User Experience and Productivity, New Real Estate Valuations

The Economist Magazine

30 November 2021

By Luis del Barrio, Business Director at The Mail Company


In the post-pandemic era, the value of physical assets used as office space incorporates a new variable: the extent to which people want to work in them, which in turn will determine how many square metres an organisation needs. And even leaving aside the strength of that desire, digitisation and new work habits (which people have become fully accustomed at every point on the spectrum: 100% or hybrid remote working) mark a paradigm shift. Owners and operators of office buildings have to understand these trends because these workplaces can no longer be thought of as they were up to the beginning of the pandemic in 2020: square metres, services and location. And of course, new generations will soon be coming to the office for the first time. What does that mean? According to a survey by Harris Covid Tracker, 85% of Gen Z (born between 1995 and 2000) want to be able to work remotely from wherever they like, and more than 80% want to be able to travel while they work remotely.


What business model is going to be successful in the future? For several years now, we’ve been talking about Real Estate-as-a-Service (REaaS), but what does this new business model involve? What part will new intelligent buildings play? Selling productivity rather than space. The challenge for organisations will be to attract their staff back to the office, and that will not be easy: offices, as we left them a few months ago, were designed for a function that can now be provided from other places.


The function of offices has grown exponentially in the last eighteen months, from the simple idea of a “workplace” to a place to work in that lets people (individually as employees and collectively as businesses) to meet, work together, build relationships, co-create and – last but not least: communicate corporate values (business culture) and so improve performance over any other setting. That is going to be the real aim of an organisation when choosing a workplace. The focus is going to be on the individual user to give them a space that is comfortable, flexible, and that brings a feeling of community and experiences that make people want to come back, making them more efficient and productive, because we shouldn’t lose focus and forget that an office is a place to work in.


And how can we improve the performance of office-based staff? REaaS generates income based on an improved user experience (which improves productivity) provided by a connected building that is paid for on an as-you-go basis.


The contribution of intelligent buildings.


In this environment, the role of intelligent buildings is obviously of ever-growing importance. An intelligent building connects users to services, with benefits for an organisation’s productivity and the wellbeing of individual members of staff. The physical infrastructure is seen as an enabler, fundamentally changing the business model of owners of office buildings, who become service providers and the ‘custodians’ of both a physical infrastructure and a digital infrastructure. An intelligent building is an inexhaustible source of data (first party data), not only allowing decision-making to be based on better information, but also allowing the data to be used at first hand to offer personalised experiences that can be monetised in different ways: subscription, pay-as-you-go and data monetisation.


Efficient document management in the ‘new office’.


A VUCA (volatility, uncertainty, complexity and ambiguity) environment like today’s makes it essential to receive information quickly and safely without incurring additional costs related to a person’s location. Because not delivering documentation on time means a loss of responsiveness in procedures and decision-making, impacts productivity and may have serious consequences in the case of official time-critical documentation.


Technology and connectivity should ensure that these flows of documentation and information are optimal and aligned with the spatial plan for each member of staff, who may be working in company offices every day, working remotely full-time or just on some days. Whilst each organisation has unique needs and requirements, and varying degrees of implementation of digital processes, it is essential for technology to integrate the physical and digital worlds in the area of document logistics. The accessibility of information, personalisation (the capacity to adapt to the specific needs of each organisation) and user experience are very important, without forgetting something as critical as cybersecurity.


Inspiring examples like Cubework can be a model for building owners to look at. The American business personalises workplaces, particularly warehouses and small highly interactive work areas, for which it has partnered with technology such as Amazon and Samsung. For its customers, Cubework offers not only storage space but also warehouse and transport management software, conference room, drinks, security, CCTV, gym and games rooms. Real estate company CBRE has launched Hana Suite Teams, a flexible corporate space concept  that includes gigabit connectivity, high-density wifi and leading-edge technology with a focus on security and privacy, designed among other things to ensure compliance with data protection laws.


These are two inspiring examples of where the business of providing offices may be heading. Taking on board this cultural and business strategy transformation should now be one of the top agenda items for owners of buildings that might otherwise over the short to medium term see their spaces – seen just as square metres and locations – cease to be of interest to businesses.


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