On March 29th, 2018, Ryan Simonetti, Co-founder and CEO of Convene, gave a keynote presentation at the 4th Annual DisruptCRE – New York City event on the Future of Space as a Service.
Simonetti began by clarifying the enormous impact of tech on day to day life, asking the crowd who owned smartphones, Airbnb and so on. “If I told you a decade ago that your life would be in your pocket, that you could get everything you needed without leaving your apartment or your home, that you would sleep in a random’s bed, or even worse, let a random sleep in yours, would anyone have believed me? No,” he said.
He pointed out that with this has come the fact that the way people work and use real estate has changed permanently. However, he stressed that trendlines are more indicative of the future than headlines.
He identified five key trends that will have a major impact.
1- Demographics (Millennials having more purchasing power, and taking over the workforce)
2 – Technology
3 – Urbanization
4 – Resources
5 – Globalization
He went on to address the impact these trends would have on the future of commercial real estate decision making from office design, to communication and work styles, not to mention a boom of new industries and solutions. For example, he pointed to data which showed that 67% of businesses globally are now choosing flexible form workspaces, such as WeWork.
He also pointed out how this tech-centric world would be quick to eliminate things that don’t make sense with new solutions. For example, walking through the same office you’ve been through fifty times and doing the same security check over and over.
He offered a few predictions based on these trends.
The largest landlord in the world will “own” no assets, just as the largest retailer has very few stores, and the largest hotelier in the world owns no hotel inventory.
All office buildings will be smart buildings.
“Third places” will be the first preferred workspace category.
The majority of Fortune 500 companies won’t hold long-term leases.
The average commercial lease term will approach one year.
His final thought with these massive changes headed toward the industry? The following Chinese Proverb: When the winds of change blow, some build walls and some build windmills.”