Can you please tell us about Union Investment?
As a German-based business, we have a long-standing presence in the real estate market, managing investments for institutional and private investors via a wide range of funds. We currently manage a worldwide portfolio of over 400 properties across multiple sectors, comprising around EUR 50 bn of assets under management.
What is your role in the company?
As Head of Digital Transformation, my role is twofold. Firstly, alongside the CEO, I am responsible for the overall strategy and development of the company, and secondly, I work with the COO to ensure the implementation of the strategy. The team I lead is comparable to a corporate management department, where the digitalisation of operations is integrated with all areas of the business including sustainability, process and control management, so all topics, trends and issues influencing the development of the business come across my desk.
So digitalisation is intrinsic to both the operational business and strategic development of the company?
Absolutely. We embraced digitalisation in 2016 when we realised the impact digital technologies were set to have on real estate, and our sector as whole was being slow to react compared to other industries.
Our approach to digitalisation is two-dimensional.
Primarily we focus on our internal processes and how we manage and analyse our systems data by transferring from a manual to automated process to gain more cost efficiencies. We then look at how we can best adapt this technology to create new business models and develop digital ecosystems in and around our buildings, putting the user at the centre. We then work in partnership with our tenants to develop the best, most attractive features and services to solve their problems and ensure they achieve maximum benefits from the building.
What are the most important issues or challenges for tenants which digital technology can help solve?
It varies, but I think there are three common themes, all of which have become more topical with the increasing trend of hybrid working and hot-desking in the post-COVID world.
Availability and cost of car parking, particularly in central locations, is an important topic, with the huge variety in levels of demand from busy periods to quieter times for both staff and external visitors.
This forms part of wider mobility concepts, such as how tenants and visitors move around locations, which is an increasingly significant issue. In turn, mobility is an important component of the second theme, which is sustainability – for example, how we integrate power-charging.
Thirdly, we focus on how to support the tenant and user by maximising the convenience factor. With integrated digitalised platforms, workplace management can be individualised and energy-efficient – for example, in heating, cooling or carbon dioxide concentrations.
For all three there are a number of processes to help, but ultimately users are able to access a mobile app via their smartphone which enables them to check availability, view options and make reservations in advance of coming to the office.
What impact has COVID-19 had on the pace of change and adaptation of digital technology?
The pandemic has certainly sped up the adoption of digitalisation as the ‘new normal’ and companies without a multichannel digital business model have struggled and are at a huge disadvantage. Those with platforms in place have been much better equipped to survive and thrive, are more connected and can cope with the new virtual, remote way of working as common practice.
I think the pandemic has accelerated change we would have seen by several years.
What are the barriers or challenges facing the widespread successful adoption of digital technology?
With so many partners throughout the real estate cycle, the industry is very fragmented. Therefore, it is vital for the industry collectively to have a mindset of cooperation, interaction and collaboration. Secondly, the industry sometimes does not have the courage or the vision to try new things and experiment. Other industries, such as IT, do this so much better, working on new, vibrant products with their customers. Finally, and most importantly, we have to learn to take people with us on the journey, think about their needs, allaying fears and inspiring confidence and understanding.
What are the main overall benefits digital technology is bringing to Union Investment?
While cost savings and the acceleration of innovative processes are helping us to operate faster and more efficiently, it is the overall increase in quality, and consistency of this quality, which digitalisation provides over manual processes.