Commercial property developers must adopt digital technology as the demands of tenants change, one of the Republic’s leading property investors has said.
In a report, Shaping our Cities, IPUT argued that the property sector had been slow to embrace the digital revolution, with one estimate suggesting the sector was behind other industries by as many as five years.
Its report looks at how property owners should begin to reassess their business models over the coming decade.
“Commercial real estate has been slow to adopt new technologies. The traditional business model of letting properties on a 10-20 year basis has not demanded it. But things are changing,” IPUT said, citing the rise of alternative investors such as WeWork.
Nevertheless, it said that changing demand had brought an opportunity for investors and developers to rethink solutions to improve “efficiency gains and additional revenue streams”.
“There is now a critical need for the real estate community to invest in sustainable buildings and the public realm,” said IPUT chief executive Niall Gaffney.
“As we commence the development of almost 65,000sq m of mixed-use space in Dublin city centre, we saw an opportunity to explore the key digital drivers of change in real estate globally and ensure we are delivering stock that is at the industry’s cutting edge. Drawing on this research, we can apply global best practice to our projects for the benefit of our future occupiers and support long-term returns for our shareholders,” he said.
IPUT controls 470,000sq m of office space with a net asset value of €2.62 billion. Within its portfolio is 10 Molesworth Street, occupied by AIB; 28-29 Grafton Street, occupied by Victoria’s Secret; and 1 Grand Canal Square, occupied by HSBC, Accenture, Bank of Ireland and Citadel Securities.