Demographic shifts and consumer behaviour
Our world is dynamic and changing - and so are its inhabitants. Generations X, Y and Z have their own behavioural characteristics. Generation Y, or Millennials, are digital natives and technology has become part of their daily lives. Generation Z was born in the era of internet, smartphones and tablets. Their education, home and social lives are hugely impacted by digitalisation. Their lifestyle is influenced by social media and they want everything immediately - an attitude encouraged by the digital world in which they are immersed. Next on this list of ‘Generations’ is Generation Alpha - and the world is yet to experience their behaviours. They will of course be ahead of Generation Z in terms of digitalisation and behave very differently accordingly. The question businesses need to ask themselves is, ‘How ready is the real estate industry in the GCC to face these challenging – but very interesting – new consumer behaviours?’
Technological integration and Smart Cities
These generational behaviours are the key drivers for any industry and it’s vital that those involved understand the impact and demands of its consumer base. First and foremost, the real estate industry is facing strong demand for smart city development projects, which requires vast technology integration in order to deliver projects with smart housing, interactive offices and high-tech buildings. It is very much the norm these days that modern houses with unconventional technology allow their inhabitants to manage all their appliances - heating, lighting, security - with their smart gadgets. In addition, the IoT, AI and blockchain are reinventing the real estate business. Smart cities are the next era of metropolitan living, where digitalisation transforms living standards with powered property management systems. These projects have - and will continue to - further enhance and transform customer experience.
But consumer behaviours and technology are not the only challenges for the real estate industry in the GCC.
Environment and sustainability
We of course take into account the technological advancements in our world and the impact of the behaviours of its inhabitants on the real estate industry, but it is also vital to consider the impact of environmental sustainability on this industry. Sustainable development is vital in ensuring a balance between growth, modernisation and environmental safety. Green buildings, energy efficiency, renewable energy, water conservation, sustainable materials, site selection and urban greenery are just a few of the many elements that players in this industry need to consider when developing environmentally sustainable projects. Many environmental sustainability projects are already subject to government incentives, which can help offset the additional costs associated with green building technologies and practices. This welcome support enables developers to invest in green community projects without too much of a hit on their return on investment (ROI). Furthermore, green community projects enhance the self-sufficiency of development projects through a variety of sustainable techniques.
So, as a real estate industry player in GCC, how can businesses ensure that they are correctly oriented to serve the interests of their key stakeholders?
Industry adjustments and future direction
Discussions during business meetings or around the coffee table are often centred on the transformation of the real estate industry and the impact of user demand. The challenge during these conversations, however, is to ensure that the participants understand that there is requirement to adjust the traditional methods when developing projects. Engaging the right technical expertise, ensuring access to information on cutting-edge sustainable technologies and understanding consumer demand are non-negotiables. Together with the relevant training and education, these are just part of many other initiatives in the development of smart city and environmentally sustainable projects.
Conclusion
There is no doubt that the real estate industry in the GCC region is at a developmental crossroads. In addition to demographic shifts and changes in consumer behaviour, technological advancements need to be embraced and attention paid to environmental demands. The region’s industry leaders must embrace these trends to remain relevant and competitive as the growth of the industry depends on integrating smart technologies, understanding generational behaviours and committing to sustainable practices.
BDO Real Estate & Construction teams (REC) can support the region’s businesses in successfully integrating sustainable practices into their projects and business goals. Aiming to contribute to the environmentally sustainable growth of the industry in our region, we offer assessments, the identification of improvement opportunities, benchmarking and comparison services, together with risk management, monitoring and verification and stakeholder communication. Please feel free to reach out to the REC expert in your local BDO firm if you have any queries.
Hizbullah Khan
Partner - Assurance Services – BDO UAE
Our world is dynamic and changing - and so are its inhabitants. Generations X, Y and Z have their own behavioural characteristics. Generation Y, or Millennials, are digital natives and technology has become part of their daily lives. Generation Z was born in the era of internet, smartphones and tablets. Their education, home and social lives are hugely impacted by digitalisation. Their lifestyle is influenced by social media and they want everything immediately - an attitude encouraged by the digital world in which they are immersed. Next on this list of ‘Generations’ is Generation Alpha - and the world is yet to experience their behaviours. They will of course be ahead of Generation Z in terms of digitalisation and behave very differently accordingly. The question businesses need to ask themselves is, ‘How ready is the real estate industry in the GCC to face these challenging – but very interesting – new consumer behaviours?’
Technological integration and Smart Cities
These generational behaviours are the key drivers for any industry and it’s vital that those involved understand the impact and demands of its consumer base. First and foremost, the real estate industry is facing strong demand for smart city development projects, which requires vast technology integration in order to deliver projects with smart housing, interactive offices and high-tech buildings. It is very much the norm these days that modern houses with unconventional technology allow their inhabitants to manage all their appliances - heating, lighting, security - with their smart gadgets. In addition, the IoT, AI and blockchain are reinventing the real estate business. Smart cities are the next era of metropolitan living, where digitalisation transforms living standards with powered property management systems. These projects have - and will continue to - further enhance and transform customer experience.
But consumer behaviours and technology are not the only challenges for the real estate industry in the GCC.
Environment and sustainability
We of course take into account the technological advancements in our world and the impact of the behaviours of its inhabitants on the real estate industry, but it is also vital to consider the impact of environmental sustainability on this industry. Sustainable development is vital in ensuring a balance between growth, modernisation and environmental safety. Green buildings, energy efficiency, renewable energy, water conservation, sustainable materials, site selection and urban greenery are just a few of the many elements that players in this industry need to consider when developing environmentally sustainable projects. Many environmental sustainability projects are already subject to government incentives, which can help offset the additional costs associated with green building technologies and practices. This welcome support enables developers to invest in green community projects without too much of a hit on their return on investment (ROI). Furthermore, green community projects enhance the self-sufficiency of development projects through a variety of sustainable techniques.
So, as a real estate industry player in GCC, how can businesses ensure that they are correctly oriented to serve the interests of their key stakeholders?
Industry adjustments and future direction
Discussions during business meetings or around the coffee table are often centred on the transformation of the real estate industry and the impact of user demand. The challenge during these conversations, however, is to ensure that the participants understand that there is requirement to adjust the traditional methods when developing projects. Engaging the right technical expertise, ensuring access to information on cutting-edge sustainable technologies and understanding consumer demand are non-negotiables. Together with the relevant training and education, these are just part of many other initiatives in the development of smart city and environmentally sustainable projects.
Conclusion
There is no doubt that the real estate industry in the GCC region is at a developmental crossroads. In addition to demographic shifts and changes in consumer behaviour, technological advancements need to be embraced and attention paid to environmental demands. The region’s industry leaders must embrace these trends to remain relevant and competitive as the growth of the industry depends on integrating smart technologies, understanding generational behaviours and committing to sustainable practices.
BDO Real Estate & Construction teams (REC) can support the region’s businesses in successfully integrating sustainable practices into their projects and business goals. Aiming to contribute to the environmentally sustainable growth of the industry in our region, we offer assessments, the identification of improvement opportunities, benchmarking and comparison services, together with risk management, monitoring and verification and stakeholder communication. Please feel free to reach out to the REC expert in your local BDO firm if you have any queries.
Hizbullah Khan
Partner - Assurance Services – BDO UAE