Last week I sat in on GlobeSt.com’s Webinar entitled “The Intersection of Technology and CRE”. Thankfully it was one of the more interesting and informative Webinars that I have attended recently. The presentation covered a variety of topics and moved at a quick pace, which I really appreciated, as patience is not one of my strongest virtues!
The topic on their agenda that I was most captivated by was how driverless cars are set to be the most disruptive force in commercial real estate.
Until a few days ago, I believed that autonomous cars would become a mainstream reality sometime in the distant future. However, GlobeSt.com presented two very good reasons why this technology may become commonplace much sooner than most of us would have anticipated.
The first is public safety
This one is a no brainer, because let’s be honest, between being distracted, in a hurry, exhausted or in a very bad mood, the majority of us are quite dangerous behind the wheel. A computer that can detect its surroundings and make split second decisions with no human factors running interference will greatly reduce the number of accidents, serious injuries and fatalities.
Second is limitations on infrastructure
In many cities, especially very densely populated ones, there is no space available to expand the existing infrastructure. So the only option is to make more efficient use of what we already have. And even if the space did exist to expand, it’s certainly more cost effective to make better use of what’s already there.
5 advantages of driverless cars...
- no driver errors
- they don’t rubberneck
- they can safely follow closer, even forming “bullet trains”
- lanes can be narrower (i.e. more lanes on existing freeways)
- less parking needed in congested areas
So purely from a fiscal perspective, governments have a vested interest in both improving public safety and making more efficient use of existing infrastructure. Consequently they are more likely to pass legislation and provide funding, rebates, etc. for initiatives that push the adoption of this technology along at a faster pace.
Then there is the personal benefit factor. I believe that once this technology becomes more of a reality, people will be very much on board with being free to do anything they want during their work commutes and trips to visit friends and family.
Driverless car market watch (Autonomous cars from major manufacturers expected to hit the road in 2020 and predicted to become mainstream worldwide by 2025)
So how will driverless cars impact commercial real estate?
The paradigm of location, location, location will likely shift. The fact that passengers will be able to multi-task during trips will make many people much more tolerant of longer commutes, making location much less important. This will result in a reduction of premium prices attached to locations that are in close proximity to public transportation and major transportation arteries.
The availability of parking spaces in densely packed downtown cores will also be less of an issue, as cars will be able to drop their passengers off and then self-drive to park at a different location. Also, buildings with parking space available will be able to fit more cars as they can be parked closer together. This will change the way that buildings are designed as they will not need to allocate as much space to parking.
When self-driving cars become a mainstream reality, what are you most likely to with your time during longer commutes and trips? Comment below.
As experts in property management who strive to be a valuable resource for our customers, we continually have our eyes on the latest trends and potential developments in this industry. Like good scouts we work hard to BE PREPARED!