The increasing adoption of robotics in China's real estate

Robotics industry embraces its golden age

The International Federation of Robotics (IFR) reports that the global robotics market was valued at USD 59.7 billion in 2022. It is projected to grow exponentially, reaching USD 202 billion by 2030, with a compound annual growth rate (CAGR) of 16.1%. China is a major player in global robotics. Since 2017, China's robotics market has expanded significantly, growing from USD 6.4 billion to USD 17.4 billion in 2022. It is expected to reach USD 25.1 billion by the end of this year, with a CAGR of 20%. This remarkable growth is driven by a number of factors such as advancements in AI, increasing demand due to demographic shifts and rising labour costs, supportive government policies such as the "Made in China 2025" plan, as well as cost-effective supply chains. In combination, these factors have propelled China's robotics industry forward at an accelerated pace.

The rise of robotics drives revolution in real estate

Robotics has emerged as a transformative force in various industries, including real estate. These technologies are fundamentally reshaping the way we design, build, and manage real estate assets. According to JLL China proptech database, over 100 domestic robotic companies have operations relating to the real estate industry. Approximately half of these companies develop service robots, offering a diverse range of applications from cleaning and sanitation to security patrols and EV charging. Industrial robots are increasingly utilised in construction processes and warehouses to enhance efficiency, precision, quality, and safety. Specialised robots are in high demand for high-rise window cleaning and security. Additionally, humanoid robots, which can mimic human actions, offer vast potential in real estate applications and have attracted significant venture capital interest.

However, despite the widespread application and growing popularity of robotics in real estate, the overall level of autonomy still needs improvement. While robotics excel at performing simple and clear tasks, they often require human assistance in complex and unstructured environments. This highlights the need for a balanced approach that combines the strengths of both humans and robots to achieve the best results in real estate.

Figure 1: Breakdown of robotics companies operating in real estate by types

Source: JLL China Proptech Database, 2024

Figure 2: Key scenarios of robots in real estate

* The size of ⚪ represents the number of companies producing this type of robot.
Source: JLL China Proptech Database, 2024

Opportunities and challenges: a case study of commercial cleaning robots

The growing labour shortage within the cleaning industry has propelled the adoption of robots. Test results demonstrate that leading commercial cleaning robots can achieve work efficiencies up to five times greater than manual labour. Moreover, the implementation of the Robots-as-a-Service (RaaS) model has made the monthly rental costs of these robots comparable to or even lower than the average monthly salary of cleaners in major cities.

However, robots do not always perform as expected in real-world scenarios. Factors such as safety concerns, traditional procurement methods, and the lack of standardised regulations and skilled personnel collectively impact the widespread adoption of cleaning robots in the commercial real estate sector. This indicates that integrating robots is not just a straightforward replacement but rather a comprehensive and strategic transformation that requires the collective effort of the entire industry, from upstream suppliers to downstream users.