Advisory Topic: Corp Real Estate Vol. 12 No. 1
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Technology's Impact On How We Use Commercial Space

Author: Jim Young, CEO, Realcomm

The Information (Internet) Age and the Potential Effects On the Commercial Real Estate Market - January 15, 1992

20 years ago this week I published an article that started my real estate technology career. The actual document began as an outline I created while on a train in Europe, on an extended vacation between careers. I had spent about 10 years in the technology sector starting in the early 80s where I worked for great visionaries like An Wang, Founder of Wang Laboratories.

I had decided it was time to make a significant change, so in 1989 I made the decision to leave the technology industry and make a career change to the real estate industry. I had always been interested in real estate, development and urban planning and figured I could take what I had learned in the technology industry and apply it to the real estate business.

Since this was going to be such a major change, I decided to do something I had never done before; take a month long vacation in Europe. I had heard about sabbaticals and really wanted an opportunity to clear the hard drive before I made the move. My hunch was right and I enjoyed 30+ days of no schedule, agenda, appointments or phone calls.

The time off seemed to be working as my mind was freed to really explore the new industry I was about to enter. During a train ride in Austria while gazing out the window at the incredible landscape, I had a sudden "information rush." Nothing like this had ever happened before; the thoughts and ideas kept coming faster and faster. I asked my girlfriend (now wife) for a piece of paper and a pencil and began to frantically write down my ideas. This scribbling of notes was the beginning of my "Info Age" article.

It took another couple of years to totally construct my thoughts and clean up the document and I officially published it on January 15, 1992. The main idea was centered on the concept that we built commercial real estate to facilitate the commerce of the day. In the agrarian age we built barns, industrial age we built factories and for the last 70-100 years we have been building real estate to accommodate a pre-information (Internet) age for commerce. Office, industrial, retail, mixed use and other forms of real estate were built to accommodate how we were living.

The second premise was to imagine what would happen when technology advanced to the next logical step (think iPads, digital cameras, the cloud) and affected the real estate that was used to facilitate an analog world (think Barnes & Noble, Blockbuster and Egghead Software, as well as banks, offices and other forms of real estate).

I remember the reactions I got in the early 1990s when I suggested to real estate professionals that their 10 year Blockbuster leases might not make it. While I was clearly off on my timing, it is interesting to look back 20 years and see just how many of the predictions were spot on. From Eastman Kodak's manufacturing space that processed film to the retail shelves at Blockbuster, as well as the industrial space where the books, magazines and newspapers were printed, it has been quite a journey to watch the headlines as these once mainstream companies and their products became obsolete, eliminating the functional need for the space, just as we had done years earlier with barns and factories.

It's now been 20 years since I put my predictions on paper during that train ride through Austria and it has certainly been an interesting journey for me. I hope you take the time to read this short article. Now that the headlines are substantiating what were once considered wild claims, the ideas and concepts may provide some insight into what our commercial, corporate and institutional real estate market might look like 20 years from now.

VIEW the Info Age Article:

RECENT NEWS: Kodak prepares for Chapter 11 filing - January 5, 2012

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