When I am asked about the potential of blockchain and crypto technology in the real estate industry, I have a vision of completely autonomous buildings.
With this idea in mind, picture yourself an empty building. In order to generate revenues, the building must look for tenants. Therefore, it autonomously places ads to showcase the available space and addresses potential tenants directly. The tenants are carefully selected through a screening process. Once the appropriate tenant is found, the lease agreement will be finalised and the virtual key will be transferred to the new tenant. At the same time, the building itself organises moving services and makes sure that the building’s address is linked with the tenant’s identity and sends it to the local registries, banks (if they still exist by then), telecom service providers, etc. Lease payments occur automatically thereafter. Utility prices, repairs and renovation and contract terms in general are negotiated through an algorithm and stored on the blockchain.
If we go a few steps further, autonomous buildings will be able to finance themselves by closing deals with investors and lenders. Should a building no longer have demand for its service and find itself at risk, it could destroy and rebuild itself. Crypto currencies, tokenisation and smart contracts in combination with other technologies such as IoT, AI or quantum computing will make this possible. Future customers will benefit from real estate products and services based on their individual needs.
When I discuss these ideas, people often tell me: ‘Well that sounds cool, but you don’t need blockchain and crypto to implement these ideas: current technologies are already able to do that.’ That may be true, but I think it’s the wrong approach. We should use blockchain and crypto and the potential they offer to bring efficiency and trust to digital transactions and to ‘cut out the middleman’ right away, instead of using already-existing technologies. If we had continued to use typewriters instead of computers, would the internet and social media platforms exist today? It is only by using available technologies right away that we can unleash the potential of future innovations – progress that we cannot imagine today.
Guest Blog by François Bernath, Head Acquisition, Alfred Müller AG