by Lenny Pierce, Research Analyst
Last Thursday afternoon, the Seaport’s District Hall hosted DisruptCRE, a “first-of-its-kind commercial real estate/technology event designed to connect disruptive ideas with capital and commercial real estate professionals.” The event consisted of four panels that focused on the major players in the modern disruption of commercial real estate, new theories regarding workspace utilization, crowdfunding as it applies to real estate projects, and the energy use and sustainability of modern buildings. A thematic through-line of the afternoon was the idea that there currently exists a major gap between the current MO of commercial real estate and the emerging technologies that could change it for the better.
The first panel, Meet the Disruptors: Innovators Driving Change, featured notable thought leaders in the modern disruption of commercial real estate, including CBRE’s own Elie Finegold. Duke Long, who has been disrupting real estate long before it was cool to be disruptive, moderated the panel. These “disruptors” stressed how technology has the power to facilitate networking between real estate professionals and how the mobility it affords these professionals will only work to streamline their operations.
The energy efficiency of buildings was discussed in a panel titled The Science of Building Systems. Panelists identified data-driven operation cost tracking and increasing pre-fabricated building materials as major forces that could make the construction and operation of buildings far more efficient going forward. The panelists also discussed some avenues for utilizing the heat generated from data centers—a resource that is routinely wasted. Buildings across the world have started to pump in heat from neighboring data centers in an effort to minimize their heating bills. In 2011, Microsoft even proposed applying this concept to heating homes in a paper titled The Data Furnace: Heating Up With Cloud Computing.
Participants on the Inside the Box: ReThinking Space panel discussed the increasing density of workspaces—a trend that will only gain momentum since at present only 40% of space in the typical office is actually used for working. These guests also spoke to the decreasing value of privacy in the modern office, noting that the collaboration afforded by an open work environment is more useful than any exclusivity individual employees might lose. Naturally, any business will have the periodic need for privacy, meaning that a workspace completely devoid of closed quarters is unlikely. That, along with the constant struggle against corporate inertia, will likely mean a happy medium will be landed on that allows for both dynamics.
The Crowdfunding: A Tectonic Shift in Real Estate Investing panelists discussed the latest emerging avenue for investing in real estate—crowdfunding. Panelists Benjie Moll and Bonnie Burgett, founders of “democratized” real estate investment platforms (Arx Urban Capital and Sourced Capital, respectively), discussed the challenges to crowdfunding real estate projects, including the lack of face-to-face interaction with actual real estate professionals. Ultimately. they felt that minor anxiety-inducing kinks like this are outweighed by the inherent value of an investment space so perfectly catered to young entrepreneurs—a group that has traditionally had difficulty securing funding through traditional methods. An institutional investor might be wary of an innovative real estate project managed by a 26-year-old, but a similarly “green” 26-year-old investor may not be. Could the best way to combat skepticism be to stop talking to skeptics?
The event closed with a series of 20 super-condensed business pitches from tech startups in the commercial real estate industry. Very much in keeping with the theme of efficiency, each pitch had to stay under 45 seconds, forcing the representatives to boil their business models to 4-5 sentences.
For more information about DisruptCRE 2014, visit www.disruptcre.com.