It’s been a busy year for the real estate industry – and we’re not just talking about bumper deals or ever more ambitious developments moving from blueprint to reality.
The speed at which the changes are driving the industry forward – whether through technology or the movement of people – is increasing and it’s having a big impact on the design of buildings and cities, the way that industries from hotels to warehouses operate and how we go about our daily lives.
Here Real Views picks out some of the key trends of 2015.
Every day more people are moving to join the throng of city life – and they all need their own bit of space to call home. Problem is, land is scarce and cities are becoming ever more overcrowded and expensive. For some cities, for example in China, growing outwards is a possibility, which is creating big challenges for the government both in terms of how the make these urban areas sustainable as well as successful.
For New York, one option is to build ever higher – and apartment prices are rising as fast as the skyscrapers. In contrast other U.S. cities, such as Atlanta, Chicago and Los Angeles,are welcoming a new influx of people – mainly millennials – into their inner city areas after suffering the effects of suburban flight over the past few decades.
In Asia it’s a very different story with developers shrinking the size of apartments to keep prices within the realms of affordability. However, density doesn’t need to be a dirty word when it comes to city development – it’s all about creating well-designed developments include a mixed use of land that provides people with liveable and spacious areas in which to work, relax and enjoy a high quality of life.
In Europe some cities are seeing changes to their historic skylines as new developments take them into a new era. In London there are at least 39 new residential towers in the pipeline while Paris is getting ready to welcome a new addition to its own skyline with the Tour Triangle.
Innovative new technologies are fast making inroads in real estate. Warehouses areembracing smart technology to improve processes and efficiency while the growing expectations of online shoppers are driving retailers to pursue ever faster delivery times across their logistics networks.
Retailers are also increasingly turning to technology to connect with consumers and improve their shopping experience. And offices are embracing the concept of virtual reality to allow investors, potential tenants and future office workers to ‘see’ their space months or even years before it is built.
This year has really seen the rise of the robot. From improving productivity in the workplace to manning the reception desk in hotels, robots are revolutionizing the real estate industry. Asia is staying ahead of the curve with high-tech indoor agriculture toolstransforming farms into factories.
Elsewhere, 3D printing is gaining traction with Dubai unveiling plans for the world’s first fully functional 3D printed office, hot on the heels of Chinese company WinSun which unveiled a five storey apartment building and a 1,100 square meter villa earlier in the year.
The Philippines followed up with the world’s first 3D printed hotel suite and is exploring the potential of 3D printed buildings to provide housing in low income and disaster struck areas.
Equally innovative are the flatpack skyscrapers from Chinese company Broad Sustainable Building. Earlier this year it completed the world’s tallest flatpack skyscraper at 57-storeys in just 19 days.
Sustainability has grown from being a ‘nice to have’ to a ‘must have’ for companies, developers and city planners. Even countries such as China are investing time and money in improving their environmental footprint while others, such as Canada, are showing the world why sustainable buildings are important.
Buildings are also becoming increasingly equipped with sophisticated sustainability measures such as photo-chromic glass and lighting systems. And a growing number aresporting green roofs providing space for residents to relax as well as delivering environmental benefits. However, the real change happens when communities work together to create green districts which are springing up all over the world from South Korea to Germany.
By: Rhian Nicholson of JLL Philippines (December 21, 2015)
Investors look beyond emerging markets
“We’ve seen emerging markets partly fall out of favour in 2015, with investors spooked by China’s equity market correction, the effects of lower commodity prices on many emerging economies and the potential negative impact of rising US interest rates on foreign exchange rates in emerging markets. As such, we’ve seen direct commercial real estate investment into emerging markets (excluding China) fall by a third in the first three quarters of 2015 from 2014 levels.
“But when we start to unpick the dynamics, we’re seeing a greater divergence in the real estate performance of emerging cities. The more agile emerging cities and those that are successfully transitioning to higher-value business services and IT are bucking the trend – I’m thinking of places like Shanghai and Shenzhen in China, and Bangalore and Hyderabad in India.
“Nevertheless, investors still have an appetite for risk, and so they’re targeting secondary and tertiary cities in the mature economies – with strong interest in smaller New World Cities like Munich, Stockholm, Austin, Seattle, Melbourne and Auckland.”
Developing trends, economic growth stories and new innovations have all played a part in shaping the global real estate industry in 2015.
As it draws to a close we ask JLL experts from around the world for their highlights of the past 12 months and the implications of these both within real estate and the wider business world.
From the growing strength of Chinese companies to rising investor interest in emerging batch of New World Cities to new construction materials with huge potential for our future towers, click through the slides above for a snapshot of the standout real estate trends and developments of 2015.
By: Jeremy Kelly, Director, Global Research, JLL (December 28, 2015)