Proptech: how to stimulate infrastructure development

Disruptive influence

7 August 2017

How can proptech stimulate much-needed infrastructure development? RICS sought the opinions of thought leaders on this issue project

The desire to invest in infrastructure is now at the top of the political agenda on both sides of the Atlantic – but how can property technology, or proptech, play a role in this?

RICS brought together thought leaders from across the sector (see figure) to address the key issues – first and foremost how clients must see data as a business asset. When working on large infrastructure projects and managing their assets, the quality of data and how and with whom it is shared are major concerns.

Figure

 

Technology can both streamline and disrupt traditional ways of working, and the government has an essential role in overcoming obstacles. On one point, the panel was unanimously agreed: the client of the future should be prepared to embrace change, and proptech professionals are the ones who should be starting these conversations.

Let’s start by discussing the relationship between data and infrastructure – where do you think the challenges are?

KJ: The basic problem is that there’s too much data. Information overload is what we’re dealing with every day.

AC: You need the right data to enable informed decision-making. I don’t think we’ve seen ‘peak BIM’ (building information modelling) yet. We have more than enough data – it’s the systems engineering approach that’s missing. I call it the golden thread running through BIM, from land acquisition, valuation, design and construction to, at the other end of the process, asset management and asset performance. If we can crack that, we can solve a lot of the industry’s current problems.

JB: The fragmented nature of infrastructure owners is a big issue. The key thing is the lack of information around the built environment. There’s huge innovation going on in data monitoring, both above ground and below ground. But there are still huge gaps. Technology can only go so far.

What data is missing?

JB: UK plc needs to get a much better handle on underground assets, with a focus on street works. We need to coordinate information – if I’m digging a hole, who else has got assets in this location? Coordination can be achieved by developing very simple standards. But trying to share practices across 250 stakeholders who own those assets is very difficult. The biggest challenge? Legacy: 90% of the information we have is historic.

KJ: From a contractor’s perspective, you’ve got to understand that the design life of infrastructure is much greater than that of a building. Roads are there for centuries. But when you dig a trial hole, you may find that kerbs have been moved and overlaid, and so cables that were under the footpath now run underneath the road.

MT: Crossrail has done a lot of ground radar. We put it all into GIS (geographic information systems), went out and dug lots of trial holes to verify the data, and shared it with everyone who needed it. When we leave, we’ll have a complete 3D picture around our sites. When we first got into those areas, we didn’t have a clue.

KJ: Buying up-to-date mapping data from the Ordnance Survey is incredibly expensive. Should it be free? There’s a strong argument in favour.

AC: Look at Transport for London (TfL) and national rail operators – they’ve made all their real-time service data freely available, and have let the market respond. Third parties have created smartphone apps such as Citymapper, allowing people who are using the infrastructure to interface in a totally new way – this is the kind of thing which is going to drive change.

MT: The problem I’ve got with TfL is that, while its data might be amazing from a customer’s point of view, when it comes to asset management there still isn’t enough of the right data. To manage an asset effectively, you want to have as little data as possible.

What can be done to help with the flow of data?

SM: Our clients are very reluctant to release data that could be used to make forecasts of asset performance. That’s their intellectual property – why should they give the competition insight?

AC: Clients need to take an intelligent approach. They often have the data but aren’t able to use it themselves across different buildings.

KJ: As a contractor, we don’t own the structure. We work on it, and pass it over to the client. Often, clients don’t want to share data. Many have security concerns.

TS: The danger with BIM is that people get so carried away with 3D modelling and pretty pictures they forget that the 'I' – information – is the most important.

JB: At Terminal 5 at Heathrow Airport, we put GIS at the heart of the BIM process. Too often, people think BIM is just about buildings, which is why I don’t like the term. BIM is a combination of computer-aided design (CAD) and GIS, which have been in separate silos for years – they shouldn’t be.

How does this relationship need to change in the future?

JB: The issue for BIM is that it tends to look at infrastructure data through 3 separate lenses – getting a construction or project view, an asset management view over the life of its operation, or a customer-centric view. The golden thread is to identify what the infrastructure aims to achieve and improve the outcome of, then feed the data back into, the project, so you can start to use it to predict future infrastructure requirements.

SM: We need to have joined-up databases that enable you to access the information you need and make decisions more quickly.

TS: The Internet of Things and radio frequency tagging mean that inanimate objects can tell you a story and feed information back. Look at smart buildings – they’re monitoring energy usage and turning the lights on and off, while compiling data about how rooms are used. Leeds City Council is already using that kind of data to reduce its commercial building stock.

JB: There is a revolution across all industries to create information-centric strategies. If you centralise information in the cloud, it’s all in one place – you leave it in data lakes. Technology lets us search that unstructured information and grab what we want.

Infrastructure is designed to last for decades or more, whereas technology constantly changes. How do you reconcile them?

SM: Technology is moving much faster than immobile built environment assets can ever change. We are at the point where artificial intelligence (AI) and deep learning, a type of machine learning, could outstrip human capabilities. I wouldn’t trust AI to build an asset for me today, but we’re in a transition zone – look at self-driving cars.

TS: Generative design – where the computer does it for you – can only work if the data’s good.

KJ: For now, there’s still a lot of uncertainty. You don’t know what you’re going to find until you start digging and technology can only tell you so much. But we have radar, excavation controlled by GPS, and equipment that can be operated remotely.

WN: All of this is going to change when AI turns into artificial superintelligence – that is the moment that we all become redundant as humans. These wonders ultimately rely on decent data. In the future, AI could scan the data and use feedback loops to work out where it is likely to be wrong.

How well prepared is the property and construction sector to deal with the challenges technology will bring?

AC: We need intelligent clients – and Crossrail’s Learning Academy is a prime example of how to be an intelligent client. If a client constantly drives down the price, they’re not going to get innovation. By innovation, I’m talking about off-site management, prefabricated materials, 3D printing – how do we start to bring these in? If we get this right, the reward will be increased cost certainty in the construction phase, and then into the asset management phase.

If a client constantly drives down prices, they’re not going to get innovation such as off-site management or 3D printing

JB: Clients have got to see information as an asset that’s valuable. We have to communicate this message to clients – they understand reducing costs and the risks downstream of managing an asset.

PHB: It takes real courage getting a client to ditch old technology. Take the train industry – there are still paraffin-powered signals in Wales.

MT: You’ve got to have a transition period where you run 2 systems – they can’t change overnight.

KJ: As fast as we create something, there’s always something new around the corner. It’s the technology we haven’t thought of – look at Uber and Airbnb and how they’ve disrupted traditional sectors.

What is the kind of technology that is going to disrupt the property and construction industries?

TS: I am fascinated by 3D printing. In China, they’re able to make 3D-printed houses for less than $5,000. There’s a 3D-printed bridge in Amsterdam that’s been built across a canal. And then there’s robotic bricklaying – the Shanghai Tower was built in less than 16 weeks.

PHB: We’ve already witnessed a revolution on construction sites. It now takes relatively fewer people to build. When you make the systems people work with automated systems, you increase productivity. When major projects such as HS2 (High Speed 2) hit the ground, 3D printing could be the answer to the skills crisis we’re currently facing.

What do companies need to do now to ensure they can capitalise on this?

JB: What we’re witnessing in other industries is the rise of the CDO – the chief data officer. When will we get a CDO at a major property company? A lot of major industries are starting to recognise the importance of data as an asset in their business.

And finally, investing in infrastructure is becoming a much bigger government priority – on both sides of the Atlantic. What measures do you think the UK government could take that would bring benefits?

JB: The government itself should lead the way and become a much better client, show leadership in what it wants, and encourage supply chain innovation across the sector.

AC: Pensions funds and infrastructure investments go hand in hand. They have long investment horizons, and a highly predictable income stream. That’s why City Airport sold for [such a high price] to a Canadian pension fund.

WN: One thing that the government could do would be to push on with the Open Data Project started by Sir Tim Berners-Lee. There’s a whole lot more data it could push in – including the Ordnance Survey MasterMap, Land Registry data and information from the former Department for Business, Innovation & Skills. These data sets are not necessarily infrastructure-related, but they open up information about companies beyond what you get in Companies House. And the UK is great at innovating.

MT: The only reason we’re not seeing so many plastic bags in supermarkets is because the government has legislated. Similarly, it can force businesses to manage their assets properly treat buildings as a resource if it legislates to do so.

The first in a series of RICS ‘white paper’ debates, the event was chaired by Claer Barrett, editor of FT Money, on behalf of RICS in November 2016

Further information

Download a complete “Proptech: how to stimulate infrastructure development” PDF