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The purpose of this paper is to increase the knowledge of real estate firms’ capabilities to innovate and, consequently, their capacity to absorb new innovations and benefit from digital technologies in an ecosystem context.

The results are based on 32 interviews with representatives of Swedish real estate owners, real estate owner industry associations and suppliers of digital technology to real estate owners. The data are interpreted using theories on absorptive capacity (i.e. the capacity to absorb new innovations), innovation capabilities and innovation ecosystems.

The real estate owners, technology suppliers and real estate owner industry associations have expanded their innovation capabilities and reshaped their innovation ecosystem by initiating a number of different digitalization activities; for example, the development of new IT systems, digital platforms, services and business models. The absorptive capacity has been improved as the organizations have changed routines and structures related to innovation, and they have taken on new roles related to digitalization and innovation, making them better able to absorb new innovations. Also, this paper identifies several drivers and obstacles to digitalization in the real estate sector.

The increased capabilities related to digitalization can lead to better absorptive capacity on an individual firm level, which can contribute to the overall development of these firms in a longer-term. Also, new capabilities may lead to better absorptive capacity in the real estate sector at large, as firms may benefit from each other’s capabilities through collaboration. The limitations are that this study does not interview tenants or facility management firms and that the findings represent the context of the Swedish real estate market.

This paper investigates innovation capabilities, absorptive capacity and innovation ecosystems of real estate owners, their technology suppliers and real estate owner industry associations on the organizational level and on the sector level, into which there is little previous research. Also, this paper highlights the novelty of digitalization as a phenomenon in the sector.

This article proposes a Multilayer Network (MLN) model for studying business ecosystems. The model focuses on the flows of products, services and money between buyers and sellers, emphasizing that these flows form both actor-level and emergent system-level ecosystem structures.

The article examines two case studies of real estate owners and their suppliers, using financial transaction data to provide a detailed, data-driven view of business ecosystems.

The study advances real estate theory by deepening research on the digitalization of real estate owners, especially on their enterprise architectures and supplier networks. Despite size differences, both case firms have similar, complex supplier-network structures. The findings may inform enterprise architecture management and procurement practices in the real estate sector.

The MLN model defines terminology for ecosystem layers and provides methods for establishing ecosystem boundaries. This aligns with the micro-level critique in management and ecosystems research. We conclude by highlighting that event data, when available, can enhance future business ecosystem analysis by enabling the study of broader ecosystem structures with the MLN model.