Design

Joe Du Bey: The Experience Era - Sweeping Major Industries in the US

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Joe Du Bey, CEO of Eden helps navigate The Experience Era and how the nature of experiences are transforming industries across the US. This talk showcases how different demographics of people value experiences and how that value is fundamentally shifting the business of entire industries. With real estate taking center stage, Du Bey brings forth examples from industries such as fitness, music, retail, coffee, enterprise offices & more.


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Joe Du Bey, CEO, Eden

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VIDEO TRANSCRIPT:

Hey my name is Joe Du Bey and I'm going to talk today about the experience era and how it's affecting commercial real estate. So what is the experience era? The main thing to take away is that the world is changing. It went from before being where it was something that you know you served any one industry and maybe sold a specific product and service. Today we're all actually in the experience business to think about commercial real estate today versus what's going to happen. It's a largely offline world. And that's it's something that is focused on the space and less on the people and the experience of them.

And that's something that's about to dramatically change. So what is causing the experience era in one word millennials today. Millennials are the biggest cohort of any population. This is a really substantial shift. And this is something that is affecting the preferences of the workforce itself. And the reason why that's so is because millennials are different. They actually value experiences over products. And this is a critical thing to understand once this is grasped. It all starts to make sense.

But the majority of one else would rather spend money on an experience than a thing. They're wired differently even when it comes to work. The majority of millennials would take less money. If they're able to have a better experience at the office if they felt the experience reflected themselves. In contrast in case you don't think that's different. Only 9 percent of baby boomers would do the same. They are wired a bit differently and we need to adjust to their preferences. So what makes something fit the experience area we've discovered there are six hallmarks to this new time.

Specifically you can see involves enabling technology. It's at least made more efficient through technology. Any one of the major experiences that consumers in enterprises are going through in the experience area users are empowered they have voice they're able to customize their experience. This is critical. It shows up in amenities. It shows up in services inexperience error people care about community and they're building community around these experiences that were previously about a service or product. It's really the community that wrap around it. Things have meaning. It's not just about the coffee for instance it's about why it's ethical inexperience era quality matters a lot especially because these millennials are investing in the experience so it makes sense that their since they're shifting money to that they'll care more about the quality of it.

And the last thing is design inexperience error. You'll notice that if it starts to feel to you like more and more things look like the inside of an Apple store it's because more more things do look like the inside of an Apple store. Millennials care a lot about design and it's showing up everywhere. So let's talk about a few industries and how they've been transformed already in the US. There's the music scene if you remember from 20 years ago when you show up to a concert there were a few people playing music and that's what a concert was. Now when you go to a music event it's really much more about the experience. You walk in and it's a crowd of people who are seeking like minded folks.

It's immersive. There are lights there's artisanal food. Yes someone's playing music somewhere but that's not actually the primary thing. You might take away from being at a music event these days and is popping up across the US. Now let's talk about retail. When you used to go to a mattress store it was a roomful of bunch of mattresses. Now you go in and it's actually limited minority might be a mattress. We're walking into is a place that's beautifully designed full of narrative really speaks to millennials. When you used to walk to a gym it was a place full of heavy weights. Now it's if you walk just like Soul Cycle what Barry's Bootcamp.

It's a group of people who are building community. They might feel even you might send something almost religious around the dedication to this specific group. This room and it's beautifully designed. If you think about consumer coffee it's again something where you know it's the kind of thing where people use to go and literally just get coffee from a diner. Now it's a beautifully designed room. Starbucks even calls itself your third place. Recognizing that there is a different kind of feeling that comes in to a coffee shop today and now you can start to see it in commercial real estate just that just starting to.

And that's something because in the past it was really a place where you got work done. If you look at this market leaders Historical Office now with Google there's a climbing wall. They care about customization choice services and they know this is critical for them to actually hire the very best talent. And what is an overheated talent war. The thing to keep in mind is that 99 percent of commercial real estate is offline. This is just starting to happen. And over the next couple of years you'll feel this in a really big way. This beginning it's experience matters because in the first couple of years whenever there's a tectonic shift those who adapt early those are the ones who get to have outsized influence and kind of pain in the future whereas we fast forward or in five years.

The folks who haven't become the laggards they're the ones who threaten the actual performance of whatever their underlying asset is. How will this change commercial real estate. What tactically do you need to do to enter the experience era. Well specifically think about your building across a bunch different dimensions. A big primary one is how do you think about lease terms. It's something where in the future people want to have duration of lease that reflects their actual needs which isn't decreasingly two to 10 years and much more let's say nimble outside of that space controls today it's something where people have almost no control almost no voice that is changing rapidly through technology email to enter from from accessing the building itself to requesting services.

You can now actually have control over almost anything. Tenant feedback historically ignored with a landlord or building and you're really thinking of it places us as a space as opposed to thinking of the people inside of it as customers in the future and experience first building. It actually solicits feedback. It cares how its customers are doing outside of that the brand of the building itself. This is something that's critical in the past people might not even know really what kind of building they're in who the owner is who's managing it. The future is a much more white labeled experience where the building itself has a brand that people care about outside of that something that's really critical is what do you provide in terms of services.

In the past nothing going forward amenity rich people should be able to get any kind of service they want from food to any sort of wellness and like yoga or whatever they might want they need to be able to access through their building. And the final one community. Right now buildings are a missed opportunity everyone in it could feel something. It could build loyalty. Instead today it's mostly a box that has no connectivity the experience era has arrived and there's no turning back at this point.

Over the next couple of years everything will change. Commercial real estate and it will no longer be about the space it's providing an experience with space attached. Eden is ushering that in for all of the commercial key stakeholders from the occupiers and the companies to the landlords and the property managers and we're enabling you to provide an experience first building for your tenants

 


Michiel Hofman: Bloomframe - Designing For Human Intuition

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Michiel Hoffman is an architect by trade and the CEO of Bloomframe. His philosophy of architecture is based on human values, pushing the boundaries of how space can serve people.  


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Michiel Hofman, Partner, HofmanDujardin / Bloomframe

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VIDEO TRANSCRIPT:

Good morning everybody. My name is Michiel Hofman and am one of the architect Founders of HofmanDujardin, an architecture firm based in Amsterdam. Today I will speak about the two things. One is our design philosophy which is based on the human intuition and the second, we designed a product which is related to this philosophy which might be very interesting for New York.

This is our office. We're based in Amsterdam. We have approximately 40 architects and this is our design philosophy. It is called shaping intuition. So what we say when we create architecture, urban design, interior design it's always related to the intuitive values of human beings. We call it shaping intuition and what it’s based on actually four elements which are very relevant. If we think about architecture it is spaciousness, groundedness, expression and connection and actually each human being requires these elements. So if you work on urban planning architecture or interior design we say these elements are required. So spaciousness is about lightness, brightness and can you breathe in this space. Groundedness if you feel protected and do you feel safe in the environment. Expression is something what what is very attractive and what is triggering us. And the fourth element is the connection which is the relation between people the relation between spaces and the relation between inside and the outside. And what do we actually say while here you can see the elements based on the natural values but the sentiments you have of these values, the spaciousness when you're on top of the dunes. This is in the Netherlands. Groundedness if you're in the forest, you even have this also in Central Park. Expression these are the flower fields in the Netherlands the tulip fields and the right bottom is that connection, the total flow of space. And what we actually say is that human being requires a balance of these elements.

I don't know if you had this already in school once that if you look into were red dots and you look away you see a green dot. This means that your body creates complementary experiences and we say the same happens in architecture with these four elements so if you create one, you also create the other ones around it so people can be in balance in the space. And we have a quite a nice test. So please have a look at this picture of the Paris Eiffel Tower it's black and white. So if you have a look at this image more or less 10 to 15 seconds I can show you what's going to happen with your intuition. So if I go back to the black and white picture you see the coloring of the image which is quite astonishing because you're looking at the black and white picture. You're creating the opposite colours of what you see here. You see the green grass you see the blue sky. So when we say the same happens in architecture and there are also examples in nature for example. So if you would walk in the forest or in Central Park and it's dark you have the trees around you and people would take a break. What will they do, they will go to the open space. It's about the complimentary experiences of architecture and the opposite happens if you walk in the open fields and then you take a break. People will look for the groundedness and they will sit under a tree. So with this philosophy we create architecture and we design different things so this is more the introduction of the office.

So we do a housing project in Amsterdam with a swimming pool crossing over. We built a residential tower in Beirut which was reported that the CTBUH Awards 2016. This is a funerary centre in Netherlands. This is a proposal for the ING Bank in the Netherlands in Amsterdam. And this is a distribution center in Rotterdam. The booking headquarter, we collaborate with you in studio and this design is in the center of Amsterdam. Seventy five thousand square metre. And we also do interior design. This is for a booking and this is for the American company Indeed. Also in the Netherlands.

So this is these are the designs we're doing with this same philosophy shaping intuition and what we show you now is the bloom frame design. It comes from the same design philosophy but it's a product which can be integrated in the facades. That's actually what brought us here to New York. And what we see is that there are many apartments in Amsterdam also in New York which are very much closed off. There are no relations from inside to outside. So we investigated what can we do? What can windows contributes to the wellbeing in apartments in small apartments. And here you can see pito people sitting inside the windows actually looking for outdoor space the light to breathe. There's an example from Amsterdam so people would like to go outside. So we started sketching what are the possibilities if we can transform the façade and that the facade window becomes a balcony. First we started with the Lego models to say okay how can we transform this façade, how can the lower panel can open up and become a balcony? We made scale models and actually led to this prototype.

So you have a lower window and you have an upper window and within 55 seconds it can open up automatically and become a balcony. So this gives huge opportunities to the real estate market because suddenly you can add three square meter of your facade to the surface of your apartment and we can create responsive architecture transforming facades. Here are the sizes, so the deepness is one meter ten which is three point six foot large and this is ten foot. And here are the examples. So we project that the first project in New York evidently. So you have to close the facade. You can open it up. And which can become this kind of architecture. From the inside, you have this view. The lower panel then becomes a balcony and you can step outside, breathe, have additional light to the apartment. And we made a movie. So the product has been developed completely and. It's now certified as a window certified machine and it's certified as a balcony in Europe.

The Bloomframe has produced by Kawneer France based in Montpellier, France. It's actually an iconic company, an American company, and what I now want to show you is actually the first project where we launched the product this is in Amsterdam. It's a housing project and we have some images of the wait has been installed. These were the visualizations.

So it's at the canal, has a very beautiful view. This is the way it opens up.

And so these were this was the launch of the first product they installed and it was quite amazing. It's very simple. It arrives in a box at the building site. You just lift it in the correct position. You pull it towards the facade and you fix it, and that takes actually say two hours and it's done. This is the owner of the apartment and actually the scaffolding is now out. The it has been completely produced. And this is the site with the French engineer also part of the team. This is the view on the canal.

So it is the first one they installed and they actually were quite ready now to come to New York and say we see a huge opportunity in the city to transform the facades, create responsive architecture, and to make micro apartments slightly bigger to create outdoor air space. Thank you very much.

Angie Lee: What Working Outside Teaches Us About Working Inside

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Angie Lee, Head of Brand and Marketing for Industrious presents their outdoor co-working project with L.L. Bean and how owners and developers of office space need to embrace new lessons on creating an amazing day at work. 


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Angie Lee, Head of Brand & Marketing, Industrious

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VIDEO TRANSCRIPT:

Hi my name is Angie Lee and I'm the Head of Branding and Marketing for Industrious but I'm here to talk to you a little bit about a collaboration we did with L.L. Bean. It was an exciting opportunity for us to really understand what working outside teaches us about working inside.

We are committed to delivering an amazing day at work where thousands of members across our 50 locations across the country and over the past five years. Since we were founded we've helped over 2000 companies actually really grow and scale their businesses. And what makes it really interesting what really helped us stand apart is the fact that we can look across all of these 2000 companies to really distill what delivers on an amazing day at work and really the secret sauce boils down to two things that our ability to marry gorgeous high quality spaces that are designed really to drive productivity not just by creating beautiful spaces but about spaces that drive productivity and the other is to marry that where the workplace experience it really makes people proud and excited to come to work.

So we're talking about scale in terms of office space but then individualising the workplace experience and we're incredibly proud of what we've done. We have amazing space. This is actually our space in Chicago Fulton Market and of course we have our Center City location out in L.A. And what we've done is an amazing job of flooding all of our spaces with so much light and really filling it with green to really bring the outside in because we've all read the same research that having a lot of sunlight, having a lot of greenery can actually increase productivity in the workplace. But really at the end of the day what all of our 50 locations share is the fact that they're inside office buildings. So as much as we want to bring all of this outside in, we're still inside. And so when L.L. Bean came to us and said you know, what would it look like if we were to redefine what an office looks like when you actually have no walls? We really jumped at this opportunity ask ourselves if we're really challenging ourselves to deliver an amazing day at work. What can we learn from working outside that can actually influence the way we design spaces inside? So thus was the L.L. Bean be an outsider campaign.

So this past summer what we did is we built these amazing outdoor pods these pods were designed using some basic principles around the cost of the building itself but then what we did was peppered in the principles that really drive productivity and effectiveness in an Industrious space. And then we took this pod on the road. So first we started out in New York City Madison Square Park typical tenant doing a typical conference call except he's doing and stationary bike. Right. And you see a bunch of people on the corner of here who are kind of sitting around milling around outside. We went to Boston, we went to Philadelphia, and we went to Madison Wisconsin.

So in the course of taking this thing on the road four locations, three to four days in each location we spoke to over 15 hundred people who showed up to really take advantage of this opportunity to work outside. We learned some really interesting things that really reinforce some of the principles we knew already deliver an amazing day at work but also then helped us translate what working outside could tell us about creating productive workplaces inside.

So because these talks always end up with three takeaways I’m going to walk you through three of those ideas. So first and foremost working outdoors really drives productivity indoors. Now to some of you guys this may be a little bit counterintuitive because when you think about going outside when you're at work you think of it as a break from productivity. I'm going to take a walk to clear my head. I'm going to get away from my desk, you take a walk when you go out for lunch. Those are the moments in which we're thinking about that as being a break. But let's take a step back and ask ourselves what defines a modern workplace today? What's fundamentally changed the modern workplace from say a factory in the eighteen hundreds. Is the idea that we don't believe that individuals are cogs in a machine but that our role is to really design workplaces that bring out the best in individuals and bringing out the best in individuals means you have to offer different productivity based types throughout the day.

So think about your day, you start the morning you're a little tired you're getting kind of settled in, you might go into BuzzFeed you're sitting at your desk right. You go to get coffee to kind of stand up walk around and you go to the kitchen and all of a sudden you're interacting with your colleagues. You then have to go to a conference room and so on and so what you see is these spaces can actually either contribute to your productivity or they can actually in some cases zap your productivity. So if you take an average person's energy levels throughout the day you might see some patterns so here's an anonymized individual over a five day period and what you see is every morning they would sit down on their desk and you would see that they're not really a morning person. They start out on their energy levels starts to climb and then eventually they go through lunch and then they end up going to a conference room in the conference room either zap's their energy because meetings zap and diverts energy or because it's just later in the day your sugar levels are dropping or increasing. You are getting sleepy and then you go back to your desk. And so the idea is that if you actually design a space for humans you're designing them not to force humans into the spaces that they're in but to give as many opportunities for individuals to kind of work in those spaces.

Now what happens if we start to treat the outdoors not as a novelty as this crazy idea that we're encouraging people to work outside but we simply treat it as another productivity space time. All of a sudden you're like oh I'm going to have my conference meeting I'm going to do this I'm going to have a meeting outside. You go to S.F. people in S.F. are notorious for their walking meetings and that's kind of the same thing, if you're already having a one-on-one with someone, why not go outside get a little bit that the energy in and get the endorphins running. But if you start to think of it as simply another productivity space type and not as a novelty, then you start to think of it as well, what could the impact be? So you take that same person and you stick them inside for a little bit and all of a sudden you start to see spikes in energy that actually exist once they return back indoors.

Now all of you guys know this you take a walk at lunch and you come back feeling refreshed. How amazing does it feel? It feels like it can give you the energy to get through the rest of the day. But that brings it to the second principle is that simply being outdoors is not enough. Delivering an amazing day at work, what we have found across all of our members is that you really give folks the energy or the environment to feel truly productive. So even just take a moment to think about what makes an amazing good day for you, it might be that you felt proud about the accomplishments that you achieved or that you felt incredibly productive and you got a lot of things done. If you're a checklist person, you are checking things off.

Let's have some honest talk.

Landlords a while back. You guys come onto the idea that being outdoors is a really great idea. And so you build these things right. And this all of a sudden was your outdoor space. Hard surfaces, completely rigid. I mean you spend two minutes eating a bad pizza out there and you're ready to go back inside. So landlords are putting these up outside these pavilions and then they said well no one uses them. It's not a good use of my time or energy. So therefore this willy nilly stuff about creating outdoor workspaces is just a fad. But what we found working with L.L. Bean and creating this space is that in the same things that you need indoors you need outdoors and you begin to make those outside spaces as productive. So if you look at the way that we've designed these spaces you have a mix of task seating and you have soft seating.

So are you being heads down and working on that memo. Oh you're boss or are you having a conversation to further further the relationship you have with a colleague. Are you. Do you have a convening space where you and your team can stand around Jim white board where you can actually collaborate and kind of be on the same page and putting things up on a screen. Is there fast reliable Wi-Fi. I mean anyone who's been stuck in an airport with no Wi-Fi knows that without Wi-Fi in this modern age it's a little hard to be productive and most specifically is just screen friendly shade. I mean if you think about using a laptop outside the one thing that gets in the way is glare and if you have an old school I mean this compared to this is obviously a completely different experience.

And so what this tells us is that yes people want to be outside but in order to be outside you actually need to have a space that's designed for productivity outside. This brings us to our third principle which reinforces what many of us already know is that outdoor amenities can create an outsize workplace experience. Now in the course of going on the road with L.L. Bean we had 1500 people show up and the response was overwhelming. Teams show up to hold their weekly check ins outside. We had people coming up to us saying you know I feel so refresh I can go back and you know kind of really work.

But what was really interesting is a lot of the team members the individual that came to us had smaller offices they came from smaller companies and they were so excited to be have a novel experience but to be able to leave their smaller offices or come outside. And so when you zoom out a bit and you take our installation in Philadelphia which is in the middle of the park what you see all around it are big office buildings right. And so imagine if you were a landlord and you have large office buildings around it it's just a very small leap forward to think of it as a campus right. It's really the difference when you want to brag about having a campus is about activating the outdoor spaces and the common areas.

And what we're seeing more and more is more landlords are recognizing that by partnering by using your outerspace as an act of being a common areas you can actually optimize the tenant experience but also increase revenue. Right here you have a rendering of the partnership that we set industrious is working with Blackstone Q in order to reposition the Howard Hughes campus out in L.A. And essentially what that is is it is a reinvention of what the modern campus looks like.

And what we're doing is we're building up entire outdoor spaces you see over here as we're moving some of the walls completely and putting glass doors or bringing the outside in. We're creating all these areas. Everything is going to be a Wi-Fi optimize everything has to be designed for a truly mobile workplace. Now L.A. is the perfect place for this where you have I mean sunshine all the time. And so when we designed is really a campus that can reflect that coastal lifestyle. But then also just use all of the available real estate to create a truly modern workplace campus.

So what does that look like so you notice here you have convening spaces here like we talked about you have taxiing back here with tables and chairs you have open places where people can walk and talk. There is a lot of variety of spaces so they even within the outdoor space were bringing those same principles into creating a modern workplace experience.

So if we look at the outdoor areas you can also see that the the opportunities are to activate the indoor areas as well. But again removing some of the doors and designing experiences that bring the outside in means that we get the best of both worlds you have climate control here 5 all those details that enable folks to be productive throughout and so on reflection if we look at what we learned going through what many people look at perhaps as a novel stunt that we did with L.L. Bean what you really can take away is that there are many principles that really define how working outdoors can help define what happens indoors and if you go back to the ultimate question of what delivers on an amazing day at work.

Well we would argue, that an office with no walls is actually looks like just an amazing day at work.

Laura Patel: Building for the 21st Century

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We’ve been building in the same ways since 1916, and they’re all expensive. Laura Patel, Global Head of Partnerships for DIRTT takes us through the evolution of construction methodologies and how technology is able to solve for time and cost efficiency.  


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Laura Patel, Director of Global Partnerships, DIRTT

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VIDEO TRANSCRIPT:

My name is Laura Patel and I am one of your local DIRTTbags. I work for DIRTT environmental solutions and this morning we're going to talk to you about construction for the 21st century and why we need digital construction.

I gave a talk last week at the University of Buffalo, they asked me to come up and do a TED talk for some of the real estate community and their students. And in preparing for that TED talk, some of my research brought me to this postcard which is a postcard from 1890. So let that sink in. This is 126 years ago and in this postcard you can see that they predicted that by the year 2000, this is in 1890, we would have architects sitting in a fun little box somewhere far far away pushing buttons and through a series of mechanical levers and pulleys and robots, we would be building onsite, using no human beings. And at first I thought this is crazy. This is mind blowing to me that this is what they thought we would be doing in 126 years. And yet as I started to study this more, I realized that they actually got it half right. Because by the year 2000 we had started to make huge advances on the design side.

We went from hundreds and hundreds of years of paper drawings to CAD in the 1970s through the 1990s and this introduced some process and some standardization to the design industry, whereas two drawing sets may have been dramatically different for the last couple of hundred years before that. Then in the 90s we started to introduce different BIM technologies and this allowed for on the fly problem solving by smaller groups of teams, whereas making a building like this would have required dozens of people in the past to try and collaborate and figure out how to actually get this built. Then more recently, moving into the early 2000s up until today, we've obviously seen this onsurge of different design technologies that now allow us to actually visualize the space before it's even built. Yet, this is our graph for technological adoption in design.

So a pretty steep curve and only getting steeper. If we contrast that with construction though it looks like this. This is a study by McKinsey and Company and you can see green is high adoption of technology red is low adoption of technology and for this study of McKinsey and Company polled 23 different industry sectors and if you scroll all the way to the bottom just above agriculture and hunting you'll find construction. So construction innovates only more than agriculture and hunting in terms of our adoption of technology in the process. And this is going back again about twenty five years of this study.

I started to think about that and it's true if you look at any other industry, the automotive industry, electronics be that TVs, phones or even healthcare, we like to criticize healthcare but even healthcare has been disrupted multiple times over the last hundred years. Yet if you compare that with construction, we've actually been building the exact same way since about 1916. That was the last great innovation that's when drywall was invented everyone, 1916. Although design has come really far, we've gone from this to this. We're still building the same way which is resulting in what I like to call the Museum of fun things that happen in construction.

The reality is they are all expensive and some of the research that I came across suggests that in the United States and Great Britain for every dollar we spend on construction about 34 cents of that dollar goes towards repairing mistakes that happen on site or towards different costs that arise from schedule overruns related to again, mistakes, miscommunications or challenges throughout the process. And that might not seem like a big number but when you start to factor that into the overall construction that happens annually it actually works out to about 140 billion dollars in wasted money because we are again, not using construction in this process. So how can we use 21st century construction technologies to help bring us into this century and build better? Meet DIRTT.

Now I'm going to talk about how we're taking all of that sophisticated design intelligence and we're actually bringing that one step further into the construction process. So we do that using a really sophisticated pre-construction design technology and it's doing four really important things for us. The first is that it's actually connecting all of the different platforms in one software. So rather than having your architect who's then trying to communicate via paper to the subcontractors how to build the space, this is actually automating between a 3-D view and a 2D view, all of our elevations plan details everything is being sort of streamlined into this one platform. The second thing it's doing is it's engineering the entire building and all of the assemblies that we are producing, it's engineering them custom to a thousandth of an inch. So we never build the same things twice. Just like your general contractor never does. Everything is custom to a thousandth of an inch. And the way we do that is the software is actually behind the scenes doing all that heavy lifting for us. The third thing it's doing so we're engineering it we know it's buildable we're seeing it visually which really helps with the decision making process and we are also streamlining again the backend deliverables out to the design community. But the third thing it's doing is it's pricing everything in real time to the set. So I never have to call my client and say really sorry, but actually it's going to cost us another four thousand dollars or fifty thousand dollars. I know immediately what that cost is and this isn't a high level budget, this is my actual cost to the client.

And the last thing it's doing which is the coolest part is as soon as my client says I love the way it looks, that meets my budget and you haven't told me that I can't build it. It's actually written all of the A.I. required for us to go to work within minutes and start to build every part and piece offsite using robotics and manufacturing. So taking all of that design intelligence and now actually having it produce all of your building materials. So how does it look once we get on site? Well it starts to make the construction industry a lot more akin to what we do in the automotive industry. We're not bringing raw materials to site and then having Joe and his friends hopefully construct the space in a way that reflects the drawings, we're actually producing it all in a factory. And it's coming to site and clicking together kind of like Legos. So everything from the Electrical to the data whether that's Cat 6 or fiber through to all of the wall assemblies which are going to be stood on site and zip together, nothing's being cut or finished or sanded. Those come equipped with whatever they need to from a technology standpoint, with plumbing, with data, with electrical. We're going to level the frames because buildings are never quite straight and then make all of those above ceiling connections that we first installed, install any integrated technology that needs to go within the cavity of those walls and then snap the tiles on and we're done.

So I'm going to walk you through three case studies just to try and land this and show you some examples of the work that we're doing in the U.S. specifically we're a 400 million dollar firm and we operate in 11 countries, the U.S. is our biggest market. Saudi Arabia is actually our second biggest market with Canada coming in third. I'm going to focus on three projects in the U.S. So this is Microsoft's offices in Detroit Michigan. We finished this six months ago a couple of quick highlights and photos from the project you can kind of see the scope of work here so a pretty densely constructed space everything highlighted in blue is DIRTT, along with all of the casework and millwork in the pantry areas and highlights of the scope of construction. So this was about a 40000 square foot space. Our multiyear trade umbrella was forty five dollars a square foot and we had a nine week construction timeline for our scope of work. What was in our scope of work was all of the wall assemblies that you saw highlighted which was all of the interior wall assemblies we didn't do any of the core of the perimeter, all of the wall engineering so that's the acoustical treatment, the blocking any of the utility that was running through the walls. All of the finishes and then integrated technology. We also did all of the pantries and conference room millwork, all of the arm wires and then we took over 40% of the electrical package on this project.

Second project JDA Software in Phoenix. Again some quick project highlights quite a bit more open plan in this project but a ton of technology, they had about 25 integrated monitors throughout the space. They are a software companies so they really wanted this to be a reflection of the fact that they are a tech firm. And some highlights here, 15,000 square feet this was $67 a square foot for our scope of construction and a five week construction schedule for us. Very similar scope of work except that we also did passive optical networks on this job.

So we were providing all of their network infrastructure including the backbone to the building. And then the last project which I can't say the name of but is a confidential financial services firm here in New York City that we're working on some project highlights on that.

This is just in construction so I'm just including some renderings and this is a typical floor plan. We're working with four different architecture firms and for GC's because we are building one point two million square feet in six months so there weren't enough people at each of these firms they couldn't award it to one firm. But they did award it to us as a turnkey prefab method. In order for them to meet their schedule our cost is about $37 a square foot depending on the floor plate. Each building is different. And we have a five week per floor construction schedule, largely very similar scope of work as the other buildings but we're only providing partial electrical assemblies because of the code limitations in New York and we're not doing any data here. So to summarize this is probably a lot of what you guys are currently going through with your existing construction process. You have a lot of uncertainty, you never know exactly what you're gonna get, exactly how much it's going to cost or exactly how long it's going to take and hopefully I've given you some food for thought on how you could be using digital construction and 21st century construction methods to be able to provide cost certainty schedule certainty and ultimately future proof your space. Thank you.

Cindy McLaughlin: Navigating Regulatory Technology To Build The Future

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Cindy McLaughlin, CEO of Envelope discusses the challenges of navigating the current regulatory climate and how technology will level the acquisitions playing field, allowing mom and pop developers to acquire buildings better, faster, and with more information.


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Cindy McLaughlin, CEO, Envelope

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VIDEO TRANSCRIPT:

My name is Cindy McLaughlin and I'm the CEO of Envelope. Somebody pretty smart on Twitter once said that technology is really good at taking what was once available only to the mega rich and bringing it down to the rest of us. So you have a vacation home in every city through Airbnb, you've got a personal driver through Uber, and you're in your bedroom is an in-home movie theater through Netflix. I'm here today to talk a little bit about how regulatory technology can do the same thing for real estate acquisitions. I'm also hoping to convince you that I will admit that regulatory technology is not the most exciting topic, but it's not as boring as you might think.

Before I start talking about regulation in real estate I want to start by pointing out that the vast majority of regulation is made by really thoughtful policy makers who have anti-corruption and safety in mind as well as managing growth and economic development. But as they say the road to hell is paved with good intentions. And regulation has a nasty habit of piling up. It happens because each new political administration has its own priorities that need to be encoded. It happens because you find loopholes that need to be closed and it happens because unintended consequences of prior regulation need new rules to dial them back.

To get very concrete about the problem in New York City, the index for amendments alone and to the construction code are 400 pages single spaced. The building code is 35 chapters with 19 appendices. The zoning code is 4,000 of legal text. It fits inside one of those big boxes of printer paper. As you can imagine an enormous cottage industry of lawyers, lobbyists, consultants, advisers, have sprung up to help real estate industry professionals access, understand, navigate, sometimes evade and often times lobby to change the rules.

I'm going to talk a little bit about zoning because it's the regulation that I know best. Practically speaking if you're a real estate developer in New York City and you want to know what's possible to build on a particular address you're probably going to call an architect or a zoning attorney. If they have time, they're probably going to print out the relevant portions of the zoning resolution with a highlighter pen. They're going to understand the rules and if they're fancy they're going to build a three dimensional model either hand drawn or they're going to build it in desktop software. They'll email it over to you, you'll take a look and you'll say, well what if I were to add a community facility to the ground floor of my building? Or what if I were to change the floor to floor height? What would happen. How much square footage could I get out of that building? And you're going to kick off a game of email ping pong that can take days or weeks and can rack up fees between twenty five hundred dollars up to twenty five thousand dollars depending on the complexity of the development. Assuming that you're going to look at more than one property before you make an offer on a single one, you need to have a cool 25 to 50 thousand dollars sitting around just to explore your options. To put this kind of capital in context. The median income of New York City households is fifty thousand dollars. So if you're an individual if you're a mom and pop development company you simply don't have the means to do smart real estate acquisition because you need to be able to do the level of analysis that I just addressed. But the big guys are very willing to pay.

Like most good government tools zoning sounds boring, but it is in fact a secret means by which cities are shaped and fortunes are made. Zoning essentially serves as a paywall. Only those who can afford to navigate it can make their fortune in the industry it regulates.

So circling back to the point of this talk, can regulatory technology help with this problem? I'm going to talk a little bit about my company envelope. There are companies like mine that are handling different portions of the regulation. We happen to be building the three building the 4,000 page zoning resolution into three dimensional software.

To walk you through what the software is doing, we let you enter an address and very quickly we show you what's built there today and we show you what the three dimensional spatial constraints of zoning allow you to do. So where there are height limits, where there are setbacks, where there are yard requirements and we do that across all of the cellblock conditions of that particular parcel. We then make a recommendation as to the use type that's going to allow you to maximize your floor area. This is a commercial building. But you could play. You could say what if I were to do a residential building with a commercial ground floor. Or have three floors of commercial. Or what if I were to change my floor to floor height, how much extra extra square footage could I get out of my building. Or what if I were to take that inclusionary housing bonus that happens to be available on that parcel. Or add air rights from my neighbor or my other neighbor. And what if I were to caterpiller my way around the block until I can fill out the zoning envelope. What would happen if I were to add dormers to get a little bit of extra square footage. And anything I can do on a single lot. I want to be able to do across multiple adjacent lots as an assemblage.

In essence we're building sim city for real life, trying to take the wild complexity of zoning and build it into something that's accessible, useful and even kind of beautiful. Companies like mine have started out working with industry because frankly, they're the ones who can pay us in a way that we can invest back in our technology but eventually we hope to be able to provide our software so cheap or free so that anybody who has a parcel of land can understand how to maximize the value or the productivity of that parcel. They might find air rights that they didn't know they had that they could sell to their neighbor and it would allow them to speculate themselves on other lots for investment properties.

Regulatory software is pretty siloed. We do zoning, it's our area of expertise. Somebody else does building codes, somebody else does mechanical code, but in the not too distant future, we're all going to be holding hands. And well we're showing you what you could build in terms of square footage. We'll be partnering with companies that are already building in three dimensions, the building code that shows you the egresses and and mechanical code, and plumbing code software. And eventually will form in three dimensions a regulatory scaffolding that will allow you as a potential acquirer to say, very quickly, what are the bones of my development going to look like, what is this going to take and is it worth it for me to acquire this parcel. In this way we think that regulatory software is going to level the playing field in acquisitions allowing mom and pops to be able to do the same kind of exploration as the big guys. We're going to try to make this industry a little bit more fair and a little bit less rigged in favor of the very wealthy. Thank you very much.