This past Friday I attended the MIT Center for Real Estate Global Forum for 2012, at the Federal Reserve Bank of Boston. The full-day event was dense with information and broad in perspectives. I caught up with an old friend from high school (Donna Dibona) who attended the CRE for her master’s in 2008. I met a lot of great people and learned a lot.
One of the first presentations was on the topic of High Performance Workspaces, one of my favorites. Kevin Sheehan from Boston Properties presented: there is a revolution in the workplace. Custom is in, cubicle is out. Traditional office space is like a frog in a slowly boiling pot – hopefully it will wake up and jump out before it’s too late. Kevin referenced Jim Lauman at Google, who has explored the intersection between people, space and technology. Workplaces are all about collaboration now. Rather than an assembly line for production, offices are for heuristic activity and creativity.
He described how people cost 10x the cost of space, so space has to be leveraged to support the brand and culture, to foster collaboration, to engage with sustainability and to attract and retain top talent. There’s a war for talent going on – and young people today care most about salary but #2 is their work environment. The office is not a commodity, and it’s not being replaced by telecommuting. He recommended we read a book called “Honest Signals” by Sandy Pentland, advocating for face to face collaboration, and also “Where Good Ideas Come From” by Steven Johnson. Innovation for businesses happens in team settings, in offices.
A lot of his presentation was going over the Google remodeling that has happened at their space in Kendall Sq – opening up and connecting floorplates to enable the firm to grow in-situ, and to foster communications and spark conversations which is at the heart of Google’s business strategy. Kevin was confident that the amenities of restaurants and other services in the building and others like it (i.e. Atlantic Wharf) will result in best tenants and highest values for their buildings. I really appreciated his presentation, even if it diminished teleworking, which I reckon is a major force. I agree that people still need to work together, and I’m enjoying finding the ways to enable owners to make their space the best for their future tenants (via BlastOffice).
There were a lot of other presentations – modular construction practices, where Boston fits in the global real estate market, and an academic comparison of monocentric to policentric cities by professor Bill Wharton. I caught up with Donna and other alumns during the lunch break. It was great to hear about their many projects and to talk with them about the future of office space. I will be following up with a couple of them on how to solve the logistics issues I’ve encountered. What a great group! (Donna, Daniel, Kristy and Rimi)
The afternoon held more great components of the Forum. MIT collected a group of luminaries from across the globe – including Turkey, Mexico and China – to present on what the new global investor is looking for. I am sure there is a better synopsis somewhere else [nothing seems to be posted yet, but let me know if you have seen anything, thanks]. Great perspectives on those countries. I enjoyed talking with Emre Camlibel afterwards, learning about the amazing growth going on in Turkey. There are 40 high-rise office buildings in the whole country, an $800M economy! Qian Wang from China had great stories as well, about third-tier cities with almost 10M people…
After a “Lightning Round” of presentations about legal cases that are moving through the courts and will affect real estate development, the day closed with a series of finalists in a case competition. Both the legal cases and the development cases were very illuminating to me. The development scenarios were to develop Pier 38 and the adjacent area just south of the San Francisco Giants stadium in the “Mission Bay” area of that city. Student teams had put together a plan for the 20+ acre site since Monday, and had gone through and elimination round earlier in the day. Some of the judges were actual members of the Giants’ board. The final presentations were polished and the projects diverse. All were mixed-use, all had to handle game-day parking, all had to provide 5 acres of new parkland for the city, and each had gone in different directions. I caught up with the winners, from Toronto, at the end-of-day cocktail reception. They had really put together a great project with a good sense of the market demand for their offering. I was psyched for them, and hope to get involved in a similar case presentation sometime in the near future. The reception was at the top of the Federal Reserve with great views out across the city in both directions. The best surprise of the day was to realize that MIT’s mascot is a beaver (it was on the prize for the case competition), same as my alma mater, London School of Economics. Great minds think alike!