6 November 2014
The shared economy concept is already being embraced by companies such as travel site Airbnb and car-sharing site Bla Bla Car. It’s disrupting multiple industries and the implications for the smart use of real estate are huge.
“The biggest risk we face is that outdated institutions and outdated ways of thinking about things are inhibiting how we move forward,” says Jeremy Sheldon, Managing Director, Markets, JLL Asia Pacific.
Consumer-facing shared economy concepts grab the most attention in popular culture. For example, websites that encourage collaborative consumption, such as DogVacay (pet hosting for travellers), RelayRides (car sharing with neighbours), Fon (a network of people willing to share their WiFi service) and Lending Club (financial crowd sourcing). But there are equally revolutionary approaches that impact B2B companies and the traditional working world.
“It’s about how you use shared resources,” Sheldon says. “A typical occupier does not use an office building 24/7. Leases are often written in a way that means you should not be there overnight and the nature of today’s working patterns mean space is often underutilised. This needs to change.”
Clearly, embracing shared economy practices can reduce the amount of office space that is required overall. The installation of open, shared resources also spills over to city planning. It could revolutionise the use and positioning of parks, or drop-off spots for car or bicycle sharing, for example.
There are implications for retail, too. A site such as Poshmark—which allows people to buy or sell their clothing via a mobile app, display their wardrobes and find people with similar tastes—could transform the role of physical storefronts while the courier service becomes the key mode of commerce.
“The shared economy has all sorts of implications for real estate if we can make it happen,” Sheldon says. “While the traditional rules for occupation of real estate are often written in such a way that would inhibit that sharing, there are examples of collective success.”
In the US, JLL's Space ExchangeTM service adapts shared economy principles to help companies satisfy short and medium-term space needs. The cloud-based marketplace technology, powered by LiquidSpace, enables transactions to be completed on-demand via simple web and mobile apps.
In Asian countries such as Vietnam, space-sharing initiatives are supporting startups and the concept is rapidly emerging among technology incubators.
In a session at the recent World Economic Forum meeting in Tianjin, the inspirational story of Mark Pollock convinced Sheldon of the power of collective thinking and the shared economy.
Pollock is an Irish explorer who, having gone blind at the age of 22, embarked on an epic two-month expedition to the South Pole.
Following this feat, he was left paralysed by a freak fall from a second-storey window in 2010, shortly before he was due to be married. He fractured his skull and broke his spine.
Pollock was told by his spine doctor that he would never walk again and would always be limited in his capacity. Determined to recover some mobility, he set about linking medical doctors with engineers and conventional medicine experts with more exploratory and ‘fringe’ therapists.
As he notes through the Mark Pollock Trust, he seeks “to connect scientists, technologists, physiologists and funding foundations so that they engage in collaborative scientific research”.
The ultimate aim is an eventual cure for paralysis, brought about by an entrepreneurial approach to both research and fundraising.
It’s a different approach to the shared economy concept; one in which cooperation across disciplines could produce new fields of research and work.
Pollock’s speech in Tianjin was scheduled to inspire creative thinking among business leaders and The World Economic Forum selected him as a Young Global Leader this year.
“He is connecting people that hadn’t thought of working together before and pulling them toward a shared goal,” Sheldon notes.
“I hadn’t thought about how an individual, solely through the force of his own personality, could break down barriers between an old problem and a new solution.”
As real estate evolves, the way we occupy it, develop it and market it, the principles of Pollock’s shared economy could kick-start a new kind of collaboration.