Innovations in

commercial real estate

Preparing for the city
of the future
Innovations in commercial real estate Preparing for the city of the future

Are your buildings future ready? 1

Future of mobility 3

Occupant health and wellness 7

Internet of Things (IoT) 10

3D printing technology 13

Demographic data and predictive analytics 17

Building of the future: Too far, yet too close 20

Methodology 21

Endnotes 23

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 Innovations in commercial real estate Preparing for the city of the future

Are your buildings

future ready?

In last year’s commercial real estate (CRE) outlook, we

took a longer-term view of how the nexus of technology
advancements and consumer behavior changes will
disrupt and redefine the industry over the next decade.
Considering that fortune-telling in the corporate world is
at best an educated guess, the four themes comprising
collaborative economy, disintermediation in brokerage
and leasing, war for talent, and the last mile appear to
be playing out well in the industry, some at a faster pace
than the others.

At the same time, the corporate world, policy makers,

and government agencies are increasingly challenged
with significant demographic shifts, which include
growing urbanization, longevity of Baby Boomers, and
differentiated lifestyle patterns of Millennials. Added
to those are security, climate change, and resource
scarcity concerns. Collectively, these factors are
stretching both government budgets and the aging
physical infrastructure.

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Innovations in commercial real estate Preparing for the city of the future

Consequently, urban policy makers compel the industry to prepare and respond
are considering innovative ways to use to the changes in the ecosystem. As Rupert
technology to manage cities amid changing Murdoch, Founder, News Corporation, says,
expectations of the expanding urban “The world is changing very fast. Big will
population. Many governments across the not beat small anymore. It will be the fast
world are making budgetary allocations beating the slow.” 4
and considering public-private partnership
With these thoughts in mind, we have
models for developing smart cities,
identified five themes for this year’s outlook
effectively cities of the future, as solutions
that we believe CRE owners should consider
to this conundrum.1 Deloitte considers a city
integral to their business strategy.
to be smart when investments in human
and social capital, traditional infrastructure,
and disruptive technologies fuel sustainable
economic growth and a high quality of life,
Most of these themes are enablers, which
with wise management of natural resources, if used strategically and timely, can equip
through participatory governance.2 One
such example can be seen in Chicago’s
CRE companies to make their physical space
launch of the Array of Things project, a future-ready:
collaborative effort with several academic
and research associations. The project 1. Future of mobility
will use sensors to connect and provide
location-based real-time data on the city’s 2. Occupant health and wellness
environment, activity, and infrastructure.
The effort aims to equip decision makers 3. Internet of Things
with information that can enable specific
actions to make the city more livable,
4. 3D printing technologies
efficient, and healthier.3
5. Demographic data and predictive analytics
Naturally, the built environment plays a
pivotal role and is an integral part of urban
planning. With the heightened need and Going forward, CRE companies should
focus on the city of the future, the question recognize that their business models
you need to ask yourself is: as developers will need to evolve with the changes in
and owners of the built environment, their ecosystem. They will benefit from
are your buildings future ready? Are you reimagining their business strategy and
deploying technology innovatively and by considering innovative ways to execute
effectively to prepare and respond to the it. According to Aaron Block, co-founder
rapidly changing ecosystem? and managing director of MetaProp NYC,
“The current wave of RETech innovation will
Many CRE owners may believe that smart not only replace some existing business
cities or cities of the future are unlikely to models, but it will also make professional
impact the existing built environment, or lives more profitable and more efficient for
that the timing is too far out to consider real estate owners, managers, developers,
seriously. However, some evolving trends brokers, architects, engineers, and other
are likely to impact the CRE industry faster practitioners.”5
than expected. Growing government focus,
rapid advances in technology, and innovative
solutions to improve urban life should

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 Innovations in commercial real estate Preparing for the city of the future

Future of mobility
Changing the CRE landscape

Mobility—the movement of people and At the same time, the car is rapidly cars will enable many current non drivers,
goods—is undergoing significant change. becoming a technology product. such as the elderly, adolescents, and the
A confluence of trends, most notably the Innovations in powertrains and materials disabled, to use cars. Further benefits of
rise of shared access of vehicles and the are expanding what vehicles are capable self-driving cars are numerous, including:
approaching reality of fully autonomous of, and increasing connectivity opens up
• Ability to leverage connection technologies
vehicles, is remaking the extended new possibilities for safer, more efficient,
to communicate between cars, optimize
automotive industry into a new mobility and more enjoyable travel. However,
traffic flows, and minimize congestion
ecosystem.6 The emergence of “pay-per-use,” it is the advent of fully autonomous or
• Enhanced collision avoidance
which is driving much of the collaborative self-driving vehicles—cars, trucks, and
• More efficient use of vehicles; currently,
economy, is also beginning to challenge the drones—that will potentially bring the most
autos are idle over 95 percent of the time,
predominant model of personally owned transformative change not just to auto
on average
vehicles. Today, there are a wide variety of manufacturers, but to the entire mobility
• More efficient and effective parking,
options, such as on-demand ridesharing ecosystem. Our blog post “Commercial real
given that the cars can be parked outside
(Uber and Lyft), carsharing (Zipcar), and bike estate sector: Get set to be disrupted by
of the city 7
sharing (Zagster). driverless cars” highlighted that self-driving

3
Innovations in commercial real estate Preparing for the city of the future

Given their economic incentives, on-demand there could be significant redevelopment operators can also consider using driverless
ridesharing providers might be among the potential for existing parking structures in cars within warehouses to automate
first to adopt this technology.8 CBDs. Retail real estate owners may likewise loading and unloading of goods, along
have an opportunity to repurpose portions with transporting them.14 Equipped with
While much remains uncertain, many of existing parking areas in their large advanced navigation capabilities, these
companies are working to make driverless malls, including adding additional retail and cars will be able to maneuver through small
cars a commercial reality sooner than entertainment space. spaces and around obstacles.15
later—perhaps over the next five years.9
In its recent forecast, IHS Markit suggests Sidewalks will likely be freer as the new CRE owners are also likely to witness a shift
that global autonomous car sales will reach mobility options would reduce curbside in their tenant demography. Victor Coleman,
600,000 by 2025 and that the USA will lead parking, and street widths could be reduced chief executive of a West Coast real estate
the way.10 based on more efficient management of investment trust (REIT), Hudson Pacific
auto traffic. As a result, CRE owners will have Properties Inc., recently noted that there is
How will the future of mobility access to large tracts of space in prime areas an increase in demand for space from both
impact CRE? that can be put to use in different ways— technology companies and traditional auto
Historically, major advances in automotive space that commands very high prices. As an manufacturers, as they ramp up research
technology and the related ecosystems example, in New York’s Soho area, the cost of and experimentation efforts on self-driving
have had a massive impact on CRE. The a parking space is about four times the cost cars.16 Tenants are also likely to redefine
introduction of automobiles in the early of an average single-family home in the US.11 their use of physical space, depending on
part of the 20th century allowed personal Urban planners and CRE owners will have an how this trend impacts their businesses.
freedom and mobility and accelerated opportunity to use the free space in CBDs In our report, “Commercial real estate
the demographic shifts within cities and and urban retail centers for greener spaces, redefined—How the nexus of technology
suburbs. The subsequent mid-century thus promoting healthy living and in turn advancements and consumer behavior will
introduction of the interstate highway contributing to the broader climate-change disrupt the industry,” we highlighted retailers
system connected cities, creating agenda.12 At the same time, urban areas using different and flexible delivery options,
significant real estate development bordering CBDs and well-located suburban such as same-day or next-day delivery, to
opportunities across all property types. properties may witness a change in terms of create differentiation at the last mile. These
Throughout history, real estate fortunes higher demand for high-density parking lots, same retailers may consider using driverless
have been made by correctly anticipating recognizing that driverless cars will require cars for same-day delivery when the vehicles
and reacting to major advances in less space per vehicle for parking. are not otherwise being used.17 In another
transportation technology, including scenario, demand for senior living facilities
automotive, rail, and air. Autonomous trucks will impact the delivery may change as Baby Boomers find a greater
of goods from manufacturer to both retailer variety of mobility options. This in turn will
The evolving future of mobility has the and the end-consumer, disrupting existing likely impact healthcare property owners.
potential to change both the use and supply- logistics networks and, consequently,
and-demand dynamics for CRE. For instance, the demand and location of warehouse In summary, shifting mobility patterns
there may not be a need for large parking properties. In addition, existing warehouse will have a material impact on CRE
spaces in central business districts (CBDs) in spaces may require design changes in valuations, location decisions, future real
the future, as driverless cars can be “sent” the form of “standardization” for easier estate development, and tenant targeting
to park in less-dense areas. As a result, maneuvering.13 Warehouse owners and strategies (see Figure 1).

Figure 1: Future of mobility’s relative impact on different CRE focus areas*

Location Tenant Develop/ Operational Revenue Property Brand

strategy strategy (re)design efficiency growth valuations strength

High Medium High Medium Medium Medium Low

Source: Deloitte Center for Financial Services analysis

*Please refer to the methodology section for details

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 Innovations in commercial real estate Preparing for the city of the future

How could CRE companies respond? new mobility options on existing real estate
In what may be considered early responses investments, as well as on new development
to this evolving trend, several CRE players and investment underwriting decisions. Lesson from
are leveraging new mobility options
to enhance tenant engagement. A few
Location and usability of physical space is
expected to change rapidly with advances in
the trenches
companies are offering reserved parking mobility, which will create new development
spots for car-sharing services, while opportunities within cities of the future, Parkmerced Labs:
others are collaborating with ride-sharing and redevelopment opportunities for many
Integrating changing
companies to offer on-demand travel existing spaces such as parking lots.
mobility patterns into CRE
services at subsidized rates as a tenant
amenity.18 Equity Residential, for one, has Going forward, as tenants, consumers, and development plans20
partnered with Zipcar to offer the latter’s residents increase their use of self-driving
San Francisco developer, Maximus
on-demand car service on a priority basis to vehicles, CRE companies may need to
Real Estate Partners, has invested in
its tenants.19 make design changes to existing spaces to
Parkmerced, an upcoming 152-acre
accommodate the use and impact of new
multifamily redevelopment in San
However, we believe CRE companies mobility options. These companies should
Francisco. The developer has
have an additional opportunity to be also revisit their existing tenant targeting
launched Parkmerced Labs (PM
more strategic in analyzing the impact strategies as their tenant mix is likely to
Labs) to develop transportation
of mobility patterns and options on their change, and as tenants themselves evaluate
solutions that make it easier to live
businesses, to meaningfully effect their the impact of the future of mobility on their
in cities, in light of growing
long-term revenue and profitability. To start, respective businesses.
urbanization and changing lifestyle
companies should evaluate the influence of
patterns. Earlier this year, the
developer, through its PM Labs,

CRE companies have an additional collaborated with Uber to offer

residents a monthly stipend of $100

opportunity to be more strategic in for the services of Uber and Clipper

(a transit card that offers access to

analyzing the impact of mobility patterns many transportation options in the

Bay Area) as an alternative to car

and options on their businesses. ownership. Uber will also offer

residents subsidized fares for its
carpool service to major
transportation hubs. Maximus aims
to discourage car use and
ownership, and ultimately reduce
space for parking lots in its
redevelopment project. The
developer plans to use the space in
a more creative manner, such as
enhancing tenant amenities that
could, for instance, include cycling
tracks. Given the changing personal
mobility patterns, this effort from
Maximus’ PM Labs could be a step
in the right direction.

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Innovations in commercial real estate Preparing for the city of the future

Key takeaways: Future of mobility

Trend overview

•• Remaking the extended automotive industry into a new mobility ecosystem

•• The emergence of “pay-per-use” is beginning to challenge the model

of personally owned vehicles

•• Many companies are working to make driverless cars a commercial reality

sooner than later

Impact on CRE owners

•• Potential to change both the use and supply-and-demand dynamics

•• Access to large tracts of space

•• Opportunity to use the free space in CBDs and urban retail centers for greener spaces,
contributing to the broader climate-change issue

•• Urban areas bordering CBDs and well-located suburban properties may witness
a change in terms of higher demand for high-density parking lots

•• A shift in tenant demography

What should CRE executives do to prepare for the future of mobility?

•• Be more strategic in analyzing the impact of mobility patterns and options on their
businesses, to meaningfully impact their long-term revenue and profitability

•• Explore making design changes to existing spaces to accommodate

the use and impact of new mobility options

•• Leverage new mobility options to enhance tenant engagement

•• Revisit existing tenant targeting strategies

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 Innovations in commercial real estate Preparing for the city of the future

Occupant health
and wellness
Moving beyond resource conservation

In recent years, many Americans have To address this growing need, Delos Living LLC emphasis on mental, social, and physical
become more conscious about health and established the WELL Building Standard within the built environment. In a member
wellness; that awareness is now spilling (WELL), which is “a performance-based survey conducted by the Urban Land
over into the built environment. Studies system for measuring, certifying, and Institute (ULI) in 2013, 95 percent of
suggest that changes in the indoor air monitoring features of the built environment respondents agreed that “human health
quality alone can result in productivity that impact human health and well-being.”26 and the built environment are inextricably
gains of about 8 percent.21 Additional Introduced in October 2014, WELL aims linked with real estate,” and 96 percent of
factors may include thermal comfort, to improve the health and well-being of respondents agreed or strongly agreed
daylighting and lighting, noise, interior building occupants, through controls for that the “real estate industry has to play a
layout, and biophilia. Biophilia essentially air, water, food, light, fitness, and physical critical role in efforts to promote health and
refers to the human need to connect with and mental comfort.27 WELL can be wellness.”30
nature at physical, mental, and social levels, considered an extension of the Leadership
which in turn has an impact on well-being, in Energy and Environmental Design (LEED) Why should CRE companies pay attention
productivity, and societal relationships.22 certification, which focuses on environmental to health and wellness? First, their tenants
sustainability efforts.28 are increasing their strategic focus to help
Millennials, now the largest cohort of the attract and retain quality talent. Further,
The WELL certification is gaining in
US population and labor force, have a biophilic design considerations can improve
popularity, with many countries now
particular lifestyle pattern, as the “live, tenants’ financial performance by reducing
beginning to adopt the standards for their
work, play” mantra holds center stage for operating costs through higher productivity
respective built environments. In the United
them.23, 24 A global 2016 Deloitte Millennial and lower absenteeism. Lastly, tenants can
States, the General Services Administration
survey revealed that Millennials continue to also use such an enhanced environment to
(GSA) and the Centers for Disease Control
place significant importance on well-being strengthen their corporate brand.31
and Prevention (CDC) are researching the
at workplaces.25
broader application of the Fitwel building
Health and wellness features may impact
certification program that will likely be
With that, companies are increasingly CRE prices, especially for Class A properties,
launched publicly in 2017. 29 How the USA
considering multiple ways to improve as sustainability measures such as energy
develops a common standard with existing
health and wellness to attract and retain conservation have now become a norm.
WELL guidelines will be worth noting.
employees, clients, and other stakeholders. There is the potential for an erosion of value
Among many initiatives, they are considering for those buildings that do not offer the
How will the focus on occupant health
making changes to the built environment. appropriate conditions for occupiers/users
and wellness impact CRE?
Many occupiers are studying the impact of to be healthy and productive. The 2013
CRE players have so far focused largely on
the built environment and work patterns ULI-member survey revealed that a full 92
sustainability initiatives relating to resource
on human health, particularly as it relates percent of respondents agreed or strongly
conservation. Companies will now take
to diabetes, cancer, and cardiovascular- and agreed that health and wellness features in
their efforts to the next level by considering
respiratory-related diseases. a real estate property can impact its market
occupant health and wellness, with equal
success and economic value.32

Figure 2: Occupant health and wellness initiatives’ relative impact on different CRE focus areas

Location Tenant Develop/ Operational Revenue Property Brand

strategy strategy (re)design efficiency growth valuations strength

Low High High High High High Medium

Source: Deloitte Center for Financial Services Analysis

7
Innovations in commercial real estate Preparing for the city of the future

How could CRE companies respond? The company plans to use collaborative CRE companies can use environmental
Certainly, heightened tenant focus design thinking to (re)develop future (temperature and air quality) and occupant
on health and wellness requires CRE buildings, and one of its focus areas movement, together with health data
owners to implement requisite features includes promoting occupant health and captured by sensors in IoT-enabled
in new and existing buildings. Similar to wellness in its built environment.33 buildings, to understand the optimal
resource conservation measures, CRE ventilation and temperature levels, and
owners should consider adopting design Further, to enhance tenant loyalty and then make the necessary adjustments in
elements that promote health and wellness satisfaction, CRE owners should consider space conditioning to provide a healthier
when retrofitting existing buildings and collaborating with existing and prospective environment for occupants. Tenants can
developing new ones. For instance, in tenants to understand their requirements also use the data about the movement of
consideration of the disruptive influence and appropriately incorporate design individuals through open spaces to boost
of technology, including demographic elements that can help promote health the productivity of workers by better
and lifestyle patterns, real estate firm and wellness. designing tasks and breaks to facilitate
Hines Interests Limited Partnership has collaboration and even socializing among
established the Hines 2025 Working As highlighted in our research report employees.
Group, which has laid down the vision and “Smart buildings: How IoT technology aims
roadmap for “Hines Building of the Future.” to add value for real estate companies,”

Lesson from the trenches

Cadillac Fairview and TD Bank: Landlord-tenant elements that impact different parameters of building
partnership driving occupant health and performance such as air, water, light, nourishment, fitness,
comfort, and mind, while redesigning the office space. As a
wellness34
result, the building was WELL certified in May 2016. The
With the intent to reduce costs, promote employee health and building has other wellness features such as biophilic artwork,
wellness, and position itself as an “extraordinary place to adjustable height workspaces, nutritious food options, and a
work,” Toronto Dominion Bank (TD Bank) partnered with both wellness library, among others. TD Bank is now extending
its landlord, Cadillac Fairview Corporation Limited (Cadillac) wellness features to its customers by getting WELL certification
and wellness strategy consultant, Delos Living LLC, to refurbish for a new retail bank branch in Bethesda, Maryland.
25,000 square feet of its corporate headquarters in Canada’s
Toronto-Dominion Centre (TDC). TD Bank’s efforts highlight the growing importance of health
and wellness features in driving occupant satisfaction and the
First, the team tore down the walls and created a mix of open benefits of collaboration between landlord and tenant.
office spaces to encourage collaboration and small enclosures
for private meetings. Secondly, they considered various

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 Innovations in commercial real estate Preparing for the city of the future

Key takeaways: Occupant health and wellness

Trend overview

•• Many Americans have become more conscious about health and wellness; that awareness is now
spilling over into the built environment

•• Millennials have a particular lifestyle pattern, as the “live, work, play” mantra holds center stage
for them

•• The WELL Building Standard aims to improve the health and well-being of building occupants,
through controls for air, water, food, light, fitness, and physical and mental comfort

Impact on CRE owners

•• Take sustainability efforts to the next level by considering occupant health and wellness, with
equal emphasis on mental, social, and physical, within the built environment

•• Tenants are increasing their strategic focus to help attract and retain quality talent, and
strengthen financial performance and corporate brand

•• Upside potential for CRE prices, especially for Class A properties

What should CRE executives do to enhance occupant health and wellness?

•• Adopt design elements that promote health and wellness while retrofitting existing buildings and
developing new ones

•• Collaborate with existing and prospective tenants to understand their health and wellness
requirements

•• Use IoT technology to track, adapt, and optimize resource usage

•• Share IoT sensor data with tenants to help the latter enhance employee productivity

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Innovations in commercial real estate Preparing for the city of the future

Internet of Things (IoT)

Transforming building management and tenant experience

Technology innovations have found their way machines in a non-intrusive manner.37 The key insights to employee interactions
to the center of every business as they are potential for IoT in CRE is vast, as suggested and movements, and help design more
increasing connectivity among humans at an by Allied Market Research, which expects customized and comfortable workspaces.
exponential pace. Now, technologies such the global market for smart homes and In another scenario, mall owners can
as the IoT are enabling interactions among buildings to grow to $35.3 billion by 2020, use the same technology to personalize
machines as well, bringing another layer of or at a compounded annual growth rate of shopping experiences by tracking shopper
change to the business ecosystem. 29.5 percent between 2012 and 2020.38 movement patterns through signals from
their cellphones.39
By definition, IoT is a suite of technologies and How will IoT technology impact CRE?
applications that equip devices and locations Commonly known as smart or intelligent Industrial CRE owners can likewise use IoT
to generate all kinds of information—and buildings, IoT-enabled physical space will to enable faster and accurate shipments by
to connect those devices and locations for impact CRE owners in multiple ways. The using smart cart-like robots and meticulous
instant data analysis and, ideally, “smart” technology has the potential to allow CRE tracking through sensors.40
action.”35 (For more information on the companies to improve margins through
technologies that power the IoT, see our cost savings and operational efficiency From a valuation perspective, there is a
primer, Inside the Internet of Things.36) as superior building performance lowers possibility that tenants may soon come to
operating costs, facilitates predictive expect IoT features, implying that buildings
For the CRE sector, an IoT-enabled building maintenance, and increases security. IoT lacking them may trade at a discount.
management system (BMS) offers higher- technology can also enable CRE companies (For more information on the applicability
order benefits compared to existing to create competitive differentiation and and impact of IoT on CRE, please read our
automation efforts. In an IoT-enabled improve topline growth through service detailed report, ”Smart buildings: How IoT
BMS, various types of IoT devices can track innovation to tenants. This can include technology aims to add value for real estate
features such as motion, air pressure, light, leveraging sensor data to offer tenants companies.”
temperature, and water flow and then— more customized design and experience by
with the Internet backbone—enable the capturing and analyzing end-user behaviors. Figure 3 summarizes the impact of IoT
BMS to autonomously sense, communicate, For instance, footpath technologies can technology on various aspects of the CRE
analyze, and act or react to people or other enable office property owners to provide business.

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 Innovations in commercial real estate Preparing for the city of the future

Figure 3: IoT technology’s relative impact on different CRE focus areas

Location Tenant Develop/ Operational Revenue Property Brand

strategy strategy (re)design efficiency growth valuations strength

Low High High High Medium Medium High

Source: Deloitte Center for Financial Services analysis

How could CRE companies respond? and analyze sensor data to offer analytics companies can leverage service providers
Many CRE companies are currently in the as a service to tenants and third parties, that aggregate and analyze anonymous
initial stages of adopting IoT technology; they generating revenue from new sources. For wireless signaling data to provide insights on
have been installing sensors and automating instance, owners can use data on occupant movement and flow of traffic and consumer
activities with their sights on low-hanging movement within their properties to entice behavior.43 These insights can then be
fruit such as cost savings and operational advertisers and generate new or enhanced combined with demographic factors such as
efficiency through improved energy revenues.42 population and job growth, crime, pollution,
management and reduced personnel costs.41 noise, and climate patterns, to enable
Having said that, as CRE companies plan IoT more-informed decision making. Finally and
But to realize the full benefit of IoT technology adoption, they will potentially perhaps equally important, CRE companies
technology, CRE companies should have to ascertain ways to ensure seamless should consider and adopt appropriate
determine the types of IoT applications that integration and interoperability with cyber security measures as data privacy and
would be most beneficial to them. Once they existing technology systems. They will need cyberattack concerns are magnified in an
have evaluated and selected the appropriate appropriate analytic tools and visualization IoT-connected world.
IoT applications, CRE companies should capabilities to analyze the large sets of
find ways to monetize their IoT investment. diverse data collected from sensors and
CRE companies can record, aggregate, traditional sources. For instance, CRE

Lesson from the trenches

CBRE: Leveraging IoT to differentiate its real management activities and building automation systems to
estate space44 identify trends and spot improvement opportunities at the
individual building and portfolio levels.
CBRE, one of the world’s largest CRE services and investment
firms, is leveraging IoT to enhance occupant experience and The company is also focusing on employee health and
operational efficiency by improving building responsiveness experience to further differentiate itself. For instance, CBRE’s
and performance while reducing building management costs. “Workplace360” initiative aims to ease and support the way its
For clients, the company is particularly focused on employees work and collaborate across locations. To promote
remote-sensor capabilities that can optimize environment health and productivity, the company has deployed smart
comfort, reduce energy usage, and decrease heating, ventilation and air conditioning (HVAC) systems at
building-performance-related risk. In its own offices, CBRE is several of its properties to infuse fresh air from the outdoors,
using smart LED fixtures that automatically adjust their levels as and when carbon dioxide levels rise indoors.
based on natural daylight and is deploying utilization-sensing
technologies. Further, in collaboration with Johnson Controls, Finally, CBRE plans to drive common standards and better
CBRE is investing in the Building Innovation Lab, with the goal cyber risk management practices through its innovation lab.
of innovating and piloting new building technologies to While there is still some time before CBRE can maximize the
improve client building performance and occupant experience. value of IoT-enabled buildings, the company is on the right
The firm is also highly focused on using building intelligence track to create value for itself and for its clients.
and data analytics, with data generated from building

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Innovations in commercial real estate Preparing for the city of the future

Key takeaways: Internet of Things

Trend overview

•• Enabling interactions among machines and bringing another layer of change to the
business ecosystem

•• Offers higher-order benefits compared to existing automation efforts

•• Various types of IoT devices can track features such as motion, air pressure, light, temperature,
and water flow and then—with the Internet backbone—enable the BMS to autonomously sense,
communicate, analyze, and act or react to people or other

Impact on CRE owners

•• Can improve margins through cost savings and operational efficiency

•• Create competitive differentiation and improve topline growth through service innovation
to tenants

•• Higher property values as there is a possibility that tenants may soon expect IoT features,
implying that buildings lacking them may trade at a discount

What should CRE executives do to adopt the Internet of Things?

•• Determine the types of IoT applications that would be most beneficial

•• Find ways to monetize IoT investment

•• Record, aggregate, and analyze sensor data to offer analytics as a service to tenants and third
parties, generating revenue from new sources

•• Ensure seamless integration and interoperability with existing technology systems

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 Innovations in commercial real estate Preparing for the city of the future

3D printing technologies
Driving construction innovation and
tenant personalization

Humans today have a growing desire higher quality construction.47 Given its rise CRE buildings with large 3D printers
for personalization, with consumption many benefits, global 3D printing industry and have reported benefits around the
patterns tilting toward more customized revenues are expected to more than double aforementioned areas.49 In these initial
goods and services. 3D printing is one to $35.4 billion by 2020, from $15.9 billion use cases, building construction time
such technology that is likely to enable in 2016.48 (For more insights to 3D printing has been reduced by 50-70 percent with
and address customization requirements. technologies, please refer to our Deloitte increased automation using 3D printers.50
Also known as additive manufacturing, 3D University Press collection.) Construction costs have also been lower
printing “refers to a group of technologies due to a 50–80 percent decrease in labor
that create products through the addition of How will 3D printing impact CRE? expenses, with less wasted material. Quality
materials (typically layer by layer) rather than has been superior due to customized
3D printing technologies will impact the CRE
by subtraction (through machining or other and intricate designs, built-in insulation in
industry in both direct and indirect ways.
types of processing).”45 3D-printed walls, and a higher sustainability
Directly, the technology has more relevance footprint due to the use of recycled waste
3D printing technologies have found for engineering and construction (E&C) as part of the raw material and concrete.51,52
applications across several industries, companies. As highlighted in our blog, Despite the clear benefits, there is a general
including consumer products, automobiles, 3D-printed commercial buildings: Faster, sense that a broader adoption of 3D printing
and life sciences, with the main cheaper, better, 3D printing is likely to in building construction could take longer in
advantages being speed to market, design reduce construction costs, drive operational developed markets such as the USA, as it will
customization, and waste reduction.46 In efficiency, and enhance the quality of take time for safety standards and building
the CRE industry, 3D printing can be used construction. A few companies in China codes to evolve.
in construction activities for faster and and Dubai have already developed low-

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Innovations in commercial real estate Preparing for the city of the future

Going forward, CRE owners are likely its customers have the opportunity to more reshoring of manufacturing facilities
to be impacted by tenants’ use of 3D design and 3D print their home furnishings and could disrupt some of the existing
printing technology, as it will influence with an option to ship the goods directly supply chains and logistics systems.55
both the demand for space and the way it to customer locations.53 In contrast, a few
Bottom line, 3D printing offers an
is used. Demand for retail and industrial retailers are using 3D printing technologies
opportunity to E&C companies to innovate
CRE spaces will likely be particularly to enhance shopper engagement and
current construction practices. At the
affected, due to the potential use of these experience, driving more traffic into their
same time, it’s important for CRE owners
technologies for more customized and stores. For instance, Macy’s is using 3D
to consider the impact and usage of this
on-demand production and delivery, printers to cater to Millennial shoppers,
technology by tenants when making their
reducing the need to hold inventory in large providing personalized products ranging
location and development decisions.
warehouses or retail stores. At Lowe’s, a from jewelry to jeans.54 But in the industrial
home improvement and appliances retailer, space, 3D printing of goods will likely bring

Figure 4: 3D printing technology’s relative impact on different E&C & CRE focus areas

E&C companies

Location Tenant Develop/ Operational Revenue Property Brand

strategy strategy (re)design efficiency growth valuations strength

Low Low High High Medium Low Medium

Source: Deloitte Center for Financial Services analysis

CRE owners

Location Tenant Develop/ Operational Revenue Property Brand

strategy strategy (re)design efficiency growth valuations strength

Medium High High Medium Medium Medium Medium

Source: Deloitte Center for Financial Services analysis

3D printing offers an opportunity to

E&C companies to innovate current
construction practices.

14
 Innovations in commercial real estate Preparing for the city of the future

How could CRE companies respond?

Currently, most E&C companies and

developers are using 3D printing to make 3D Lesson from the trenches
models, and are potentially in the research
and testing phase for 3D printing of
buildings and the underlying components.
Going forward, E&C companies can invest Tishman Speyer: 3D-printed models enabling more sophisticated
in firms that focus on building large 3D investment decisions60
printers or partner with leading universities,
In what some considered an initial use of 3D printing technologies by real estate
to be at the forefront of 3D printing
companies, developer Tishman Speyer partnered with Autodesk and Steelblue to
innovations in the construction sector.
create one of the largest 3D-printed scale models of San Francisco.
For instance, researchers at Singapore’s
Nanyang Technological University are
The model, printed with a 16-micron resolution, showcased over 115 blocks of
studying the feasibility of using giant 3D
the Financial and South of Market neighborhoods in San Francisco with great
printers that can print an entire floor of a
precision. These included some well-known developments such as San Francisco
high-rise building in one go.56 As more use
Museum of Modern Art and the Ferry building. In addition, it represented fully
cases emerge, companies should analyze
developed versions of currently under-construction buildings to provide an idea
financial, physical, and regulatory feasibility
of the future landscape of the area. With dynamic lighting and projection from
of 3D-print buildings.
the top of the model, it simulated different conditions such as natural daylight
patterns for different buildings and traffic movements across the district. In
CRE owners can use 3D-printed models
addition, the model allowed easy replacement of existing buildings or blocks
for their development decisions. In fact,
with new forms to understand different design options or make updates as per
institutional investors are beginning to use
the actual developments.
them to enable more informed real estate
investment decisions.57
The 3D model thus helped Tishman Speyer to better understand the current and
future development scenario in San Francisco, and potentially added more rigor to
Retail CRE owners should collaborate
its future investment decisions around location, building design, and construction.
with tenants and understand their
differentiated space design requirements
as tenants increase their use of 3D printing
technology to attract customers. Industrial
CRE owners will have to restrategize and
reposition existing warehouses as on-
demand production and faster delivery
will likely increase demand for smaller
distribution and fulfillment centers, which
are located well within city limits and closer
to the end consumer.58 At the same time,
companies will also have to consider space
requirements for 3D printers and related
inputs. In addition, CRE companies can
improve space utilization and tenant service
through alternative leasing strategies like
multi-tenant solutions and use of smart
technologies.59

15
Innovations in commercial real estate Preparing for the city of the future

Key takeaways: 3D printing technology

Trend overview

•• Growing desire for personalization as consumption patterns are tilting towards more customized
goods and services

•• Enables and addresses customization requirements

•• Can be used in construction activities for faster and higher quality construction

Impact on CRE owners

•• Reduce construction costs, drive operational efficiency, and enhance the quality
of construction

•• Tenants’ use of 3D printing technology influence both the demand for space and the way it is
used, particularly in the retail and industrial space

What should CRE executives do to adopt 3D printing technology?

•• Invest in firms that focus on building large 3D printers or partner with leading universities, to be
at the forefront of 3D printing innovations in the construction sector

•• Analyze financial, physical, and regulatory feasibility of 3D-print buildings

•• Use 3D-printed models for their development decisions

•• Restrategize and reposition existing warehouses

•• Improve space utilization and tenant service through alternative leasing strategies and use of
smart technologies

•• Be aware that broader adoption of 3D printing in building construction could take longer in
developed markets such as the USA, as it will take time for safety standards and building codes
to evolve

16
 Innovations in commercial real estate Preparing for the city of the future

Demographic data and

predictive analytics
Enabling smarter decision making

In today’s hyper-connected world, there the city and analyze nearly 7,500 factors vacancies, and can even calculate the impact
is an overload of information and data from data accumulated by different city of renovating or adding new amenities to an
waiting to be used in meaningful ways agencies.65 existing building.67 It has also developed a
to enable smarter decision making. quantitative solution to compare properties
Demographic data make up one such How will a combination of in different US markets with the introduction
information set, which is now widely used demographic data and predictive of a property-level composite score.68
due to the distinct preferences of different analytics impact CRE?
age cohorts such as Millennials and Baby CRE owners can make more informed Companies can further use demographic
Boomers. Unlike traditional methods, data decisions by using predictive analytics data and predictive analytics for their
captured through the Internet, satellites, on the expanded sets of demographic leasing activities as well as for driving
and sensors include people’s preferences data. For instance, it will be useful for tenant engagement and loyalty. Take
and behaviors, often going beyond companies to know the unique and the case of a mall owner looking for the
standard information such as age, income, detailed future demographic profile of a appropriate tenant mix. Advanced data
and gender to include parameters like region in which they are either present analytics tools can help aggregate and
relationship status, career history, home or plan to invest in the future. Once analyze unconventional and unstructured
ownership, past travel destinations, and companies get an idea of the needs and data, such as online enquiries and
immigration, among others.61 preferences of the prospective inhabitants purchases, website clicks, location check-
of a region, they can potentially assess ins, shopper traffic patterns, and shared
While the increased volume, velocity, and whether the existing CRE infrastructure social media content. The insights from
veracity of the available data provide more will align with the requirements of those this data combined with other traditional
information to businesses, companies are inhabitants. These insights along with demographic factors can lead to more
also challenged to make sense of all that other considerations, such as property accurate forecasting of consumer buying
data. Companies can benefit significantly ownership and management costs, patterns.69 This in turn can be used to
from the use of predictive analytics tools to upcoming developments in the region, decide the appropriate tenant mix and
analyze the past data and use algorithms and transportation infrastructure, can optimal tenant locations within the mall,
and machine learning techniques to predict help decide the location and scale of new and plan the sales and marketing strategy.
the future. Some of the tools that combine developments and redevelopment or
consumer lifestyle segmentation data redesign needs for existing properties. CRE companies can also use data and
and analytics capabilities are Experian’s analytics to add rigor to existing property
Mosaic USA and Esri Tapestry.62 Existing Enodo Score, a startup that recently valuation methodologies by building in
applications include predicting demand for launched its predictive analytics platform more nuances around location dynamics,
consumer products at a store level by using for CRE, is working in a similar direction. The building usage by occupants, and so forth,
web-search data linked to that store, along platform uses advanced analytics, including allowing CRE owners to eventually make
with the traditional time-series sales data.63 machine learning algorithms, on real-time more data-driven portfolio decisions. This
In the public sector space, entities such market data, large sets of census data, type of analysis can also enable institutional
as the Fire Department of the City of New and past property information, to enable investors in their investment decisions, as
York (FDNY) have started using predictive more informed investment decisions about they will have more granular information
analytics to identify buildings that are most multifamily properties.66 For example, the about buildings.
likely to catch fire.64 The FDNY plans to use platform can help assess the impact of new
advanced algorithms to track trends across and upcoming developments on rents and

17
Innovations in commercial real estate Preparing for the city of the future

Figure 5: Demographic data and predictive analytics’ relative impact on different CRE focus areas

Location Tenant Develop/ Operational Revenue Property Brand

strategy strategy (re)design efficiency growth valuations strength

High High Medium Medium High Medium High

Source: Deloitte Center for Financial Services analysis

How could CRE companies respond?

A few CRE owners have already started
on the analytics journey. French shopping
mall owner and manager, Klépierre, uses
Lesson from the trenches
demographic analysis in its property
acquisition and disposition decisions.70
However, many CRE owners and developers Westfield Corporation: Investing in data and analytics
still make key location and tenant decisions
technologies and partnerships to improve tenant engagement
based on experience and intuition. While
and enhance shopper experience73
experience does count, there exist many
new tools to leverage data and enhance Westfield Corporation, one of the largest mall owners in the world, is significantly
decision making today. focused on using analytics to enhance tenant and shopper experience and
engagement. In November 2015, the company announced its intent to design and
To expedite the adoption of data-driven execute a comprehensive data strategy by establishing a separate big data and
decision processes, CRE owners and analytics function and leadership appointments. As part of this strategy, the
developers can consider different company will work through its digital innovation arm, Westfield Labs, and also
approaches to using predictive analytics increase collaboration with tenants.
capabilities in their business. They can
potentially partner or hire the services of Along these lines, Westfield Labs has partnered with RetailNext, a leading retail
consultants and startups that specialize analytics firm focused on physical stores, to provide in-store analytics and useful
in these capabilities, due especially to shopper data to tenants.
a shortage of analytical talent in the
marketplace.71 Companies in other Westfield is exploring additional data analytics opportunities and aims to use its
industries are also teaming with multiple tenants’ large repository of customer data. As Westfield’s co-CEO, Steven Lowy
service providers from the advanced says, “We’re building the best customer experience for each customer. With the
analytics domain.72 power of our collective IT, we can make the experience even better than anything
they can get online.”
CRE companies can only benefit from
enhancing the analytical capabilities of
existing talent, so that they can use the data
provided by external service providers in a
more meaningful manner.

18
 Innovations in commercial real estate Preparing for the city of the future

Key takeaways: Demographic data and predictive analytics

Trend overview

•• Widely used for smarter decision making due to the distinct preferences of different age cohorts

•• Used to make sense of the increased volume, velocity, and veracity of the available data

•• Predictive analytics tools analyze the past data and use algorithms and machine learning
techniques to predict the future

Impact on CRE owners

•• Informed decision-making—investments, location, leasing—through use of predictive analytics

on the expanded sets of demographic data

•• Drive tenant engagement and loyalty

•• Add rigor to existing property valuation methodologies

•• Enable sophisticated decision-making for institutional investors

What should CRE executives do to leverage demographic data and predictive analysis?

•• Use tools for more informed location, investment, and tenant decisions

•• Partner or hire the services of consultants and startups that specialize in predictive
analytics capabilities

•• Enhance the analytical capabilities of existing talent

19
Innovations in commercial real estate Preparing for the city of the future

Building of the future:

Too far, yet too close
Transforming building management and tenant experience

Technology advancements have lowered respect to locating future developments, the changes in their ecosystem at a desirable
the cost of hardware, innovation, and (re)designing the physical space, and pace. Companies should consider an outside
prototyping to such a large extent that aligning with the changes in demographic approach to accelerate their operations
new startups are developing products and and consumption patterns. As these and decision-making processes, in order to
services at a fast pace.74 Consequently, technologies generate more data, CRE keep pace with the rapid changes in their
technology and innovation are challenging companies can consider using predictive ecosystem. Some of the approaches can
and changing traditional business analytics to make more informed data- include partnering with existing startups or
models. CRE companies need to realize driven decisions. This would allow them establishing research and innovation labs,
that changes that seem far out are not to garner competitive advantage and or corporate accelerators. And increasing
really so. As governments experiment drive topline and bottom-line growth by collaboration with tenants and other
with shaping the cities of the future, enhancing every aspect of their business: stakeholders will provide CRE companies
innovations in the automotive sector location decisions, property development with additional insights on the impact of
transform personal mobility patterns, and and valuations, as well as tenant attraction, innovation and disruption, and perhaps also
tenants emphasize promotion of occupant engagement, and loyalty. provide early warnings and valuable insights
health and wellness, so will CRE owners to shape innovative strategic responses.
have to re-invent their strategy to prepare The question now is how should companies
and respond to the anticipated changes to drive these innovations? As highlighted The truth is that CRE companies need to act
the built environment. in our recent blog, “Startup accelerators now and be experimental, rather than only
are driving innovation in CRE,” the typical plan for the future. As Joichi "Joi" Ito, Director
Coincidentally, technology is the enabler for growth approaches—whether organic or of MIT Media Lab, mentioned in one of his
companies looking to reinvent themselves. acquisition of similar types of companies or TED talks, “Don't be a futurist, be a now-ist.”75
CRE companies have an opportunity to use businesses—may not be enough. Many CRE
technologies such as IoT, 3D printing, and companies would benefit from investing in
advanced analytics to be innovative with the tools and talent to respond or react to

20
 Innovations in commercial real estate Preparing for the city of the future

Methodology
The heat maps in each section represent our assessment of the relative impact
(high-medium-low) of each theme across different focus areas for CRE companies.

Details of the focus areas:

• Location strategy includes site selection and other location decisions
• Tenant strategy includes selection, attraction, satisfaction, and retention
• Brand strength includes differentiation and brand enhancement
• Develop/(Re)design includes new developments, space design, and redesign
• Operational efficiency includes process improvements and cost savings
• Revenue growth includes a positive change in rentals and occupancy rates
• Property valuations includes a positive change in capital values and net asset values

21
Innovations in commercial real estate Preparing for the city of the future

Contacts
Industry leadership The Center wishes to thank the following Deloitte client service
professionals for their insights and contributions to this report:
Robert T. O’Brien
Vice chairman and partner Francisco Acoba, managing director, Deloitte Consulting LLP
Global and US Deloitte Real Estate Leader Sinam Al-Khafaji, senior manager, Deloitte Financial Advisory Services LLP
Deloitte & Touche LLP Steven Bandolik, managing director, Deloitte Services LP
+1 312 486 2717 Jim Brock, partner, Deloitte Tax LLP
[email protected] Darin Buelow, principal, Deloitte Consulting LLP
Scott Corwin, managing director, Deloitte Consulting LLP
Deloitte Center for Christopher Dubrowski, partner, Deloitte & Touche LLP
Financial Services Jennifer Fisher, managing director, Deloitte LLP
Matt Kimmel, principal, Deloitte Transactions and Business Analytics LLP
Jim Eckenrode
Bob Kroner, specialist leader, Deloitte Consulting LLP
Executive director
Ken Meyer, principal, Deloitte Consulting LLP
Deloitte Center for Financial Services
Avi Schwartz, principal, Deloitte Financial Advisory Services LLP
Deloitte Services LP
Larry Varellas, partner, Deloitte Tax LLP
+1 617 585 4877
John Wescott, senior manager, Deloitte Consulting LLP
[email protected]
Carrie Winell, senior manager, Deloitte & Touche LLP
Authors
Surabhi Kejriwal The Center wishes to thank the following Deloitte professionals for
Research leader, Real Estate their support and contributions to the report:
Deloitte Center for Financial Services
Akanksha Bakshi, analyst, Deloitte Support Services India Pvt. Ltd
Deloitte Support Services India Pvt. Ltd.
Michelle Chodosh, manager, Deloitte Services LP
+1 678 299 9087
Lisa DeGreif Lauterbach, financial services industry marketing leader, Deloitte Services LP
[email protected]
Catherine Flynn, senior marketing manager, Deloitte Services LP
Megan Lennon, senior manager, Deloitte Tax LLP
Saurabh Mahajan
Erin Loucks, lead marketing specialist, Deloitte Services LP
Manager, Real Estate
Derek Pankratz, manager, Deloitte Services LP
Deloitte Center for Financial Services
Vipul Sangoi, analyst, Deloitte Support Services India Pvt. Ltd
Deloitte Support Services India Pvt. Ltd.

Neeraj Sahjwani
The Center wishes to thank Jon Lovell, co-founder, Hillbreak Limited, UK for his
Senior analyst, Real Estate
contributions to this report.
Deloitte Center for Financial Services
Deloitte Support Services India Pvt. Ltd.

22
 Innovations in commercial real estate Preparing for the city of the future

Endnotes
1. Doug Peeples, “Need a Hand With Your Smart City Project? Government 21. Park JS and Yoon CH, “The Effects of Outdoor Air Supply Rate on Work
Help May Be On the Way,” Smart Cities Council, August 2, 2016; “Smart Cities: Performance During 8-h Work Period,” Department of Architectural Engineering,
Background Paper,” Department for Business, Innovation & Skills, www.gov.uk, Hanyang University, Seongsong-gu, Seoul, 2011
October 9, 2013
22. “The Economics of Biophilia: Why Designing With Nature in Mind Makes Financial
2. Rob Dubbeldman and Stephen Ward, “Smart Cities: How Rapid Advances in Sense,” Terrapin Bright Green LLC, 2012, www.terrapinbrightgreen.com
Technology Are Reshaping Our Economy and Society,” Deloitte Gov Lab, The
23. “Millennials Outnumber Baby Boomers and Are Far More Diverse, Census
Netherlands, November 2015
Bureau Reports,” press release, United States Census Bureau, June 25, 2015
3. “Array of Things,” arrayofthings.github.io, Accessed August 29, 2016
24. Richard Fry, “Millennials Surpass Gen Xers as the Largest Generation in U.S.
4. “Top 20 Inspirational Business Quotes from Famous Founders,” Despreneur, Labor Force,” Pew Research Center, May 11, 2015
May 20, 2013
25. “The 2016 Deloitte Millennial Survey: Winning Over the Next Generation of
5. Olga De Benoist, “Interview with Aaron Block: How to Encourage Innovation in Leaders,” Deloitte, 2016
the Real Estate Industry,” Global Real Estate Experts, March 30, 2016
26. "International WELL Building Institute announces enhanced options to the
6. Scott Corwin, Joe Vitale, Eamonn Kelly, Elizabeth Cathles, “The Future of WELL Building Standard," Blue Building Institute, October 23, 2015
Mobility: How Transportation Technology and Social Trends Are Creating a
27. "CaGBC is bringing the WELL Building Standard® to Canada," Canada Green
New Business Ecosystem” Deloitte University Press, September 24, 2015;
Simon Ninan, Bharath Gangula, Matthias von Alten, Brenna Sniderman, “Who Building Council, www.cagbc.org
Owns the Road? The IoT-Connected Car of Today—and Tomorrow,” Deloitte 28. "The Next Frontier in Sustainability: The WELL Building Standard," Green
University Press, August 18, 2015 Building Education Services blog, http://www.gbes.com/blog/the-next-
7. Scott Corwin, Joe Vitale, Eamonn Kelly, Elizabeth Cathles, “The Future of frontier-in-sustainability-the-well-building-standard/
Mobility,” Deloitte University Press, September 24, 2015 29. Leigh Stringer, "FITWEL and the Center for Active Design, an Interview with
8. Alison Griswold, “Uber’s Self-Driving Cars Are on the Road,” Quartz, May 19, Joanna Frank,” Leigh Stringer website, accessed June 17, 2016
2016, http://qz.com/688003 30. Kathleen McCormick, “Intersections: Health and the built environment,” Urban
9. Max Chafkin, “Uber’s First Self-Driving Fleet Arrives in Pittsburgh This Month,” Land Institute and Building Healthy Places Initiative, 2013
Bloomberg, August 18, 2016 31. “Health, well-being & productivity in offices: The next chapter for green
10. “Annual Autonomous Car Sales to Hit 21 Million by 2035,” Autocar, June 10, 2016 building,” World Green Building Council, September 2014

11. Candace Jackson, “The Race to the $1 Million Parking Spot,” The Wall Street 32. Kathleen McCormick, “Intersections: Health and the built environment,” Urban
Journal, August 25, 2015 Land Institute and Building Healthy Places Initiative, 2013

12. Jason Henderson and Jason Spencer, “Autonomous Vehicles and Commercial 33. Hines Sustainability website, www.hines.com/about/sustainability, accessed
Real Estate,” Cornell Real Estate Review, 2016 on August 26, 2016

13. Ron Derven, “Driverless Trucks,” NAIOP Development Magazine, Summer 2015 34. LEED Spotlight: TD Bank Group’s Toronto Office Certifies WELL Gold, Marking
the First WELL Certified™ Project under WELL v1,” Canada Green Building
14. Dr. Markus Kückelhaus, “Self-Driving Vehicles in Logistics,” DHL Trend Council, www.cagbc.org, 2016. Peter Fabris, “TD Bank Group's Renovated
Research, 2014 Toronto Office Is First WELL-Certified Project Under WELL v1,” Building
Design+Construction, June 8, 2016. “TD Bank's New Store in Bethesda is
15. Ibid
Committed to Your Health,” Obesity, Fitness & Wellness Week, April 22, 2016.
16. Eliot Brown, “Real Estate for Autonomous Car Facilities Gains Movement in
35. Surabhi Kejriwal and Saurabh Mahajan, “Smart buildings: How IoT Technology
Silicon Valley,” Wall Street Journal, May 5, 2016
Aims to Add Value for Real Estate Companies,” Deloitte University Press,
17. Taylor Mammen and Brandon Beck, “RCLCO futuRE Series: A Driverless Vehicle April 19, 2016
Roadmap for the Real Estate Practitioner–Part 2,” RCLCO, December 22, 2015
36. Jonathan Holdowsky, Monica Mahto, Michael E. Raynor, Mark J. Cotteleer,
18. Carisa Chappell, “Office REITs Cater to Commuters With Electric Vehicles,” REIT. “Inside the Internet of Things (IoT), a Primer on the Technologies Building the
com, September 11, 2012 IoT,” Deloitte University Press, August 21, 2015

19. Jane Tindall, “Zip Car in Your Building,” Equity Residential blogs, June 12, 2012. 37. Surabhi Kejriwal & Saurabh Mahajan, “Smart buildings: How IoT Technology
Accessed August 14, 2016 Aims to Add Value for Real Estate Companies,” Deloitte University Press,
April 19, 2016
20. The case study is based on the following secondary sources: “Parkmerced
Announces Exclusive Partnership With Uber,” Maximus Partners Company 38. “Smart Homes and Buildings Market to Reach $35.3 Billion, Globally, by 2020,”
press release, May 18, 2016. Michael Cabanatuan, “Parkmerced Plans to press release, Allied Market Research, https://www.alliedmarketresearch.
Subsidize Residents’ Use of Uber, Muni, BART,” SFGate, May 18, 2016 com/press-release/smart-homes-and-buildings-market-to-reach-35-3-billion-
by-2020.html

23
Innovations in commercial real estate Preparing for the city of the future

39. Surabhi Kejriwal & Saurabh Mahajan, “Smart buildings: How IoT Technology 60. The case study is based on the following secondary sources: “Unveiling the
Aims to Add Value for Real Estate Companies,” Deloitte University Press, Largest-Ever 3D-Printed Model of San Francisco,” Autodesk, May 28, 2014.
April 19, 2016 “Stratasys 3D Printing Gives Architects Finer Details and More Display Options
for 2017 San Francisco Skyline,” Stratasys Blog, October 11, 2014
40. Ibid
61. “Bringing Predictive Analytics to Real Estate,” The Swanepoel T3 Group,
41. Ibid November 19, 2015
42. Ibid 62. Mosaic® USA consumer lifestyle segmentation, Experian website, http://www.
43. www.airsage.com, accessed on September 1, 2016 experian.com/marketing-services/consumer-segmentation.html. Esri Tapestry
Segmentation, Esri website, accessed August 25, 2016
44. The case study is based on certain primary information on CBRE’s IoT
initiatives and the following secondary sources: Michelle Ervin, “Inside CBRE’s 63. Jacob LaRiviere, Preston McAfee, Justin Rao, Vijay K. Narayanan, Walter Sun,
latest workplace transformation,” REMI Network, July 11, 2016, https://www. “Where Predictive Analytics Is Having the Biggest Impact,” Harvard Business
reminetwork.com/articles/inside-cbres-latest-workplace-transformation/. Review, May 25, 2016
Billy Fink, “5 Insights into the Workplace of Tomorrow from CBRE,” Hightower
64. Brian Heaton, “New York City Fights Fire with Data,” Government Technology,
Blog, March 29, 2016
May 15, 2015
45. Mark Cotteleer, Jonathan Holdowsky, Monica Mahto, “The 3D Opportunity
65. Ibid
Primer: the Basics of Additive Manufacturing,” Deloitte University Press,
March 6, 2014 66. “Enodo Score, A Predictive Analytics Platform for Commercial Real Estate,
Launches and Seeks Beta Testers,” Marketwired, May 23, 2016
46. Ibid
67. Ibid
47. Michelle Starr, “World's First 3D-Printed Apartment Building Constructed in
China,” CNET, January 19, 2015 68. Ibid

48. “Worldwide Spending on 3D Printing Expected to Surpass $35 Billion in 2020, 69. “Predictive Analysis Is Transforming Commercial Real Estate: Are You Ready?,”
According to IDC,” press release, August 11, 2016 Goldin Peiser & Peiser, LLP, February 2016

49. Michelle Starr, “Dubai Unveils World's First 3D-Printed Office Building,” CNET, 70. Kate Allen, “Why Real Estate Investors Should Follow Global Population
May 25, 2016 Trends,” Financial Times, April 10, 2015

50. Michelle Starr, “World's First 3D-Printed Apartment Building Constructed in 71. “Analytics Trends 2016: The Next Evolution,” Deloitte, 2016
China,” CNET, January 19, 2015
72. Ibid
51. Ibid
73. The case study is based on the following secondary sources: Sharon Edelson,
52. Ibid “Westfield’s Lowy Looks to Mall’s Future,” WWD, January 20, 2016. “Westfield
Hires Chief Data And Analytics Officer,” Retail TouchPoints, October 26, 2015.
53. Katie Armstrong, “Lowe’s Offers Bespoke 3D Printed Designs,” 3D Printing
RetailNext company website
Industry, September 8, 2016
74. Joi Ito, “Want to innovate? Become a ‘now-ist’,” TED Talk, March 2014
54. Debra Thimmesch, “Macy's Goes Millennial with High-Tech Offerings, Including
3D Printed Selfies,” 3DPrint.com, September 30, 2015 75. Ibid

55. Surabhi Kejriwal, “Commercial Real Estate Redefined: How the Nexus of
Technology Advancements and Consumer Behavior Will Disrupt the Industry,”
Deloitte Center for Financial Services, October 2015

56. Barbara Eldredge, “Can 3D Printing Create Massive Legos for High-Rise
Construction?,” CURBED, April 7, 2016

57. “Unveiling the Largest-Ever 3D-Printed Model of San Francisco,” Autodesk, May
28, 2014. “Stratasys 3D Printing Gives Architects Finer Details and More Display
Options for 2017 San Francisco Skyline,” Stratasys Blog, October 11, 2014

58. Surabhi Kejriwal, “Commercial Real Estate Redefined: How the Nexus of
Technology Advancements and Consumer Behavior Will Disrupt the Industry,”
Deloitte Center for Financial Services, October 2015

59. Ibid

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Innovations in commercial real estate Preparing for the city of the future

25
About the Center for Financial Services
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