Real estate industry: No digitization push because of Corona

Around 250 managers and real estate experts from Switzerland and Germany took part in the Digital Real Estate Study 2021. Although the participants rated their own digitalization maturity slightly better than in the previous year, digital process consistency in the real estate industry remains a vision, the study concludes. The study measures the extent to which real estate companies are addressing digitization and the extent to which they have already taken and implemented measures. The calculation is based on 25 indicators in five clusters and twelve technology areas. On a scale of 1 to 10, current digitization maturity across the entire market is assessed at 4.2, which corresponds to an increase of 0.3 points. The differences in the indices for Switzerland and Germany have accentuated again this year with 4.1 and 4.6. The Digital Real Estate Study was conducted for the third time.

"The slight increase in the index is due, among other things, to the fact that the degree of digitization is becoming more equal between the various roles. In the past year, property managers and FM service providers in particular have made gains in terms of digitization. Solutions such as tenant portals, the introduction of digital tenant files, the automation of the leasing process, and also new opportunities in building operations have certainly contributed to this improvement. The least advanced in digitization are the owners and investors - their digitization index is even slightly lower than in 2020," says Dr. Joachim Baldegger, study leader and Head of Service Unit Future Lab at the consulting firm pom+, which conducted the study together with Bauen digital Schweiz/buildingSMART Switzerland.

The picture is very heterogeneous when it comes to investment in innovation and digitization. Many companies allocate between 1% and 5% of annual revenue to this (43%). Around a quarter of respondents (24%) invest more than 5% of revenue. Owners and investors bring up the rear here, which may also be one of the reasons for the lower index.

The extraordinary situation surrounding the Corona pandemic is having an impact on digitization in the construction and real estate industry. Investments in internal process automation and digitization projects have been more restrained. As a result, digital technologies are being used to a lesser extent - with platforms and portals being the only exception.

"The focus of digitization shifted last year. Instead of optimizing internal processes, customer relationships were cultivated and improved," explains Baldegger. This development is understandable in view of the economic uncertainty, but the industry must be careful not to lose the digital connection even further. Baldegger comments: "The emerging changes in the area of new working models and the associated redesign and reorganization of office space contain great opportunities for innovative digital solutions. It is to be hoped that this development will not only affect collaboration, but will trigger a profound change toward a transparent, democratized approach to data."

"Digital process consistency? No way!"

This year's survey focused on Building Information Modeling (BIM). 63% of the respondents consider the application of BIM to be relevant for their company, with BIM currently considered to be most important in the design and construction of buildings. "However, the added value of BIM can only be realized across the entire lifecycle," says Alar Jost, co-author and vice chair at buildingSMART Switzerland. The survey results indicate that the importance of digital process continuity and automation is not yet fully understood and the solution path to establish BIM as the basis for a continuous data model of the building (digital twin) in the market is still unclear.

"We now have to work on the culture, the integration into the value chain and the level of knowledge. So the next steps are clear: We are challenged to develop universal data standards and open technologies that stakeholders can use across the board," says Jost, who as a BIM expert heads the corresponding service unit at pom+.