Sustainable real estate means that we have to look
far into the future
Wild Cards: Risk Management
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Big strategies often overtaken by eventsWorld can change faster than you can hold a board meeting
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£ 375bn
$2.3 trillion US + $65bn per month
AGILITYmeans more than
one strategy or future for every building
• Global economy never stopped growing
• Impact on real estate in London / UK
WGP 1980-‐2013 (%,constant prices)
US GDP 1980-‐2013 (%,constant prices)
EU GDP 1980-‐2013 (%,constant prices)
Vietnam GDP 1985-‐2011
>40% WDP by 2015� IMF - adjusted for Purchasing Power Parity
300 million move to cities in China and475 million to cities in Africa by 2030
Europe Dying 4 couples to produce single great-grand child
1 week every 4
Future of real estate is about
EMOTION
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Future of Offices Breathing same air
People love Cities
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Cities keep crowds together so cities help protect countryside
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Commute for Community
TeleworkingOnly 2.5% of US workers are exclusively home-based60% UK office workers have opportunity to work from home regularly - but few take it (during office hours)
Tele-‐presence 20% growth pa $4.5 billion
But video is unpopular at work
Future of Retail
Shopping Malls Leisure + Experience
Local Convenience
Boom
70% customers live only 600 metres away
FusionOn-‐Off line
Global e-‐commerce $1.5 trillion 201412% of all retail is online in UK
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Mobile RetailMobile influences $29bn of retail sales in UK50% of all UK online sales are using mobile
Over 4000 road hauliers in EU
1.3bn home delivered e-‐com items in UK a year (+12% pa)
Gold standard:10am orders for 3pm Delivery
10am orders for 3pm Delivery
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3000 Parcel Shops in UK in 12 months Chosen by up to 50% customers for
deliveries - help for local stores
Energy impact on real estate
$40 Trillion Green Tech Boom driven by oil price, cost cuts, green activism
Shale gas 33% US supplies
3.3m US jobs$468bn pa + more oil
produced than Saudi by 2020
200 years global supplyUp from 60 years in 5 years
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Boom
Bust
5 coal plants replace with gas = 9000 megawaPs wind Coal prices fall = more coal burnt in Vietnam and China
57 coal plants closed in US in 2012
120,000 terawatts of sunlight /day7,000 times total power useQUEBEC from ARIZONAMOSCOW from SAHARA
Solar cell genera\on cost parity
AVracWve Solar cell cladding on every building
120,000 terawatts of sunlight /day7,000 times total global power usePower Moscow from Libyan Desert
“40% EU power = wind by 2050”Surplus wind to hydrogen -‐ to methane ?
Australia Power Shortage
• 10% capacity used 4 days a year•Average $50 to peak at $10,000 per MWhr
Germany Power Surplus
• In June 2013• Electricity prices became negaVve • -‐ minus EU150 / MWhr !!
Managing peak demand�AutomaVc meter readings�Variable pricing�Time and weather sensiVve discounVng
Enough salt caverns planned to power Germany for a week
Power Storage
Electric Cars�>10% smallest cars electric cars within 10 years
�Increase night Vme power consumpVon by 20%
�Donate power at peak Vmes to balance grid
•Rapid growth HVDC Super Grids
• 500,000 S Korea jobs - $200bn Smart Grid Project
•China planning to power Moscow
Low energy streetlights
�Cost replacing all 120 m EU streetlights £300bn saving £50bn a year
�Market £15bn pa over 15 years�4 year payback
Smart heaJng or cooling Save 30-‐50% energy -‐ payback 4 years
• 70% new buildings in Sweden• 45% new buildings in New Zealand• Payback 15 years but boosts electricity demand
Heat Pumps save up to 50%
Eat or be Eaten !Living unWl next merger – or de-‐merger
E-‐Crete
�Concrete industry = 5-‐7% global CO2�Geoplymers such as E-‐crete (power staVon ash)�Jannie Van Deventer, University of Melbourne, Zeobond
�50% world’s concrete producVon saves 1bn tons C02 /10 years in real estate construcVon
Make Buildings Last 30% + of lifeVme energy use = build and demolish