Asia’s real estate leaders can expect an “enormous explosion” in the use of artificial intelligence in the next few years, says Link REIT’s Chair & Independent Non-Executive Director, Nicholas Allen.
Nick discussed the AI juggernaut, among other property technology trends, with Yardi’s Senior Regional Director Bernie Devine during the latest instalment of Yardi Proptech Insights. McKinsey hailed 2023 as “AI’s breakout year” and predicted that generative AI could add s US$4.4 trillion to the global economy each year. Goldman Sachs has estimated that 300 million full-time jobs could be transformed.
And yet, 24% of Asian real estate leaders who responded to a recent Yardi-Mingtiandi survey admitted they were yet to apply AI in their business. What’s more, 27% didn’t even know what their next step to do so might be.
Nick told Yardi’s audience that Link already has a “reasonably sophisticated” view of AI and has earmarked 54 properties for AI-enabled energy efficiency and optimisation. The “50,000 plus” car parks across Link’s portfolio are also in the board’s line of sight.
When it listed in 2005, Link REIT was Hong Kong’s first real estate investment trust; today it is Asia’s largest REIT in terms of market capitalisation. Over the last 17 years, Link has amassed a portfolio of 130 retail and commercial assets in Hong Kong as well as 24 assets in Mainland China, Australia, Singapore and the UK. Together, these assets cover a massive 11,952 commercial leases.
Link’s assets aren’t just buildings. They are extended living rooms that are central to community and culture. “Our community and catchment areas are people living a few hours away, a few yards away, that come through our malls to get on the MTR system to go to work,” Nick commented.
Link has a “strong” focus on net zero and has reduced the carbon intensity of its portfolio by 13.8% since 2018. It is making steady progress towards its 2035 net zero targets. “We have our pathway and [our] science-based targets [will be] verified over the next two years,” Nick said. Solar has been rolled out to around 35 assets with more to come; an electric vehicle roadmap outlines a plan for 3,000 charging points across 15 districts by 2024.
Meanwhile, the use cases AI in predictive analytics, energy management systems, fault detection, demand response and more continues to grow. Yardi is optimising its data and processes to help customers take a big, bold step into the world of AI, Bernie noted. The volume of data being produced by buildings is “staggering”, and one of Yardi’s advantages is that its scale brings broader data and “better answers”. Yardi’s scale means AI can learn from six million work orders – which Yardi software produces in just one year – rather than six thousand.
Asia’s real estate sector has plenty of issues to iron out as it adopts AI at speed, but one perennial obstacle to technology remains unchanged. The Yardi-Mingtiandi survey, the results of which will be released in November, found 42% of real estate leaders see resistance from users as the biggest barrier to change.
What can leaders do to break down the barriers and drive the adoption of advanced technology?
Link is focused on empowering and educating its people, Nick said, because advances in technology are “moving very very quickly”.
Upskill people to embrace uncertainty, Bernie suggested. “Any organisation that can tell you they have a roadmap for AI doesn’t, because there isn’t one. It is changing so fast you can’t have a roadmap. You just have to be agile.”
Watch the latest episode of the Yardi Proptech Insights program