What is Extended Reality (XR)?
XR is an umbrella term for technologies that blend virtual elements with the physical world or create standalone immersive worlds, including existing technologies like augmented reality (AR) and virtual reality (VR), and future innovations.
An Example of a Real XR Ad on a NYC Building
A Futuristic Example of XR in Leasing
An Example of Unregulated XR
The Technology is Rapidly Changing
In today’s typical AR experience, a person uses a phone to view and interact with virtual elements being overlayed onto the physical world. AR glasses have been developed to make this interaction more seamless, and tech companies are rapidly working to improve the technology. Apple, Meta, Xreal, and Lenovo are already selling augmented reality devices, and Google, Samsung, and Qualcomm are also developing them with an estimated delivery in 2024.
Google and Adobe recently released a joint product to make it “easy” for “all creators” to associate XR content with privately owned real estate:
Adobe Aero Software
Google Glasses
Challenges Posed by XR
The laws governing XR technologies are not well-developed for commercial real estate. Virtual content is not physically located in or on a building, and the rules of engagement are not as well-defined as they are for traditional property rights.
As a result, XR content can cause real-world nuisance to property owners—crowds gathering without warning on private property, late-night visits, and questions over liability for gamers who are hurt on private property.
An advertiser can also create a revenue stream using your building without your awareness, much less approval. Outdoor advertising is expected to be disrupted by these technologies, especially as AI tools make it significantly easier to create digital media. Like game developers, AR creators can project virtual content “onto” or “inside” private buildings without any involvement by the property owner.
Potential Revenue Stream for a Property Owner
XR’s unique attributes offer new possibilities to engage with a building’s stakeholders—tenants, investors, guests, passersby, and more—including potential new revenue streams for commercial real estate. XR content can also have many layers at the same time, creating unlimited opportunities.
LEARN HOW TO PROTECT & BENEFIT YOUR PROPERTY
BOMA/Chicago has entered into an affinity agreement with Digital Rights Management (DRM), a U.S.-based XR registry, to offer favorable terms to its members who register Chicago properties.
Register Your Building
By registering a building, owners can easily publicize what permissions they give XR content creators with respect to their property. It serves notice against unwanted activity, and can also be used to realize revenue opportunities.
To register, submit your address, ownership, contact information, and if you are open to receiving licensing opportunities. Registration with DRM is free and can be canceled at any time. It is also non-exclusive—a building can register with DRM and be listed on other registries as well.
I do not want to permit any XR content on my building.
If an owner does not want to permit any XR content on a building, it can indicate this on its DRM registration. Doing so gives notice to content creators that they would incur legal risk to use the building in any content. While no registry can completely prevent unauthorized content from being projected “on” a building, responsible creators will heed the warning and seek out properties that are willing to host content.
I am open to XR licensing deals at my building.
If an owner is open to considering potential XR content at the building, it can elect in its registration to receive licensing offers from interested content creators. DRM will then act as a broker and bring interested buildings potential XR offers for owners to consider.
If a building decides to enter into such a license, that agreement would be negotiated and executed between the building and DRM. DRM’s template agreement for its brokerage service is located HERE. DRM earns a 5% brokerage fee based on the revenue earned; but BOMA/Chicago members receive a reduced brokerage fee of 4.5%.
Property Owner's Toolkit
Each property and investment strategy is unique, and owners and their managers should consult their legal and other advisors when making decisions about XR. This BOMA/Chicago toolkit notes several items that property owners and managers may want to consider when determining how to reduce the risks and maximize the opportunities posed by XR technologies:
The information in this toolkit was developed by BOMA/Chicago staff and reviewed by a task force of property management professionals. It is offered as background information and does not constitute legal advice. BOMA/Chicago expressly disclaims any liability for its use.