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For ages, real estate has been defined by the tangible: buildings, land, square feet. Nowadays, however, the worlds most valuable businesses make their money from what is intangiblebrands, networks, knowledge, and experiences. As of 2020, 90% of the value at the S&P 500 comes from intangible assets, up from 32% 40 years ago. The equivalent figure for major European companies lags behind, at just over 74% in 2020, a factor that likely contributes to Europe’s lower growth rate and per capita GDP. Much of the difference is made by a few unmatched American technology platforms. Real estate, too, must evolve beyond its physical footprint. At Atrium Ljungberg, where I work, we started that process a long time ago. Our market offering is not only built on bricks and mortar, but interactions and services happening inside and between offices, apartments, and retail spaces. This makes them greater than the sum of its parts. Our portfolio is more than a collection of buildings: It is the life between buildings. For that reason, we dont operate buildings separately, but focus on developing large, interconnected districts. In a way, we could be seen as a platform company, enabling people, businesses, and ideas to connect and grow. This philosophy drives our megaprojects redeveloping parts of Stockholm. Real estate as a platform business At their core, platforms create value by coordinating interactions, reducing barriers and transaction costs, and enabling large-scale economic activity through network effects. The highest-performing businesses on the S&P 500 today create ecosystems where value is co-generated, but facilitated by these companies. Of the worlds 10 largest companies by market capitalizationfrom Amazon and Alphabet to Metaseven can be considered platform businesses. All sprung up in the last two decades. Sweden’s most valuable company, Spotify, fits into the platform archetype too. Let’s apply platform logic to urban environments. A thriving city district is a dynamic system where different actorsresidents, businesses, visitors, civil society, cultural institutionsinteract in ways that ideally enhance each others experience. The role of a developer, then, is not just to build and lease space but to curate and connectfacilitating an ecosystem where people and businesses can thrive. This includes thinking beyond the traditional landlord-tenant relationship. A more holistic approach ultimately delivers increased value also to individual tenants. Just as nightclub owners need the right crowd, we carefully consider the first tenants in our developments: Who will create the most value for others in future? They lay the foundations for whoever comes next. This is also how you must start growing a platform. Weve introduced flexible memberships that allow businesses to access workspaces across different locations. Weve partnered with mobility providers to offer shared transport solutions that reduce car dependency. Weve invested in cultural programming that extends a districts life beyond office hours. In each of these cases, our broader ambition is to generate lasting impact for our customers and other stakeholders, including city councils. Why we report livability to financial markets Urban environments have always derived their value from interaction, not just location. The classic example is the agglomeration effectwhy businesses cluster, for instance, in financial or life sciences districts, or why creative industries thrive in repurposed warehouse spaces. Its no secret that economic productivity is shaped by knowledge, relationships, and cultureand you likely see this in your own work. This is why companies pay a premium for office space in vibrant areas, why retail thrives in lively environments, and why people prefer communities that offer more than a place to live. If a company attracts or keeps better talent because of the neighborhood its in, or if a retail street sees increased foot traffic because of a carefully curated mix of tenants and public spaces, the economic impact of these factors isn’t always obvious at first. But to every CEO, CHRO, or owner, their significance grows over time. Many employers that ignored these factorswhether by relocating or staying in the wrong placelater dealt with talent flight, engagement drop, and operational struggles. In retrospect, the consequences were clear. It is no coincidence that many of the worlds most valuable companies were born in Silicon Valley, which is an exceptionally livable and well-balanced environment. The repercussions of the areas rapid economic growth have since put pressure on some livability aspects, but the livable foundation was a key ingredient to its success. Against this background, weve developed our own index to capture a wider set of critical livability values. The index not only measures factors like safety and accessibility, but also social interaction and cultural vibrancy. Over the past few years, weve significantly advanced our own index score measured across our developments. Since we are a listed company, this score is regularly reported to the stock market, alongside our financial and decarbonization reporting. However, the index is not just a reporting measureit is directly linked to our sustainability bonds, integrating these intangible values into our financial structure. The more we improve livability, the lower our cost of capital. Its a way of quantifying what the market increasingly understands: Places that cultivate interaction, well-being, and identity hold lasting value. Well-being as a shared value One of the most overlooked aspects of value, crazily enough, is well-being. Urban loneliness is rising. Stress levels are rising. The way we design and activate spaces in real life can either worsen these problems or help solve them. The platform mindset is crucial here: Isolation is the biggest obstacle to well-being, which relies on interaction, a core function of platforms. The best urban areas are those where people feel connectedto their neighbors, to culture, to work, and to nature. This is why we emphasize not just physical design but the social and emotional experience of a place. That includes shared green spaces and foodsome would argue this matters mostto diverse retail, health, and leisure offerings. Developing a place which shapes peoples daily lives comes with great social and economic responsibility, affecting their health, creativity, and sense of belonging. How urban development must evolve in the platform era As the economy continues to shift toward intangible value, championed by platforms, the best real estate developers will understand their role not just as builders or operators, but as city life shapers. This means embracing new objectives, new partnerships, and a new mindsetone that sees urban areas and individual buildings as centers for interaction rather than just physical assets. Urban planners and architects play important roles, but developers are the economic engines defining both projects and functionality over time. Still, compared to architecture, real estate often lacks an innovation mindsetsomething that has real consequences. We need platform companies in the physical world to be as ambitious as platforms in th virtual one, otherwise it will lose its relative appeal. Relying solely on digital platforms to shape how people live and interact is hardly a sustainable model. To create conditions for greater well-being, we need to strengthen the real-world layer that digital platforms cant replace. The real-world city naturally exposes us to spontaneous encounters and experiences, sparking creativity in ways algorithms cannot replicate. It engages our innate reward systems through meaningful interactions, making cities uniquely capable of driving both innovation and human well-beingwhether or not we actively seek it. This is precisely what digital platforms, with their self-reinforcing bubbles, struggle to achieve. It is also why the city remains humanity’s greatest invention, effortlessly breaking through our mental echo chambers to prove its value as our ultimate interactive platform. Real estate clearly has a void to fill, as the industry isnt fully delivering on the promise of cities as platforms. To change this, we must learn from the most successful platform companies today. They can teach us a lot about structural efficiency and capacity to shape behavior and economic activity. Digital platforms are not role models in every aspect, but they have certainly demonstrated how to challenge the status quo, link people and companies in new ways, and generate economic value on an unmatched scale. These are all needs in the physical world. There is a clear opportunity for the real estate industry to apply platform principlesand every reason for us to do it. Linus Kjellberg is the head of business development for Atrium Ljungberg. The Fast Company Impact Council is a private membership community of influential leaders, experts, executives, and entrepreneurs who share their insights with our audience. Members pay annual membership dues for access to peer learning and thought leadership opportunities, events and more.
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Ive always been vocal about the need to fight inequality in our own backyards. As a resident of New Yorks Capital Region, I built my marketing business here. And in 2020, I founded Business for Good Foundation, a nonprofit philanthropy organization focused on closing the growing wealth gap and providing a hand up to underserved entrepreneurs. The inequality is blatantly real. The 23.3% poverty rate is more than twice as high in Albany versus the 11.1% national average. In fact, New York is one of the most economically unequal states in the country. While local and state government have made promises to help clean up the city, reduce crime rates, and create more affordable housing, the reality is that we havent seen much movement and things arent getting better. If we truly hope to level the playing field and tackle these inequities, then those of us driving change in the private sector will simply need to keep our eyes on the ball, and step in where government officials are not. The growing wealth divide in the U.S. While those in political power might not always care to acknowledge it, income inequality remains one of the greatest challenges facing our country, to the point that the U.S. continues to boast a significantly larger wealth gap between the rich and poor than any other developed nation in the world. To put the issue into perspective, according to the Peter G. Petersen Foundation, the income of the 20% of wealthiest U.S. households rose 165% between 1981 and 2021, whereas middle and low income households have only seen growth of 33% and 38%, respectively. And if our political leaders arent even willing to recognize, much less take action to address the nations growing wealth divide, then making a real impact will require the collective effort, dedication, and resources of private advocacy groups and philanthropists in our communities. The compounding threat of housing inequality Sadly, for the millions of people living in underserved communities across the nation, overcoming income insecurity isnt about striving for the American dream, but rather ensuring they can feed their families and keep a roof over their heads. And as the U.S. economy continues to grapple with an ongoing housing shortage and affordability crisis, this growing sense of anxiety and desperation has the very real potential to result in further increases in poverty, crime and social unrest. The state of housing affordability in America today is frankly appalling. According to the National Low Income Housing Coalition, there is currently an estimated shortage of over 7 million affordable homes in the U.S., not even close to enough to accommodate the nearly 11 million extremely low income families throughout the country. Ive witnessed this devastating reality firsthand while living in the Capital Region. To address these issues, Albany announced an executive budget proposal earlier this year that would include a $400 million investment toward revitalizing the community. However, Albanys government has once again been slow to act, and the commitment has not been seen through, further underscoring the need for community and business leaders to work together to drive meaningful change, with or without state or federal institutional support. Relying on the private sector As someone whos been lucky enough to have a successful career as an entrepreneur, and who recognizes how the unfair advantages provided to certain groups prevent others from getting ahead, Ive frequently struggled to understand the states unwillingness to step in and put an end to the widespread inequalities that have been plaguing this country for so long. This is exactly the issue I set out to address when I founded the Business for Good Foundation. And if theres one thing Ive learned in my experience, its that providing those who are less fortunate with equal access to resources and opportunities is often all it takes to uplift an entire community. Going forward, I wont simply sit on my hands any longer and wait for state leaders support to do whats right. Instead, I plan to double down on our work in New Yorks Capital Region through a heightened focus on fostering business growth, economic inclusion, housing stability, and community development to build a better, more equitable world for all. Its my hope that other business leaders across the private sector will do the same. Ed Mitzen is cofounder of Business for Good. The Fast Company Impact Council is a private membership community of influential leaders, experts, executives, and entrepreneurs who share their insights with our audience. Members pay annual membership dues for access to peer learning and thought leadership opportunities, events and more.
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E-Commerce
As the new term of the Trump administration gets settled, the United States economy sits at a crossroads. With hundreds of billions invested in the energy transition by the previous administration, aimed towards long-term economic and energy security, the stage is set for the United States to take the next step in maintaining its status as the world leader in sustainable technology. Internationally, countries are jockeying to control this trillion dollar market, and while China has an early manufacturing lead, the U.S. industrial and tech sectors can prove to be a decision maker. By focusing on market-driven solutions and domestic resource development, the Trump administration can accelerate what the Biden administration did for the green economy by expediting permits and loosening regulatory approvals, while further strengthening national security and creating high-paying jobs. Critical minerals America’s transition to clean energy requires a robust domestic supply of critical minerals, with lithium playing a central role in our energy future. The U.S. possesses significant lithium reserves, particularly in Nevada, California, Texas, and Arkansas, that remain largely untapped. As Trumps ally Elon Musk has pointed out several times, investing in lithium refining is a license to printing money, and contributes directly to the energy and automotive industry through the production of lithium-ion batteries. The United States must maintain a strong presence in critical economic sectors. With EVs being the primary driver of battery demand, the shift toward EVs poses a challenge to the U.S. automotive industry, a key pillar of the nation’s economy. Over a million Americans are employed in motor vehicle and parts manufacturing, an industry that also plays a fundamental role in the country’s metalworking expertise. This underscores the importance of the ongoing U.S. steel saga and why keeping these industries under American control makes the economy stronger. As other nations scramble to source their own supply of lithium and other critical minerals for the transition, we have the opportunity to reduce dependence on foreign entities and empower U.S. businesses. Embrace the transition Electrical vehicle (EV) adoption is a win-win for the U.S. The link between dependence on foreign oil and economic recessions plagued Americans in 2022 with high gas prices. While the benefits of EVs and renewable energy are very clear in the context of shifting global economic priorities, America needs to fully commit to it lest it find itself too far behind to compete. This means significantly ramping up our current production. To enhance the scale of domestic EV supply chains, the U.S. military aims to create a dedicated market for American companies by utilizing next-generation batteries in a select group of military vehicles, drones, and equipmentexcluding current lithium-ion technologies and Chinese suppliers. Likewise, these initiatives could extend to other government agencies procuring batteries, such as the U.S. Postal Service fleet and the 28 other federal agencies that have pledged to increase EV adoption. This would go a long way in creating a fast and efficient supply chain for consumer-facing products. Supporting this could be government-led policies and public-private projects connecting domestic mining operations with local electric vehicles and renewable energy manufacturing further integrating supply chains which will benefit the rural areas in which lithium and other minerals are found. High paying jobs, upskilling opportunities, and the economic development of towns and cities are the direct benefits before we begin to consider the accepted financial gains that everyday Americans will make once the EV and renewable energy sector are implemented at scale. What is next? By reducing barriers to private sector investment, streamlining regulations, and supporting domestic resource development, the Trump administration can lead in developing clean energy solutions that benefit the economy and the environment. Environmental stewardship and economic growth are not mutually exclusive, but rather complementary goals that can be achieved through smart, market-driven policies. The U.S. can be the first green global economy, or we can continue being dependent on foreign interests, selling off American assets like U.S. steel, and trusting foreign powers to run supply chains critical to our national security: This is the crossroads we currently sit at. All indications point towards this second iteration of the Trump administration being good for U.S. businesses for the sake of a strong American economy, this means committing to the transition that entire industries have been prepping for since he last took office. Teague Egan is CEO of EnergyX. The Fast Company Impact Council is a private membership community of influential leaders, experts, executives, and entrepreneurs who share their insights with our audience. Members pay annual membership dues for access to peer learning and thought leadership opportunities, events and more.
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