Work of the future set to transform NZ property markets
Rapid changes to the way we work will soon have a big impact on our property markets, according to a visiting expert in property technology.
Jordan Kostelac, Asia-Pacific director of PropTech for global real estate services firm JLL, has been in New Zealand to speak at JLL’s “Year of Transformation” thought leadership events.
He says just as smartphones have changed the way we live, so too are they changing the way we work: “We’re moving deeper into the Augmented Age,” Kostelac says. “Portable devices now influence how we eat, travel, pay, record data – yet they’ve only been firmly entrenched in our lives for a decade.”
“The future of PropTech includes buildings with augmented capabilities: the ability to hold a device up to a building and see all its vital data, inspect plans, get instructions for repairs, or report an issue.”
Other disruptors Kostelac says are set to dramatically impact commercial real estate in the next three years are the ‘sharing economy’ and co-working, which emphasise communal spaces; and the Internet of Things, which allows devices to talk to each other and thereby streamline our activities.
Kostelac adds that traffic congestion is problem for PropTech: “Commercial tenants and buyers have rising technology expectations, requiring more expenditure upfront. But why would a developer spend more money to create enhancements if people can’t get to them?”
Paul Winstanley, Head of Research and Consultancy at JLL New Zealand, says the lines between real estate sectors are increasingly blurred, with more focus on providing a product for consumption.
"The future of work – whether in the office, shop or warehouse – is in combining creature comforts with a collaborative, carefully-crafted workspaces infused with technology,” Winstanley says.
"Retail is drawing customers with innovations like ‘enter-tailing’, combining retail with entertainment. Industrial is no longer solely driven by manufacturing but also logistics or the opportunity to switch to big box retail. And, of course, residential now needs to be geared to be able to work from home."
Winstanley says all of this ties in nicely with Auckland Council's future plans for the city: "Their concept is to work, play, and live; all in one space with convenience, the value of time, better transportation options, and improved shared spaces being at the heart of the city’s future development."
But he warns that low-tech properties are increasingly difficult to sell or let: “Across the country we’re seeing wider gaps in yield trends for prime and secondary assets, across industrial, retail and office.”
Todd Lauchlan, Managing Director of JLL New Zealand, says 2019 will be a Year of Transformation for his firm, as it leverages the global brand and technology of JLL.
“We have 90,000 employees worldwide, half of them in the Asia Pacific region, who can help our Kiwi clients reach global markets and opportunities. In particular we will be working more closely with our Australian counterparts, as well as tapping into the APAC region," says Lauchlan.
"At the same time, the uniqueness of the New Zealand offer will remain central to everything we do, and with so much on the local agenda – including high levels of construction, labour shortages, public transport investment, the ban on foreign buyers, and a population tipped to soon cross five million – the New Zealand property market is undergoing a major transformation too,” Lauchlan concludes.