“…the entire field of the real estate industry and all its stakeholders are in a state of upheaval. Of course, the exact development cannot be predicted, but you will not be able to sit this trend out.”
Matthias Standfest, Innovation Challenge Bet Co-Captain
Dictating the possible
We are all stakeholders when it comes to real estate. In Switzerland, as well as most of Europe, boundary lines (BL) for every square meter of space are enshrined as BZO (Bau- und Zonenordnung). Authority is decentralized. Each municipality dictates what is, and what is not, possible to construct above and below ground within the borders of their community.
The Challenge bet, Digitalization of Building and Zoning Codes (BZO), is an attempt to give urban planners, architects and property developers better tools that will translate into better outcomes for Swiss residents. Digital tools which look like science fiction – but thanks to the ingenuity and collaboration required to deliver on this bet’s promises, are as real as the spreadsheet and blueprint they replace. Light years more real, I learned, after speaking with the bet’s Co-Captains in early March.
Low-tech for high-stakes
Logically, regulated (real estate) space occurs in three dimensions (3D). But in practice, BLs and BZOs exist in one or two dimensions: pages of text or line drawings. The closest approximation to visualize a planned structure in 3D has been those fragile-looking vertical sticks (Baugespann) swaying in the wind at proposed building sites. Municipal BZO mandates their precise placement to solicit public comment prior to permission to build. Such a low-tech medium for such a high-stakes game seems almost nostalgic.
Inside the mothership
In 1977, the first Star Wars movie (Episode IV – A New Hope) was released, giving millions of people their first immersion into 3D VR (virtual reality). Twenty-four years later, two die-hard Star Wars fans, Martin Meier und Christoph Altermatt, finished their studies and left the orbit of Zurich’s ETH in their new startup, Raumgleiter AG. Their mission: 3D visualization for real estate projects. Lacking Hyperdrives, Raumgleiter and their technology, would require another twenty years to reach their current incarnation they call, “digital Doppelgängers of construction projects in virtual space.”
The air held an unmistakable tang of unburnt electro smog. Instead of human conversations one might expect in an office with twenty plus employees, only a pervasive whirring sound emanated, I presumed, from hundreds of tiny fans cooling banks of graphic cards and memory chips. There was no mistaking I was inside Raumgleiter’s Zurich West mothership.
Digital leap forward
When announced in April 2017, this bet promised three deliverables. Each would be an extraordinary digital leap forward for the Swiss real estate sector, but none could happen without the others.
The team bets that 1) it will be possible to map the building and zoning code into a machine-readable source code in an open standard by June 2018. The team also bets that 2) it will be able to offer a web-based service for automated volume determination and collision checks by August 2018. And 3) it bets three municipalities will publish and apply a machine-readable source code in addition to the normal legal code by April 2019.
The first hurdle, digitizing a municipal’s text-based BZO, was overcome the hard way. Knuser admitted, “… we’re doing it by hand … one person sitting there and going through every paragraph.”
One-off and it’s done
Reacting to my raised eyebrows, he said, “it’s not that big of a deal. You just have to translate from human, a sentence, and filter that information … basically it’s key pairing, this value is this and that value is that. Then the (artificial) intelligence knows.” Despite converting the first BZO manually, Knuser assured, “that’s okay. Because it’s a one-off and in a few days, it’s done.” Raumgleiter client, Dietikon, was the first city to digitize their BZO. Urdorf followed and a third community in canton Bern will be announced by April 15.
Delivering on the second claim stymied the bet for over a year. The reason? Neither Co-Captain could make a business case for the necessary time investment. A breakthrough came about during a meeting between Knuser and Co-Captain, Dr. Matthias Standfest, CEO and Founder of proptech start-up, Archilyse AG. Knuser recalls the two were discussing calculations needed for buildings’ volume checks when Standfest suggested, “his people could probably do that.” Knuser told me Archilyse have astrophysics and mathematics experts, “… who don’t have anything to do with architecture, but they’re really good coders and can do cool calculations.”
A week later I visited Archilyse’s CEO in his Technopark office. As with so many other challenge bets, solving innovation puzzles requires finding the right pieces. Standfest agreed, “You need to find the right players.”A prime example was how they got their first city on board to digitize BZO. He recalled, “Last spring, we went to Dietikon and did a proof of concept scenario, checking what would be the maximum you could develop in this area of Zurich. This was only possible because Raumgleiter is doing this amazing Limmattal project and already had connections with them.”
Once all the pieces (or players) were in hand, Standfest said, “Technically, it was done quite fast, we implemented in roughly a month.” Mission accomplished? He gave me a knowing look of someone who has seen many innovative ideas languish, “This is this hen-egg problem. You need to have a way to get this intelligence to customers, but sometimes you only get the customers when you have some intelligent product to provide.” In other words, the space station is built, but (paying) customers need a way to input their data and receive back answers.
Perhaps unsurprisingly, the dream team of Standfest and Knuser had anticipated this problem. On February 27th, Raumgleiter launched Archscape, a web-based interactive platform for 3D visualizations, presentations and what else? Exactly. Volume determination and collision checks. Using Archscape as a front end, urban planners and architects can find out in seconds, what used to take months, if a proposed building’s volume conforms to municipal BZO or instantly double check routing “collisions” between wires, ducts and pipes.
A final note for Zurich residents. Standfest told me the city government is re-doing its building zone regulations because during the next ten years, they intend “densifying” the city’s population from 400’000 to 500’000. He said, “Densification is done via changing the zoning restrictions. This is where our (bet) stuff comes in handy.”
He was alluding to the economic benefits for developers and architects who can now check volumes and simulate their ideas at light speed. He also pointed out, “There’s always two sides of the coin to consider when talking about automating these compliance checks. Urban planners need to simulate changes in the BZO and their effect on the urban fabric (before) densifying neighbourhoods.”
What began as an ambitious challenge bet, has resulted in shared revenue for Archilyse and Raumgleiter, while positioning both companies as leaders of the digital real estate revolution. With only a few days until a jury selects the winner at digitalswitzerland’s Demo & Pitch Day, this bet has to be considered a frontrunner.
Come and visit the Open Demo Day on Monday September 15, 2019 -14:00-16:00 (open to public).