The world of commercial real estate moves fast, with responsive buyers and tenants keen to grab first-mover advantage. To meet this challenge, real estate firms are embarking on a range of innovative initiatives, digitizing processes to make them more efficient and user friendly and to enable more data to be analyzed and accessible online in real-time, according to KPMG’s 2020 real estate advisory.
Cushman & Wakefield is one such commercial real estate company turning to new technologies to keep pace with the rising demands of business property owners and tenants while delivering time and cost savings. So committed is the frim to proptech-driven innovation that it has now developed its own in-house innovation hub.
As part of its innovation efforts, the Chicago-headquartered company has embraced the use of digital twins to accelerate the process of listing and renting commercial properties for both landlords and tenants. Digital twins, which leverage data to develop virtual representations of real-world entities and processes, have been gaining traction across a range of industries of late. With 400 offices across 60 countries, Cushman & Wakefield saw an opportunity to shorten the sales cycle and provide more personalized services to its clients by creating these digital representations of its commercial sites.
“You just have to look at brokers and project managers, for example, who can streamline their processes and how they can connect to their customers. And then in terms of how they visualize with tools, how they look at the space, and how they can play around with that and make decisions, that then creates a great opportunity,” says Oliver Skagerlind, global head of client and business solutions and interim co-CIO of Cushman & Wakefield. “So things like digital twins play a very important part when connecting to the clients.”
Real estate gets virtual
In creating digital twins, Cushman & Wakefield can better work with clients on finding the right site and ensuring confidence that the property chosen will suit their needs.
“From a digital twin perspective, we are able to offer clients what we refer to as a kind of turnkey solution, which entails scanning commercial properties in 3D across multiple service lines within the business,” says Skagerlind.
Cushman & Wakefield first trialed Matterport digital twin technology for 24/7 virtual tours in 2015, but it was during the height of the pandemic that the technology become integral to the firm’s business operations, resulting in more than 1,000 digital twins of buildings using Matterport’s capture technology. “And we’ve effectively digitalized over 33 million square feet of properties, using a combination of our in-house Matterport cameras and the capture services,” he says.
Cushman & Wakefield, which found itself oversubscribed in the number of tours it was doing, greatly benefited from the technology throughout the pandemic, and even as in-person, in-situ viewings have returned, the firm is still seeing significant uptake in utilizing the digital twin offering. Skagerlind says it is part of the strategic partnership strategy and how it delivers innovation tools “right across our different service lines that ultimately generate insight and create value for our clients.”
Matterport’s 3D virtual tour solution uses proprietary hardware and software to capture images, and leverages a cloud-based interface to access the virtual representations. “And then it’s obviously pieced together for that kind of immersive online experience to our end users, or brokers or client-facing professionals to use. It provides that end-to-end service from our perspective,” Skagerlind tells CIO.com.
“We’re able to showcase all of the properties to prospective tenants and buyers in a virtual environment with dimensionally accurate digital twins,” Skagerlind says. “The user is able to walk through the captured space at their own pace in their own time as if they were on site in person.”
Moreover, Cushman & Wakefield’s experience in adopting digital twins has boosted its ability to act in an advisory role for clients that are appraising new technology for their own use. “It actually helps with our clients and where we can offer services and advise them around best-in-class technology solutions,” says Skagerlind.
The role of digital twins
Driving the recent push for digital twins across all industries is a desire to improve service offerings, increase profitability, and augment productivity. The market for digital twin technology is expected to experience a compound annual growth rate of 50% up to more than $184 billion by 2030, according to P&S Intelligence.
Even with the benefits to be had, deploying digital twin technology across a global corporate property portfolio presents its own set of challenges and risks. For commercial real estate tenants, there is a need to show that a space can accommodate their full range of requirements, such as fitting specific equipment or safely occupying a building. And given the scope of industries Cushman & Wakefield serves, as well as its widening geographic footprint, the firm needs to be consistent in the way it attracts owners and tenants to showcase and explore its property listings.
Above all, the move to digital twins needed to be undertaken as a complementary creation that exists alongside the physical dwelling, says Skagerlind, who doesn’t see digital or virtual offerings as a replacement for in-person, in-situ viewings, but as a complementary tool for helping prospective buyers and tenants glean different insights when investigating a space and its possibilities.
“They absolutely complement, they don’t disintermediate the sum of those services, but what it does do for our clients is it helps with information and insight around their clients. It helps, therefore, with retention, it helps with delivering a better occupier experience, or tenant experience, while at the same time, helping with saving time and delivering potentially cost saving opportunities as well,” he explains.
Creating an in-house innovation pipeline
For Cushman & Wakefield, embracing digital twins is just one aspect of its approach to looking to technology to gain an edge. It has embraced innovation as a continuous process for finding, appraising, and realizing opportunities from new technology. Its Global Innovation Hub “is all about what’s next on the horizon from a proptech perspective,” says Skagerlind, who leads the hub’s efforts.
Through the hub, Cushman & Wakefield seeks to gain an understanding of new proptech’s potential. “It’s asking: What does it mean for our clients? What does it mean for our client-facing professionals? Can we partner with those firms? Can we make investments with those firms? And what value do they bring to the internal business and what value do they bring to our clients,” Skagerlind tells CIO.com.
The business value derived may be cost savings, sustainability improvements, time savings, improving digital transactions, and so on. The two-year-old Global Innovation Hub initiative gives the firm the ability to look at the developments, investments, and themes across the proptech market. Drawing up a watch list is a way to monitor the changing space and help Cushman & Wakefield make decisions about their viability.
“We’ll look at them in their company lifecycle. Where are they on that lifecycle? Are they newly formed? What’s their exit strategy? How are they penetrating into particular markets and segments? And from there, we’ll make a decision around both partnership and investment,” he says.
“We see proptech having a permanent transformative impact on the commercial real estate.”