Opportunities abound at the intersection of tech and property

COMMENT We’ve grown so used to seeing some of the biggest businesses in tech moving into real estate that we may have lost sight of another phenomenon: some of the most influential individuals in that world are moving into this one too. You’ll recall that last month EG interviewed Dan Doctoroff, founder of Sidewalk Labs, the urban innovation arm of Google’s parent company Alphabet. Previously chief executive and president of Bloomberg, and deputy mayor for economic development and rebuilding for the City of New York, Doctoroff told EG that Sidewalk Toronto was “by far the most complicated thing I have ever worked on”. In other words, he saw the opportunity that connecting real estate and tech presented, and he seized it. Meanwhile, Miguel Gamino, formerly CIO of San Francisco and CTO of New York City, is now at Mastercard where he is tasked with turning the financial services giant into a global leader in the development of future cities. (Gamino is speaking at next month’s EG TechLive event; more details at www.egi.co.uk/tech-live-2019). And this week we speak to RJ Pittman, who took the reins at Matterport in December and plans to expand the business beyond pure real estate to become “Google Maps” for the built environment. Pittman’s CV reads like a who’s who of Silicon Valley’s most successful businesses; he played key roles at Apple, Google and eBay, which he joined in 2013 as chief product officer. With their backgrounds, Pittman, Gamino and Doctoroff could have walked into just about any big corporate job. They chose the intersection between real estate and tech. Think about that. And then think about the scale of the opportunity that presents to the enlightened, and just how real the threat is to the resistant. An office market where slowing economic growth and geopolitical risk is putting rental growth under pressure. One where tight supply does present an opportunity, especially for prime assets. And one where demand from tech companies remains robust. If that sounds like your market, take comfort; most major cities around the world are wrestling with similarly mixed driving forces. Take Hong Kong, for example. It will remain the world’s most expensive office market despite rents being forecast to decrease in 2019, according to Knight Frank’s first Global Outlook Report. And in terms of risk, for Brexit read the US/China trade war. Meanwhile, the juicy combination of tight supply and employment growth in Melbourne and Sydney means the Australian cities will see the largest rental growth in 2019, with rents rising by 10.1% and 8.6% respectively. So don’t think for a moment that London, and other UK cities, are uniquely challenged. Interestingly, rental growth in Birmingham will outstrip rental growth in the City of London over 2018 and 2019, according to Knight Frank. But it’s worth noting that our impending departure from the EU has not deterred property investors so far from investing in the capital. In 2018, investment in London property hit €30.6bn (£26.8bn), 21% above its 10-year average, according to CBRE. Its closest European rival, Paris, saw investment volumes reach €23.5bn. Yes, that’s 46% above the French capital’s 10-year average, and up 14% on the previous year, but it’s still some way short of London’s inbound total. And at a time of – arguably, hopefully – peak uncertainty for the UK too.   To send feedback, e-mail damian.wild@egi.co.uk or tweet @DamianWild or @estatesgazette