Transformation of the real estate and construction industry: empirical findings from Germany
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Transformation of the real estate and construction industry: empirical findings from Germany Andreas Pfnür1 · Benjamin Wagner1
© The Author(s) 2020
Abstract The German real estate and construction industry is facing a transformation, trig‑ gered by fundamental changes in technology, the economy and society. The purpose of this paper is to explore how these changes exert pressure to adapt on existing business models, while also offering opportunities for their further development. A model that attributes the transformation of the real estate industry to megatrends, specific structural change drivers, business models and the interaction of the groups of players in the value creation system is developed. The model is tested empirically by a survey. Structural equation modelling is used to measure the impact of various determinants of transformation and the relevance of adaptation strategies to the dif‑ ferent groups of players. As a result, the study explains three impact mechanisms of the transformation in the real estate industry. The transformation originates from the occupiers, who need more flexible space and are focusing on holistic solutions that are not provided by the real estate industry. Service providers are striving to increase the efficiency of their traditional processes, rather than evolving new business mod‑ els or services. The investors recognise the increasing importance of the occupiers but they are rarely pursuing the resulting strategies. Property developers recognise these requirements: their adaptation strategies most strongly question their previous business. For practitioners, the results point out the opportunities and risks of trans‑ formation and help to illustrate the need for change. For academicians, the results indicate a way to explain and measure the transformation of a value creation system. Keywords Real estate management · Real estate transformation · Structural change · Strategic management · Real estate trends JEL Classification R30 · O33 · Z10
* Benjamin Wagner [email protected]‑darmstadt.de 1
Chair of Real Estate and Construction Management, Department of Law and Economics, Technische Universität Darmstadt, Hochschulstrasse 1, 64289 Darmstadt, Germany
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A. Pfnür, B. Wagner
1 Introduction The real estate industry in general and its business models in particular are fac‑ ing a transformation, caused by fundamental changes in technology, economy and society. The impending transformation process results from structural change. At congresses, meetings, conferences and particularly in practice-oriented manage‑ ment studies, megatrends such as digitalisation, urbanisation, globalisation, sus‑ tainability and even socio-demographic change, as well as more specific drivers of structural change, are being widely discussed (e.g. Zeitner and Peyinghaus 2014; Baumanns et al. 2016; Weber 2017; Saiz and Salazar 2017). Compared to its practical relevance, there is scanty academic research on this topic. The focus of the present paper is on analysis of these c
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