April 2021
Fluxus is a member of the World Economic Forum’s Future of Real Estate community, committed to transforming buildings and cities to be more liveable, sustainable, resilient, and affordable.
“Buildings and cities are vital to societies and economies. They are the vehicles through which people live their lives: they bring people together, provide respite, shelter and inclusion, drive businesses, support or damage health, and nurture creativity. The last year has brought the convergence of multiple crises – public health, social, economic and planetary – to a crescendo and, with it, a reckoning for the real estate community.”
– World Economic Forum Future of Real Estate
The Framework for the Future of Real Estate
The World Economic Forum’s Real Estate CEOs have developed a vision for the future of real estate. It is a future in which buildings provide comfort, are equipped for the most unprecedented events, support human and planetary health, and are affordable and accessible for all of society. It is a vision in which the real estate of the future is liveable, sustainable, resilient and affordable. To deliver on this vision, this Framework for the Future of Real Estate was created to provide a pathway for the industry to transition, drawing upon best practices and business solutions from successful case studies provided by World Economic Forum Partners around the world.
In the report:
The rise of real estate
Real estate is a major investment asset class that accounts for 10% of global GDP. The past decade has been one of unprecedented growth in value (+3% compound annual growth rate) and rising investment volumes (+14% compound annual growth rate) as historic low interest rates, record “dry powder” (reserves) and the increasing securitization of real estate have driven significant investment.
While investors became increasingly cautious in 2019, the asset class remained highly liquid with a stable spread relative to senior sovereign debt and solid returns, proving its resilience and stability. The growth of real estate, however, has come with several significant challenges, including fragmented regulatory frameworks, high carbon emissions, a severe dearth of affordable housing, slow technology adoption, a lack of transparency and inadequate resilience.
The way forward
Society now, more than ever, needs to collaborate to protect public and planetary health by managing both the immediate and longer-term implications and finding permanent solutions.
Assets of every type must be developed and retrofitted to move towards net zero carbon targets and ensure resilience against a variety of shocks. Offices will need to evolve to drive collaboration and well-being. Housing must be high quality and affordable. Industrial assets should be digitalized to drive efficiency and innovative in design and location. Retail real estate must leverage technology to drive the customer experience and complement online channels. Hospitality must cater to guests with more personalized services and reinvent offerings.
The COVID-19 pandemic presents both the public and private sectors with the opportunity to accelerate the transition to deliver real estate of the future.
– The Framework for the Future of Real Estate
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