Tangible or non-fungible: what is the future of real estate?

EDITOR’S COMMENT Property is tangible. That’s what makes it so great. We can touch it and feel it. We can be in it. We can interact with it. Even if markets crash and the value of your property falls to nothing (or negative), you still have the actual bricks. You still own a thing that you can go in and use in some way. That all makes sense to me. I’m not ashamed to admit that what I struggle to make sense of, especially after the two years of physical isolation we’ve all just been through, is the slow but growing obsession with buying “land” in the metaverse – land or properties that don’t actually exist. There are no bricks and mortar, just ones and zeros, just code. I remember playing Sim City as a kid and building cities and thinking that was cool. I remember (vaguely) Second Life, a weird virtual world where you could buy stuff. But those were games, right? Those weren’t where real life happened. Now, of course, I don’t want to be one of those people who dismissed the internet as something that would never take off. I love the internet. Where else would you have free access to an unlimited supply of cat videos? The metaverse is clearly a thing, and something that people are using to interact with each other, to attend concerts, to go shopping, to play games and increasingly to buy commercial real estate. And people are starting to make money. A retailer taking a “lease” in a virtual world is buying advertising and, if we think about it, isn’t that really what a physical shop is today? It’s a big billboard that we can enter, have a little browse around, maybe try out a few things, and then probably buy whatever we were looking at on our phone. So, I kind of get it. I can see why people are excited about it. And I’d love for EG to be in there somewhere – hosting events, being in a shop window, using our data to help build a better world. But, I just have this nagging feeling that this might distract us from what we need to do in the real world. Isn’t the creation of a metaverse just where capitalism and consumerism goes next? I’ve made all the money I can make in this world, I’ve bought all the stuff I can buy in this world, let’s create somewhere new so I can make more money and buy new stuff. I love innovation and creativity, but let’s not forget what is left behind. My mind takes me to the very excellent Wall-E when I think of this and what (in the movie) the earth has become, what humans have become. It is quotes from investors in the metaverse that make me worry. “This is going to be a multi-trillion-dollar industry,” Andrew Kiguel, the Canadian founder and chief executive of crypto and NFT investor Tokens.com, tells us. Great. But so what? Maybe its just that the purpose of real estate and the built environment hasn’t been communicated yet. Could we use this virtual world more as a model for how we can do things better in the real world? Could we use it to teach us to manage carbon emissions better (although a quick Google of the carbon cost of the metaverse reveals virtual is by no means green)? Could we learn more about creating places in the metaverse? Could these worlds that are being developed be a test bed for more social cohesion, for building back better? It is a fascinating development and one that real estate cannot ignore (click here if you want the real expert insight). But before we dive head first into a world of avatars, blocks and code, let’s remember the value of the tangible and the huge amount of work this sector still has to do sustaining the real world.   To send feedback, e-mail samantha.mcclary@eg.co.uk or tweet @samanthamcclary or @EGPropertyNews