Real-estate-as-a-service : The servitisation-led transformation of corporate real estate

The onset of the Fourth Industrial Revolution has immutably changed not only how products and services are produced, but also the way they are delivered and consumed. Enabled by advances in technology such as sensor networks powered by the Internet of Things (IoT), cloud computing and big data analytics, the servitisation-led transformation of business models emphasises a provision of ‘access’ rather than ‘ownership’. In other words, end users pay for ‘service-based outcomes’ instead of the ownership of products. Business models employing servitisation strategies are broadly categorised as ‘everything-as-a-service’ (XaaS) and are likewise increasingly found in corporate real estate (CRE). Real-estate-as-a-service (REaaS) points to an amalgamation of various XaaS models that are now proliferating in the CRE space. Such services are popular, given flexible consumption pricing structures whereby access to space, amenities and services is scalable and provided on-demand, freeing the end user from the financial burdens of asset ownership and the risk of obsolescence due to advances in technology. In the process, REaaS also creates new possibilities for CRE’s future where the importance of physical real estate assets in creating business outcomes, operational efficiencies and employee engagement may potentially diminish. This paper explores the servitisation-led transformation of CRE by discussing its origins, underlying drivers and challenges, in linkage with overarching industry themes, with the aim of adding cross-disciplinary insight to the literature.