during the pandemic.

All the above gets us to a position where, as Dror Poleg has written:

‘Covid-19 forced everyone to stop and think. Previously, companies had 100% of their employees at the office and contemplated how many of them can be allowed to work remotely. Now, companies are starting with 100% of employees working remotely and are contemplating how many of them should be at the office at all, how often, and for what purpose.’

This cuts to the chase: what is the value proposition that will make companies regard an office as an asset, not a liability? And that question in turn leads to the next, ‘what talent or skills are required to develop and maintain this value proposition?’.

The clearest conclusion is that we need to be creating spaces and places that offer our customers what they cannot get at home. So to do that we need to understand what it is that fits that bill. So real estate is going to have to start doing what consumer goods companies have been doing for decades. Speaking to customers, understanding their wants, needs and desires and developing products and services based on the quantitative and qualitative data they gather during this process. Most likely they will adopt tools like the Value Proposition Canvas to help them define and refine their offering. 

From here it should be possible to design a UX (User Experience) for your target customer that satisfies their wants, needs and desires. Part of that process will involve people with three different skill sets: Thinkers, Feelers, Doers. So thinkers analyse the data and customer requirements, feelers use empathetic skills to understand the psychology, sociology, anthropology and emotions behind those requirements, and then the doers work out how to build what is required. Some needs will involve more of one skill than the other, but each need can be broken down into an appropriate mix of inputs necessary to achieve a desired output.

All of this is about understanding the brand you wish to create, and that brand will be, as Jeff Bezos said, ‘what people say about you when you are not in the room’. Traditionally the notion of brand has been something the real estate industry did not think has anything to do with them. Which is why you’ll barely find any real estate companies with brands that individual customers recognise. Though they will all know WeWork. And the future is in that comment. For a #FutureProofOffice will be branded. And in terms of talent, this is where we have to start. Your talent has to be able to build your brand.

As you can see, this is moving way beyond traditional real estate. And that is because real estate on its own cannot deliver a strong enough value proposition anymore. It only could when an office was needed in order to work. Now that we have to make our customers want an office, we need to add layers of software and services to our hardware. We are designing an experience that makes someone want something they do not need.

The reality is that the real estate business is no longer about real estate. That is just the starting point. Yes we need strong real estate skills, yes we need all the skills, talent and knowledge we have today, but that is now necessary, but not sufficient.

The skill set required to create great user experiences for customers (and UX = Brand) incorporates six areas of the ‘office’ industry that exist today but rarely talk to each other. Certainly not in any sort of ongoing, joined up manner. They are: real estate, networking (IoT), data capture and analytics, workplace, HR and hospitality. All of these need to be thought of as integral components in a single product/service. All of these are part of what it takes to build a brand. To create, and then curate a great workplace requires all the knowledge, skills and domain expertise of all these specialities to be brought together and managed as a single system. Without doing so we will perpetuate the inefficient usage of so many offices today, as well as the generally low satisfaction in their office of the average occupier.

We need to think of the office as software, and treat it like tech companies treat their own software. Build, measure, learn is the golden rule of software development. You build something, get it in the hands of users, measure how it gets used, and then build a new version, incorporating what you have learnt. And repeat. And repeat. This is why no software is ever finished, it is always version X.Y.Z. Our offices, the product/service we are going to make customers want, needs to be like this. We need to design it thoughtfully in the first place, then we need to constantly monitor usage, and through an ongoing capturing of quantitative and qualitative feedback, regularly release a new version. In respect of every customer, we need to understand what it is they are trying to achieve and see how well the spaces we are providing them with, suit that purpose.

Our job is to enable people to be as happy, healthy and productive as they possibly can be. And that is the industries competitive edge. Or will be. Having the skills, the talent who can actually create a great user experience for customers and then continually refine this in line with changing realities on the ground.

This doesn’t look much like a traditional real estate company does it? And maybe it won’t be, or maybe only rarely. Perhaps only a few real estate companies will be able, or desirous, or willing, to become the sort of multi functional, multi disciplinary, service oriented, customer obsessed companies that this demands. But that is sort of besides the point; if we want our customers to continue wanting what we have to sell we will need to produce these great UX, great experiential spaces for them. Either on our own, or by partnering with 3rd parties who can supply the talent we don’t have. Otherwise, as they have recently found out they can, they might just not bother being our customers anymore. Or move on to somewhere else where they can get the added value that makes an office worthwhile.

The real estate industry needs to up its talent game. It needs to understand it is in the service business now, and broaden and deepen the talent pool. It needs to start with the customer, and work back from there. What does our target, or actual, customer really want, what represents added value to them, and how can we give them want they want. What mix of skills, talent and technology do we need, to create, and curate, this? 

Real estate is no longer about satisfying needs, it is about creating desire. And that is an entirely different type of business, that requires entirely different talent. The future winners will be those that realise this. And act on it.

This was first published on blog.mipimworld.com