Number 9: #SpaceasaService loves Generative AI: The Pro-gressive Company Nexus

‘Companies at the forefront of adopting Space as a Service concepts are often the same ones embracing Generative AI in their workflows.

This creates a synergy between physical and digital transformation efforts, marking these companies as ideal clients for innovative real estate solutions and advanced AI implementations.’

An underlying characteristic of all the themes we have looked at in this series is a progressive mindset. One that is doing everything tostifle those looking to tax the future to protect the fast. As the great American poet, Robert Frost, wrote ‘The only way out is through’ and in difficult times likes now, where we are morphing from the computer age to the AI age, this is apposite. You have to embrace the future in order to shape it.

And this mindset is shared by those in real estate embracing #SpaceasaService, and those in technology embracing Generative AI. Both of these are fundamentally creative movements that are looking to enable humans and machines to work together to produce things neither could achieve on their own.

This similarity of mindset means, I think, that progressive companies in real estate and companies embracing Generative AI are natural bedfellows and should be each others best customers.

Let’s walk through where these two exemplars of the current zeitgeist overlap:

• Predictive Space Management, where AI enables us to forecast occupancy and usage patterns.
• Personalised Environments where we create spaces that adapt to individual preferences automatically.
• AI-Driven Design where Generative tools allow us to create optimal layouts and aesthetics.
• Automated Facility Optimisation where AI manages and continually optimises energy, maintenance, and resources throughout a building.
• Cognitive Buildings that are structures that learn and evolve based on inhabitant behaviours.
• AI Concierge Services are advanced AI assistants that manage all aspects of space use.
• Wellness-Centric Design uses AI to optimise spaces for human health and wellbeing.
• Biophilic Integration utilises AI to seamlessly incorporate nature and natural elements into built environments.

And so on. #SpaceasaService aims to create the physical, social and emotional environments that enable people to be as successful as they are capable of being, and to make people, happy, healthy and productive. Generative AI (as well as non generative) provides many tools that contribute to making this possible. These are very much high tech and high touch places. Achieving the desired human outcome actually requires the successful synthesis of data, technology and advanced human skills. Hard and soft components are required. This is a quantitative and qualitative game.

There are other similarities in culture between #SaceasaService and Generative AI companies.

• Dual Innovation meaning that companies at the forefront of AI adoption are also at the forefront of business model and operating model innovation, so the standard office is unlikely to be human-centric enough for them.
• Automated + Augmented - both types of company favour balancing task automation with AI-augmented human roles.
• Flexible Spaces, Flexible Tech - there appears to be a correlation between adaptable workspaces and adaptable tech stacks. If you’re in favour of one you’ll likely be in favour of the other.
• Human-Centric Approach - prioritising employee experience in both the physical and digital realms. Talent density is essential in AI companies, so looking after your talent really matters.
• Data-Driven Decisions - using AI insights to optimise both space utilisation and business processes is a default setting in these types of companies.
• Continuous Adaptation - another default setting are cultures of ongoing learning and evolution in both space and tech use.
• Holistic Productivity - viewing workspace and AI tools as integrated productivity enhancers. One provides a flywheel for the other.
• Future-Ready Mindset - and finally management teams have to be prepared for rapid changes in both real estate and technology landscapes, and thus have to have an extremely well attuned future-ready mindset.

Taking all of this together I hope the point is clear that progressive real estate thinkers need to seek out progressive technology companies (or companies aggressively using technology) as they will be the most likely to buy into new ways of delivering value. Everything about these ten themes will NOT be across the board. Companies pursuing them will be pre selecting who their target market needs to be. Looking at the innovation adoption bell curve we’re after the early adopters and the early majority. That’s where the differentiation will be, as well as the premium market. After all there is a strong argument to be made that 30-40% of existing office real estate is already obsolete, or heading there fast. I don’t think we are far off the following scenario;

1. The top 15-20% of the market will be designed for large multi-national companies, that have the in-house scale and substance to create exceptional workplaces, in exceptional buildings, for their employees.
2. The next 40-45% of the market will operate #SpaceasaService - either by taking space in one of the growing breed of high quality flex operators, or by having one of these operators run their own buildings for them. CBRE buying Industrious suggests this is now a key plank of their thinking.
3. The remainder of the market either disappears (through shrinking down space requirements) or operates fully distributed. There is no future for low to medium quality commodity office space. It simply will not be needed.

This theme, number 9, is all about aligning yourself for the vanguard of this inevitability, which will likely play out over the next 5-10 years.

‍What do you think?

‍The future appears as much about human creativity as it is about algorithmic precision. Are we ready to embrace a world where our workspaces learn, adapt, and even anticipate our needs? What do you see as the most exciting opportunities—and the most daunting challenges—in melding advanced AI with the very fabric of our built environment? I’d love to hear your insights.