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MC: OK. Welcome back. Wouldn't matter how many times that bells's rung, would it? There's
still a few coming in. Um, it's not veyr often that I , um, get the opportunity of making
an introduction to someone who has been a personal friend of mine for just about a quarter
of a century -- we were child brides of course. When we were putting our speakers' invitations
together, we obviously wanted to have an extremely high profile Australian keynote speaker and
our wishlist started with one name and, fortunately, we never had to go to number two or three.
Peter Verwer is the Chief Executive of the Property Council of Australia. It is the nation's
leading advocate for the six hundred and seventy billion dollar investment property industry.
As well as pursuing its core business of advocacy and public affairs, the Property Council operates
learning, research, publishing and networking businesses. Peter's current political priorities
are tax modernisation, sustainability, finance and regulatory reform. Peter is a member of
many public and private sector bodies here in Australia. Now I'm going to list some of
them, and I can assure you this is not the full, exhaustive list: He's the Chair of Liverpool
Housing, Australia; He is the Chair of Construction Forecasting Council; He is the Chair of the
National Counter-Terrorism Business Advisory Group; he sits on the Australian Statistics
Advisory Council; He sits on the Australian Construction Industry Forum -- I presume he's
an insomniac; He sits on the Austraian Sustainable Building Environment Council; on the Business
Coalition for tax reform; the Green Building Council of Australia; and Investment Property
Data Bank; The Property Council, just in his spare time when he's running that, he employs
97 people right across Asutralia and generates revenues of 26 million dollars. The Federal
Government has appointed Peter one of six Disability Community Leaders. He's also a
life fellow of the Green Building Council, an honorary fellow of the Australian Institute
of Quantity Surveyors, and a fellow of the Royal Institution of Chartered Surveyors.
It is wil enormous pleasure that I introduce Mr Peter Verwer.
Peter Verwer: Thank you, John, for that very generous obituary. In case you didn't know,
we're in the session called 'Delivering the Urban Century' because the organisers wanted
me to give a big picture view of some of the key themes of this event. I'd like to start
off by giving you the thesis so you can disagree with me straight away. And that is that we're
living in an age of urban acceleration, that the globe has nev er seen this scale or extent
of urbanisation. And that's almosta given these days and you can see it from this nighttime
map of the world. We also live in an epoch of acceleration global innovation driven by
the rapid proliferation of communication technology in a connected way and connecting up the planet.
And it's my thesis that it's the intersection of these drivers which are accelerators -- the
urbanisation, the information technology innovation in a globalised way which is a cause of tremendous
optimism about the future. And this is particularly relevant for the people in the room because
you are the stewards of the built environment or what I like to call 'the human environment'.
That is to say that you design and you deliver and you manage the built environment. In fact,
you are a key think-tank, this entity is a key think-tank in relation to how we can become
far more innovative and how we can unleash prosperity on the planet.
One of the emerging ideas of the last decade has been about urban economics -- a topic
shunned by most economists for over a century, ignoring the works of Alfred Marshall. And
it's the intersection of these three factors which are on your screen which provide for
us an opportunity to build in an exponential way prosperity by making an investment in
urban economics. And the reason that's so important to the people in the room is that
you are pretty much in charge of that. You are in charge of the opportunity to better
design and build the kit of the built environment, connecting up the buildings to the precincts
to the cities to the metropolises to the regions, and by doing so, super-charge productivity
and thereby underpin prosperity. Urban economists now say that the potential,
the dividend from designing, investing in cities, designing them better and managing
them better is about 2 to 8 percent lift in GDP. Which is an enormous amount. A recent
study in the UK showed that just a 10 percent increase in econ-activity -- what economists
call 'agglomeration', so really, the extent to which businesses and people can transfer
ideas and work with each other. A 10 percent lift in agglomeration in connectivity actually
provides a one and a quarter percent bump in GDP, so the GDP on the economic activity
which actually fund, underpin live-ability. So, in many ways, that opportunity is in your
hands, because you're at the crossroads of the built environment, the virtual environment,
the political environment, the public policy environment. And the people that the Property
Council represents are the investors in that arena.
And the other key factor in thinking about this opportunity is that 60 percent of the
built environment that ewe're going to need by 2050 -- 60 percent, as according to the
World Bank -- doesn't exist yet. No, we'll hear from one pof our speakers later who wants
to talk about what do we do with the existing stock? We've got a lot to build, but we've
also got assets which we may need to make work harder and how do we do that? In Australia,
for instance, there's 360 million square metres of built stock which is more than 25 year
old, 25 years old. And that doesn't include houses. How do we make that stock sweat harder
and work harder for us? How do we unleash productivity from that, as well as build cities
which don't yet exist? So I'm going to make four points about this
unleashing that can occur from the intersection of the drivers. Firstly, that there is the
opportunity to provide, to accelerate community wellbeing. So when I talk about productivity,
I am principally referring to economic productivity, and economic activity, but I also mean the
unleashing of social capital as well. So we can raise wellbeing, we can boost productivity,
but the fundamental thesis of this presentation is also that cities will save the planet.
That better designing our cities, not just as individual components that don't talk to
each other, but in an integrated way and ask the panel what that means. Because there are
two words which really scare me: 'integration', which is becoming sort of a mantra, "if we
just take an integrated design approach to things, then we're going to get better buildings";
and the other one is 'holistic'. These two words are probably going to be used more than
ten thousand times during this congress, and tghen they'll be followed by this 'but': "but
why people, why don't people actually understand and why don't peple change their practices?"
And what we're going to explore in the panel is to look at the barriers to these blockages
which block urban productivity and therefore improvements in productivity. But one of the
great dividends of getting that right is that cities will be completely redesigned in a
way which is actually planet-friendly -- high performance, green buildings, whereas one
of the people I'm going to cite, a sort of blue technology. And fourthly, and probably
most interestingly, is that this urbanised, massively, intensively connected planet is
also one taht radically changes the nature of civic society. That is to say that individuals
will be more empowered, they'll have greater control over their lives, and they'll be able
to make the most in a way which has never occurred before in society of their own talents
and experiences and aspirations. So the issue then becomes, are our political
systems, our public policy systems, our business models fit for purpose of this challenge?
To which the answer is 'no'. The bigger questions is, how can we shift them, so that we can
take hold of this potential unleashing of a globalised, urbanised, connected world?
So technology and aspiration are currently running ahead of our institutional arrangements
within society. And this is particularly the case, I put to you, in our area, in the built
environment area, we already heard a sort of a cry for help this morning: "Why don't
the various stakeholders understand the opportunities that technologies provide and simply apply
them?" And the answer is, I think, that because they're not well sold, because the language,
moving from a language of technology to a language of business is something which is
very poorly done. So let's take a look at these accelerators
and we'll bring our panel up for the hard stuff, and I really encourage a lot of questions.
So we want to be as controversial as possible, we want to have a full and frankn debate.
I'm not talking about a Jerry Springer-style event, but as soon as you've got a question,
you go up to those microphones -- after my speech -- then what we'll do is get you involved
in the fray here. So let's just look a bit more at what urbanisation
really means. These are just the covers of two books put together by the Urban Age Project
-- a fantastic endeavour run by the London School of Economics. And they make clear,
the nature of this radical change. 1900 -- there were only 10 percent of pepole in cities.
By 2007, it was 50 percent. It's currently just on about 53, 54 percent. But more miportantly,
what we're going to see by 2050 is that 75 percent will live in cities, that people will
live close to each other, and the question is: will they live in smart cities or will
they live in dumb cities? Will there be smart growth or will there be dumb growth?
There's only one graph in this entire presentation and I've made it as big as possible, but these
are important numbers because in 1950, 40 percent of the urbanised world was in the
so-called developing countries and if you look at the top of the bar chart, that's going
to be double, going to be nearly double in 2030 -- 80 percent of people will live in
these urban nations. So if we get it wrong, we are going to get it massively wrong as
well, but it's also why the opportunity is so fierce.
For rockstar economists like Ed Glacer, he says that cities are the greatest invention
of humanity and indeed he goes on to say that this invention makes us smarter, greener,
healthier and happier. I mean, you had us a 'hello' on that one. And his main argument,
really, is the one about urban productivity. What draws people to cities is a very smart
calculus. It's a diversification strategy, firstly. They know that they've got multiple
opporunities to gain access to capital. They have multiple opportunities to find friends,
life partners. Multiple opportunities to come close to their customers. And if all of that
fails, then they can try again, because they're in a diverse, myriad environment. He also
says that there's a central paradox to the modern metropolis and that is: as the cost
of connecting across cities, across countries declines, then the value of being close increases.
And that's an argument to make sure that the places that comprise cities are themselves
unleashing of aspiration, culture, and that people's sights are raised.
I want to talk a bit about digital technology and I'm going to make three points here. The
first is that information is intrinsically global now and , you know, this is a classic
Facebook map. So these are the localities of friendships. These are the social connectivities
of Facebook friends. Who here is on Facebook? Who here is on the boring person's Facebook,
LinkedIn? OK. It'll be interesting to see the LinkedIn map here. And this isn't the
Facebook connectivity that has been overlayed on a map of the world -- this is the actual
links between Facebook friends using GPS. Notice it forms the world. And this would
be even starker if we added in Q-Zone with China, which is the Facebook of China, which
has 552 million people, and the Kontact in Russia which has another 192 million people.
But the whole point here is that the acceleration of this connectivity will unleash more and
more innovation when instead of just having about 2 million people connecting to each
other, often at very poor speeds, we have 7 billion and ultimately 9 billion. And this
radically changes the nature of society. Radically changes it. The Nobel Laureatte Robert Lucas
Junior said that we're entering into a new class-based society, and the new class of
people -- those who are ideas generating and problem-solving. In other words, we're moving
thinking and problem-solving away from the cottage industry that it has been for several
centuries, and this is radically more different than the invention of the two-way telephone
in 1876 or even the early internet of the 1990s, because these are people who are being
given the tools to actually share their ideas. Now, if we go to a couple of other thinkers
who I think are worth having a look at, so the Executive Chairman of Google and the Director
of Google ideas Eric Schmidt and Jared Cohen. They say, in this excellent book 'The New
Digital Age', that we are... Just to underline the point because we are, I think people are
starting to take urbanisation for granted and they're taking technological change for
granted -- but they are saying that we are facing a brave new world, the most fast-paced
and exciting in human history; we experience more change at a quicker rate than any previous
generation and this change driven in part buy the devices in our own hands will be more
personal and participatory than we can imagine. They give the example of a Congalese fisherwoman
so it's not just about the sorts of mega-projects we'll be talking about at this congress, but
the idea that you can unleash another mind and that peoploe can create their own networks
and that you can get a six-degree-of-separation planet down to two degrees of commerce and
cultural interaction I think is displayed by this simple anecdote they provided about
a Congalese fisherwoman. So Congalese women tended to put their fishing lines in, they
got their catch for the day, they put it all in one place, they guessed how much was needed,
they out it into expensive refrigeration units using energy very inefficiently, they often
needed to have security, a guard, so the catch wasn't taken. Now, not using the technology
in this room but very basic mobile technology, these Congalese fisherwomen have created a
totally new economic system for themselves. Firstly, they leave the fish on the lines
in the river, they wait for the orders to come in whicjh theuy tote up, they then pull
in the fish that are needed, thereby insurinf that they're fresh, and they also connect
up -- that is to say, create economic co-ops with other villages to ensure that what they're
doing is supplying the needs of the customers. So this is, (a) more efficient from an environmental
perspective, it's more energy efficient, it means that there's less food poisoning, that
the fish are better, and that these women create an economic microsystem which is more
efficient. And they're doing that with a telephone. They're doing it with a telephone. They're
not even using an app. The app will be created. So the conclusion of the Google boys is that
evolution is building on its own increasing order. And this is my point about whe you
have multiple accelerations then you're going to get greater returns faster over time.
So lets look at another aspect of this technology. I'm not going to go into this in huge detail
because there's a large number of quite good presentations on artificial intelligence,
machine thinking, telematics, robotics at this conference. But the gap between the sort
of technology that's available today and what we see with artificial intelligence and the
systems, for instance, machine thinking is already being used in Australia to make assessments
about the pipes that are being laid, water pipes under some of the cities. So instead
of taking an incredibly inefficient way of digging down, finding the pipe, haviong a
look at the, er, testing all the leaking, what they're doing is using machine logic
to determine when those pipes were laid, the sort of materials which were used for those
pipes, to monitor the leakage and therefore optimise the maintenance of those pipes. And
as you know, the invisible infrastructure in cities is as expensive to maintain, well,
it's a multiple of the original construction cost and it's usually very very poorly done.
This is something that artificial intelligence can remedy.
But the other issue about artificial intelligence is gaming. More money, I mean, there's more
technology in one 16-year-old's Xbox than there is in the entire planning system of
Australia. You know, if it was up to me, I'd take Australia's planning system with all
of its regulation, with all of its metrostrategies, which all basically paperbox, and I'd give
it to Pixar or the peaople who did Happy Feet. Because if you talk to a company like Urban
Circus, for instance, who create 3D models -- in fact 4D because they have time of all
of the cities -- and you apply that technology to something like community consultation,
instead of having time-wasting charrettes with lots of butchers paper, you can actually
ask people what they think about, you know, you can immerse them into multiple scenarios
about what their cities, their towns, their precincts should look like. And what they've
siad in Melbourne where they've tried this that it got the consultation period down from
9 months to 45 minutes. Because people could see it. They could see the alternatives. And
also when they've had quite feisty people at community consultations who didn't like
the idea of a massive bypass going through their home, they march into that room, into
that hall, and instead of having the biscuits and the brownies and all of the diagrams which
nobody can understand, they put them into a future scenario of what their locale would
look like. And firstly, you still have a whole bunch of people going, "You know what, I still
don't like it, but it's not as bad as I though it was" wasn't the horror, because it's the
visualisation of the future. This is what gaming technology provides. And you have a
whole bunch of other people say, "I've got some ideas about this. I've got some ideas
about how we could connect this up to the whole community". And that's a radical change.
And we saw in London during the Olympics that for not much money, not mega-sophisticated
telematics the sort of things you're talking about at this conference, they managed to
get what was a pretty poor system -- a legacy, infrastructure netowk -- to operate really
efficiently. And what was the secret of that wasn't just the technological smarts and the
connecting up, creating a common language of connectivity between a whole bunch of legacy
systems, was that they created a totally open-source system and that groups with information from
the public and private sector could actually share. And we see in Chicago now where the
mayor has committed to creating an open-source system and you look at the Chicago portal,
you can get everything from snow-clearing rates KPIs against KPIs through to information
about how the medical system operates from the sanitary stuff all the way to education
and health systems. And people take that information -- I had a look at it; it's pretty boring
-- but then people go and turn that into apps. That's what happens when you create an open-source
society and gaming technology is one part of that. You know, a game like Halo costs
about 30 million dollars to develop. 30 million dollars. I haven't seen 30 million dollars
allocated to planning improvements in Australia. All those people from other countries, you
can tell me whether your own governments invest more.
The science fiction part of this is also interesting. Once again, I won't spend a lot of time on
it because it's really happening now and there are several presentations that are going into
this, but photonics, nanotechnology, biomimicry. When you look at some of the stuff that's
happening now with micro-algae, bioadaptive mechanisms, whereby you have algae which can
become an insulator and can also be used to generate energy in nanopores, nanotubes, you
know, the stuff that works right now, there'll be some people in the audience going "Oh my
god, he is so far behind the times. We've already gone beyond that". But the idea of
creating cement and steel, which is stronger and less prone to cracking, the technologies
already exists and are really exciting. So the issue here really -- and I'll just
mention one more thing, and that is, the reason it seems to be a challenge is you take something
like BIM or Unitise Buidling if you look at that bottom picture there, that's the forte
building,it's a timber building, that's a ten-storey building in Melbourne. It was meant
to take 52 weeks. (Something) project from 52 weeks down to 40 weeks. But not only that,
it's a much safe site, and it's a greener building as well. In fact, I think the number
is, that is about 14 mega tons of abatement over the life cycle of that building. If you
look at the 338 metre Australia 108 structure that Katsalidis partners, Fender Katsalidis
are building at the moment, their reckoning is that they're going to be able to- because
they're using off-site structural assembly, they'll be able to get that thing up 30 to
40 percent faster with a 15 to 20 percent reduction in construction costs. My first
question to the panel is going to be: is it true that there's the potential to mainstream
a reduction in construction costs by about 30 percent while also maintaining high performance,
securing high performance building and safe worksites? People liek Katsalidis say this
can be done now. 3D printing are what the experts call additive
manufacturing. That top- that picture there -- that bike is printed. That is a printed
bike. Now that's a big printer. But what they've done is they've created a 3D bike. It doesn't
work but it is a replica and this is really what the Google boys are saying, which is
to say that by doing more in the virtual world, then the mechanical efficiency of the physical
world is massively improved. And that is to say that value creation is also super-charged.
So, the furture is already here, it's just not widely distributed. All of these ideas
have been tested -- and this is a quote from William Gibson -- and then we have these tentative-
and this is how science is already operating -- these tentative outreachings into society.
The accellerator that I talked about before of a massively, globally connected world,
where innovation is unleashed, means that we can speed up that old cottage industry
approach to getting innovation to market. And because we're actually talking about urban
technology, that happens at scale and therefore the benefits are massive across the planet.
One other thing on technology, this guy, Gunter Pauley, very interesting chap, we had him
out earlier this year. He doesn't like all this green stuff. He thinks green is old-fashioned.
Forget green -- he wants to go to blue. So what he's really saying is that the play-dough
of environmental advances that we've had over the last ten years, which have been huge.
I mean, there's no institutional building in Australia that's not 5 or 6 star. To do
that would be to build an obselete building. But what he's saying is that we can do much
much better than that. We can even do better than building 57 apartments in 11 days -- I
can show you a video about that later. We can do better than unitisation. What he wants
to do is, in ten years, still up 100 market-ready innovations that create 100 million jobs and
that it's all green. It's all zero carbon. So this guy is a Belgian economist and entrepreneur.
I mean, he's a real do-er. And in going beyond this sort of less-in but more-out ecoefficiency
creed, what he's really saying is that I don't want one coffee bean to be used in one-hundredth
of a cup of coffee. I want that coffee bean to be used for multiple purposes. And, in
fact, I want that coffee bean waste to be taken so that it can be used for bean farming.
And all of his innovations that he's talked about relate to energy production, mining
and banking and medicine, from making biodegradable detergents from citrus peels to converting
all of the existing petrol gas stations into battery-charging packs for electric cars.
My final point on technology is to say something obvious, I suppose, but it's ok because the
Greeks said it first and they used to get everything right. And that technology -- technae
-- is not just the tools; it's the know-how as well. That's what real technology is. And
my main point here is that infrastructure is technology and by better designing our
cities and investing in technology, remedying infrastructure deficits, what we're actually
doing is hard-wiring in a new circuit board. We're used to thinking of technology and infrastructure
as these big kits of roads and airports and harbourworks, but it's the micro-urban technology
that deals with pinch-points that connects up the education systems, the health systems,
the childcare systems to jobs that's probably the big new focus of the future. And that
we need fit-for-purpose planning systems to do that because the physical worlds and the
virtual worlds collide in our sphere, the built environment sphere, the human sphere.
So, there's a whole stack of quite difficult issues that this raises and praise the Lord
we have three people who can actually answer all of these questions. So I'm going to ask
Michael Roche, Graham Newton and Peter Bechalt to come up to the stage. Please, why don't
you give them a welcome.