Building Experiences

New Role for NFTs

By Bernie Devine on Dec 5, 2021 in Global

Non-fungible tokens, or NFTs, may have been attracting headlines for the eye-watering sums splashed on digital artworks and virtual land. But behind the hype is a digital key that can help the real estate industry create better experiences in their buildings, foster engaged communities and, ultimately, unlock new value.

Mars House, a digital home designed by Toronto-based artist Krista Kim, sold for more than half a million dollars in 2021, changing the way we think about virtual real estate. By the end of the year, a virtual plot of land in online world Decentraland had sold, using an NFT, for a record $2.4 million worth of cryptocurrency.

A lot of folks in the real estate sector have made the mental leap and are looking at how NFTs can support fractional ownership and debt financing. But to my mind, what’s even more exciting is the role of NFTs in the future of the workplace.

A “non-fungible token,” as the name suggests, is a unique digital item stored on a digital ledger called a blockchain. Ownership of an NFT is easy to certify and transfer, which is why they are being used to tokenise unique items like art, collectibles and real estate.

But NFTs can be a bridge between the digital and physical worlds. NFTs can be used as tickets or membership cards, giving people access to events, experiences, products or discounts.

Imagine attaching an NFT to each service in a building? Think treadmills in the office gym, entry to Friday night drinks on the rooftop terrace, discounted movie tickets at concierge or yoga class reservations. Each unique NFT can connect a smart building to smart contracts to provide smart services.

This idea may sound revolutionary, but it is simply another evolution of the office.

The office has always moved with the times. From factory-style rows of desks to cubicle farms to coworking spaces with hang out zones and hockey tables, the office environment has always adapted to suit the age.

What hasn’t moved with the times is the relationship between the tenant and landlord. Sure, the space-as-a-service giants like WeWork were shaking things up pre-pandemic, and that was challenging people to rethink the office experience. Large landlords had started expanding the suite of services they offered, rolling out the occasional app, and seeing their non-rental revenue grow. But, in general, the landlord’s relationship with the tenant remained unchanged: lease a space, collect the rent, maintain the reception, operate the lifts and keep the building ticking over.

Now, after nearly two years of working from home, people still see real value in their office. But they want space with the comforts of home, the convenience of a five-star hotel and the aesthetics of an on-trend café. The office must now “earn the commute.”

Landlords can’t make the mistake of thinking a few licks of paint, new lighting and a fresh layout will do the trick. People are looking for the same seamless and personalised experience offline that they expect online. That means thinking about the services that can boost performance, enhance human health and wellbeing, and inspire people to enjoy work.

But delivering a wider array of services brings new layers of complexity. Landlords must bill for events, for time-based activities, for specific conditions and for bespoke services. How do you write all these services into leases? This isn’t simply a matter of choosing the right legal terms, asking the accounts to bill and then expecting the facilities management team to deliver. We are moving beyond the monthly rent roll invoice, and an Excel spreadsheet is no longer fit for purpose.

This is why NFTs are so exciting. Not only can they help landlords to package, price and deliver a range of services; they can also provide access to deep lakes of data so we can better understand how space is being used. In doing so, they can create a strong and enduring relationship with their customers.

There’s a lot for us to learn before people start scanning NFTs to sit down at a desk or grab a cup of coffee at the in-house café. We need to reimagine and redefine billing. We need to rethink the lease. We need to write new business processes into our software. Most importantly, we need to start seeing a building as a device.

Our buildings are not just bricks-and-mortar. They are devices that can boost productivity, performance and human experience. Shifting our thinking will change the way buildings are designed, how services are provisioned, how assets are valued and how customers interact with space.

NFTs may have helped people monetise digital artwork and virtual land within the metaverse this year. But their role in the real world will help us create better experiences, more valuable assets and stronger relationships.