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Innovation

 

Real estate is a long-term investment

It is being shaped by structural trends that are now gathering pace:  
 
  • metropolisation, which is concentrating real estate assets in a few zones and leading to cities being built on top of cities;
 
  • the ageing of the population in European societies, which is creating new bed and service needs;
 
  • digital technologies, which allow people, and soon objects, to communicate, transforming business models;
 
  • the combating of global warming, of which real estate is one of the main drivers, which calls for changes in resource use, transforming processes and even changing how performance is expressed by including non-financial factors.  

Key figures

38%

Weight of real estate in CO2 emissions worldwide. Source: 2020 Global Status Report for Buildings and Construction, United Nations.

706

Number of cities with more than one million inhabitants by 2030, versus 548 in 2018 and 371 in 2000. Source: The World’s Cities in 2018, United Nations.

24%

Percentage of people aged over 65 in Europe by 2030. Source: Eurostat, 2019

100x

Thanks to 5G, 100 times more devices will be interconnected compared with 4G. Source: ThalesGroup

What impact does this have on real estate?

As historical trends intensify, the real estate sector is reinventing itself and seizing the opportunities offered by tomorrow’s world. Tenants and their complex needs are central to these transformations.

metropolisation

The fact that people increasingly want access to cities, where a growing share of human and financial capital is concentrated, raises the question of how inclusive major cities are. Real estate is at the forefront of these issues, with the development of affordable housing and hybrid facilities that form a fourth type of place (after coliving, coworking and comingling places) that may be used in a combination of ways(1).

ageing of the population

Whereas the traditional real estate format was based on a traditional family model, an approach according to the life cycle of individuals should now shape the residential real estate offering, from millennials (coliving) to the elderly (assisted-living housing), via families (build to rent).

the combating of global warming

The combating of global warming requires a new form of real estate management: resources are no longer unlimited, energy consumption and greenhouse gas emissions must be optimised and waste must be recycled. This new temperance is not at odds with financial performance and relies on a partnership between asset managers and tenants.

digital technologies

Technology is providing the tools needed to successfully carry out these transformations. The development of IoT (the internet of things) via 5G will gradually expand the possibilities for real estate assets, allowing more efficient management of employee mobility, optimised energy consumption, and access to a range of services … The business of the real estate manager is changing as a result of technology from simply making assets available to providing access to a user experience.
(1) Morisson, Arnault (2018). “A Typology of Places in the Knowledge Economy: Towards the Fourth Place”. New Metropolitan Perspectives. Smart Innovation, Systems and Technologies.

Ageing  of the population

  • A new residential path : an approach driven by the cycle of life.


 

Technologies

  • Promoting innovative solutions to enrich the service experience of the tenants

MEtropolisation

  • An inclusive city, a city where uses mix, where needs and know-how overlap, where talents and hard work converge.



 

fighting against global warming

  • Less yet better : the path to a low carbon real restate

Praemia REIM’s innovative mindset

A conviction-based thematic approach to asset allocation

Praemia REIM  has been a pioneer since 2012:
 
  • by offering its clients the chance to invest in real estate through thematic funds. The thematic approach ensures a “pure” performance profile for investors, which reflects the fundamentals of the real estate segment to which they are exposed, i.e. offices, retail, healthcare, residential or hotels. Investors may build their portfolio allocations according to their convictions and needs subject to this condition.
 
  • by giving its clients the opportunity to support socially useful sectors such as healthcare real estate (nursing homes, medical, surgery and obstetrics clinics and retirement homes), education real estate (nurseries, schools, universities and training centres) and affordable housing, through various dedicated solutions. The Covid-19 public health crisis has highlighted the need to develop private supply, in addition to public supply, to cater for future demand through a modern offering that integrates post-Covid standards. In the coming years, we will step up our investments in real estate sectors with a high social utility. These meet the public’s growing needs (housing for dependent elderly people, a wish for community, proximity to place of work or study and access to healthcare) and require larger investment capacities(2).  
   

Integrating the new types of real estate use

Our teams work with the Research & Strategy department to analyse changing real estate trends. They are committed to constantly communicating with tenants so that they are able to learn about their current and future needs. They participate in various working groups focused on changes in real estate and new types of use, including:
 
  • New types of residential use (build to rent, micro-apartments and coliving).
 
  • Structures to accommodate the elderly (hybrid spaces and inter-generational living).
 
  • Educational structures (multiple sites and digital teaching).
 
  • New working methods (hot-desking, flexible office spaces and plug-and-play systems), and so on.

Innovation is central to Praemia REIM's operating methods.

A multi-disciplinary new use committee

We have created a New Use Committee whose aim is to anticipate the main future real estate trends and integrate them in our offering.  This multi-disciplinary committee brings together Primonial REIM’s various areas of expertise and third-party stakeholders and is chaired by Praemia REIM’s Chairman & CEO, Laurent Fléchet.

It meets once a month, hears from numerous PropTech companies and works on themes such as blockchain in real estate, the future of coworking, the optimisation of energy consumption, the modernisation of leases, flexible ownership, the internet of things and smart buildings.
 

Strategic partnerships with PropTech companies

We are also establishing partnerships with PropTech players, to integrate technological changes entailing new ways of understanding real estate, and to accelerate the digitalisation of our operational processes to improve our performance.
 

A Research & Strategy department to analyse megatrends and participate in discussion groups on the future of real estate

Our Research & Strategy department produces macro- and micro-economic analyses and research reports on the demographic and societal trends that are affecting the real estate markets.
 

Let’s change real estate together

Are you a PropTech company specialised in data processing for the benefit of clients and the user experience? Do you offer digital solutions as a way of improving processes, operational efficiency and the client experience within buildings, maximising the use of spaces and responding to ESG issues? Through our continuous improvement and adaptability process for our real estate offering we aim to integrate innovations in the value that we create, particularly by working with an ecosystem of partners.

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