2A — August 24 - Sept. 13, 2018 — M id A tlantic
Real Estate Journal
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M id A tlantic R eal E state J ournal Publisher, Conference Producer . .............Linda Christman AVP, Conference Producer ...........................Lea Christman Account Executive ........................................... Steve Kelley Account Executive ............................................. Kim Brunet Account Executive ........................................ Marisol Chase Senior Editor/Graphic Artist ..........................Karen Vachon Office Manager ...............................................Kerrin Devine Contributing Columnists: ....... Revathi Greenwood, Sandy Romero, Cushman & Wakefield; Mid Atlantic R eal E state J ournal ~ Published Semi-Monthly Periodicals postage paid at Hingham, Massachusetts and additional mailing offices Postmaster send address change to: Mid Atlantic Real Estate Journal 350 Lincoln St, Suite 1105, Hingham, MA 02043 USPS #22-358 | Vol. 30, Issue 16 Subscription rates: $99 - one year, $148 - 3 years, $4 - single copy REPORT AN ERROR IMMEDIATELY MARE Journal will not be responsible for more than one incorrect insertion Phone: 781-740-2900 | Fax: 781-740-2929 www.marejournal.com The views expressed by contributing columnists are not necessarily representative of the Mid Atlantic Real Estate Journal
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Revathi Greenwood
Will Robots Take Over CRE?
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A report released today by Cushman & Wake- field, examines trans- formative technologies and how they will impact commercial real estate over the next two decades. The report is the first in a four-part series that focuses on auto-related technologies such as electric and autono- mous vehicles and ridesharing; distributed ledgers such as blockchain and cryptocurrency; and technologies transforming supply chains such as drones, 3D printing and autonomous mobile robotics. Will Robots Take Over CRE? focuses on structural factors that may drive adoption of these technologies and evalu- ates transformative advances that will affect them, all within the context of safety, secu- rity and acceptance; ability to converge with other technolo- gies and infrastructure; and scalability. Each technology is evaluated on a “Hype Cycle” curve that gauges its likelihood of being adopted. Real estate and infrastructure assets are expensive, built for longevity and do not lend themselves to flexibility. Therefore, in order to embrace any change, play- ers in CRE markets must be convinced that the technology will be widely adopted. The report also addresses the impact of innovation on future employment and identifies cit- ies and real estate asset types best positioned to withstand the change. Today, technology is a net job creator. Looking forward,
certain sectors are at risk, especially manufacturing. A 2018 study commissioned by the Organization for Economic Co-operation and Development (OECD) puts the number of jobs at risk of automation at 14%. In the U.S., that is an estimated loss of 13 million jobs. Yet, one study has estimated that one additional job in the technology sector generates about 4.9 new non-technology jobs in the same city (three professional and two nonprofessional positions), as new jobs create additional de- mand for local services. “Despite all the doomsayers, new technologies have created more jobs over the last century than they have eliminated,” said Revathi Greenwood, Cush- man & Wakefield Americas head of research and lead author of the report. “Even so, certain job functions are being decimated by technology, and in some cases robots are indeed coming for your job.” But not yet, as most of the technologies under consider- ation are at least a decade away from widespread adoption. Whether that is perceived as a short or long time depends on how ready one is to cope with the aftermath. Of course, many of these technologies will be ad-
opted on a use- or case-specific basis with limited functions and in select geographies. They are unlikely to materially affect CRE in the short term. Once a technology is widely adopted, there is likely a lag in terms of the impact on real estate. “This lag should not be viewed as a ‘wait and see’ period. Rather, the early adop- tion cycle should be used to determine impacts and possible remediation strategies,” said Sandy Romero, Cushman & Wakefield senior analyst and co-author of the report. “The risk to CRE is that, should underlying patterns of human/ business behavior change more quickly than the real estate or infrastructure can adapt, a technology could lead to weaker CRE performance.” Going forward, cities that invest in training will also be better suited to weather tech- nological shifts. However, once adoption becomes widespread, cities with technologically pro- ficient workers – such as San Francisco, New York, Washing- ton D.C., Boston, Austin, Texas, Los Angeles and San Jose – will be in a better position to benefit from the economic impact asso- ciated with these technologies. continued in the Sept. 14th Edition
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