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Blockchain technology is set to transform commercial real estate, with wide ranging applications, revealed latest research from Colliers International.
Blockchain, for instance, could provide a secure platform for all parties to verify each other’s identity, as well as the data on and history of the real estate asset being leased or acquired.
This comes as the list of parties involved in real estate deals could extend well beyond the owner and buyer or occupier to banks, brokers, law firms, utility operators and governments.
“Blockchain could be used to build ‘smart’ contracts in which terms and related transactions are automatically, and near-instantly, recorded and immutable,” said Michael Bowens, Colliers International’s executive director for regional tenant representation Asia.
It could also help boost the security and transparency of real estate markets, especially those where data availability or quality is at times lacking as seen through much of emerging Asia.
“Moving land registries onto the blockchain promises to create automatically updated, tamper-proof records, ultimately enhancing the clarity and security of land and property ownership,” noted Bowens.
Coupled with artificial intelligence and other technological trends, blockchain could lead to lower staff requirements in back and middle offices as well as reductions in office sizes, or at least greater efficiency in office use.
It could also accelerate a decentralisation process within the financial sector while increasing demand for flexible workspace.
“A definitive industry shift towards smaller, remotely connected or flexibly deployed teams could encourage migration to non-CBD locations and the adoption of flexible workspace models, with clear consequences for markets where financial firms have a heavy presence,” explained Colliers International Asia research head Andrew Haskins.
Colliers, however, noted that regulation and fear of job redundancies may discourage some segments of the market to adopt blockchain-based solutions.
Romesh Navaratnarajah, Senior Editor at PropertyGuru, edited this story. To contact him about this or other stories, email romesh@propertyguru.com.sg
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