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PurposeThe aim of this paper is to introduce a framework that helps to identify strategic themes on which real estate investors form their strategies. A holistic approach to strategic management in real estate management has enjoyed popularity in corporate real estate research, while similar research has been lacking from the investor-based real estate management.Design/methodology/approachThe research design consists of two main parts: 1) formulating propositions based on existing literature and 2) attempting to validate the propositions through a qualitative interview study with major real estate owners in Finland.FindingsThe main finding is that the current real estate investors reflect the transient nature of competitive advantages and assess their strategies accordingly. The companies consider the traditional profitability and revenue growth aspects of their business but also a more long-term future growth dimension. As an outcome, the investors base their strategies on eight strategic themes which are “Innovation”, “ESG”, “Marketing and sales”, “Financial management”, “Leasing management and tenant satisfaction”, “Competitive environment and portfolio management”, “Outsourcing and strategic partnerships” and “Cost and operation optimization”.Research limitations/implicationsThis paper opens opportunities for future research concerning different strategies in real estate investment business and their impacts.Practical implicationsThe presented framework provides support for real estate investors to create real estate management strategy or to evaluate their current strategy and to recognize operational actions and decisions that are relevant for their strategy.Originality/valueThis paper provides an extension to corporate real estate (CRE) literature by showing that the CRE theories are adaptable to real estate investment and provide value for their strategic management. This paper also contributes to real estate investment literature by providing a well-founded and empirically contested strategic management framework, the IREM framework, for identifying strategic themes on which real estate investors form their strategies.

Inter-firm collaboration has increased significantly in the last decades. The concept of ecosystem has emerged to explain the nature and implications of businesses’ increasing reliance on networks. The ecosystem concept is intended to be generalizable across sectors, but research on ecosystems has focused on high-tech industries. Moreover, the construction industry has special features that differentiate it from other industries. In this paper, the concept of the ecosystem is introduced and developed in the context of the construction industry and the relationship between ecosystem characteristics and value creation in construction networks is examined. Based on a multiple-case study of six networks in the Finnish and Swedish construction industry, it is suggested that the ecosystem concept is applicable and offers a useful analytical lens for understanding value creation in the construction industry. The results suggest that operating according to ecosystem principles is positively connected to value cre...

Current theories on commercial urban development are dominated by the concept of linearity, which does not adequately take into account the demands of adaptation posed by the pace of change in digital developments, a pace that stands in marked contrast to the pace of change in physical developments. In the hi-tech sector, platform ecosystems have been employed to accommodate innovation and change. This paper explores the potential application of platform ecosystem theory to the commercial urban development process, where there is now great uncertainty regarding the future economic implications and societal requirements of physical commercial space. The boundary conditions for value creation in platform ecosystems are as follows: modularity, standardisation, complementarity and connectivity. Each is explored through a survey of key actors in recently completed commercial urban developments. The analysis identifies significant differences in the capacity of public- and private-sector actors to promote the creation of platform ecosystems, particularly in the complementary actions of development participants. Applying an approach to urban development based on a platform ecosystem might offer great opportunities, but will also be limited by the major challenges identified in this paper.

The low-energy and the nearly zero-energy buildings trend is calling for radical new innovations from the construction industry. This study uses path creation theory to examine two innovation concepts for low-energy housing in Northern Europe with contrasting outcomes—with one being an apparent market success and the other a disappointment. The results highlight two issues behind the success, one of a systemic nature and the other concerning innovation management. First, the development of energy efficiency regulations and the dominant technological trajectory regarding low-energy houses are interdependent. However, it seems that while supporting the trajectory of the innovation developed in the first case, regulators created virtually insurmountable cognitive and normative obstacles to finding alternative technological pathways. Second, the significance of proof of concepts for new innovations cannot be underestimated. The importance of a pilot project rests not only on showcasing and testing the technology,but also on its ability to increase political support, investments, and public awareness. The study implies that low-energy construction seems to be the next great challenge, one where genuine co-operation between the industry, public authorities and academia is a prerequisite for success

PurposeThe main aim of this paper is to examine how commercial sustainability innovation projects in real estate and construction industries utilise the contemporary market‐oriented innovation models based on the service‐dominant logic.Design/methodology/approachA survey of a large set of sustainability innovation projects was conducted and analysed.FindingsThe results show that over a third of the examined projects lack all the necessary innovation components recognised in the literature. Furthermore, very few projects utilised concurrent market feedback in the development phase. The study suggests that sustainability innovations fail commercially in built environment, because they lack active customer participation and value network involvement, and they aim for incremental instead of radical improvements.Research limitations/implicationsFuture research should address available ways for companies in the real estate and construction industries to take advantage of their unused potential in climate change mitigation business through innovation.Practical implicationsOrganisations striving for sustainability innovations should aim at radical instead of incremental innovation, and focus on customer participation and involvement of the value network. The innovation processes in the construction sector could be organised better by utilising tested service‐dominant models.Originality/valueThis study is among the first to address innovation elements based on the service‐dominant logic in analysing projects aiming at sustainability innovation in real estate and construction industries.

The possible connection between sustainability innovations and the market capitalization of construction sector companies is examined. This is the first known study to test statistically the connection between sustainability innovations and the market value of companies in the construction sector. An event study model is used to analyse sustainability innovation announcements and financial information of large construction sector companies in a number of countries. The main finding of the analysis is that a positive and statistically significant association exists between sustainability innovation announcements and the market value of companies in the construction sector. According to the results, sustainability innovation announcements explain an increase of 0.82% in the market capitalization of the studied companies. The findings are in line with earlier studies suggesting that investments of construction sector companies in sustainability can lead to the creation of economic value. The results imply th...