Technology is changing the world faster than ever, and Commercial Real Estate (CRE) is no exception! To understand the change that will impact the way we occupy, lease, use, manage and interact with CRE, the following 6 technology trends are important to watch:
1 - Artificial Intelligence (AI)
AI is the next generation tool that will take care of ongoing prospecting, lead generating and old fashion customer service. By using AI, 24/7 provision of instant information will be guaranteed, at a lower price. It is important to highlight that AI, Internet of Things (IoT) and Big Data will go hands in hand with changing CRE industry. To provide a simple example of such blending; the IoT can show a compressor's energy usage. Big Data can pinpoint that the energy usage is higher than usual and that this trend usually correlates with a failing unit. AI can automatically dispatch a technician and have the right parts for a repair ordered and on site before he or she gets there.
2- Internet of Things (IoT)
The Internet of Things refers to a vast array of computing devices that, when embedded in everyday objects, communicate autonomously with each other and with us. IoT applications aim to grow margins and enable features such as dramatically more efficient building operations, enhanced tenant relationships, and new revenue generation opportunities. The CRE industry is perhaps uniquely positioned to implement technologies such as using IoT-enabled Building Management Systems (BMS) to make building performance more efficient and also use sensor-generated data to enhance building user experience.
3- Big Data
The power of the IoT comes not from the sensors, but from the ability to collect and analyze the data that they generate. The commercial real estate is a $12 trillion industry and the ability to make better data-driven decisions can save time and money for almost everyone involved. Real estate professionals can utilize big data to make strategic decisions rather than having to make decisions based on hunches or best practices.
4- Augmented and Virtual Reality (AR & VR)
Use of AR & VR will provide more robust solutions to come to market to allow clients to truly experience a property without setting foot into a physical space. This will lead to less time wasted touring properties and faster closes. This technology can also be used to form new marketing strategies by CRE companies. VR can also impact office design and business travel by enabling companies to choose to use virtual meeting scenarios. Added to that, VR can revolutionize building management and maintenance by enabling techs to see the status of systems as they walk through buildings
5- Drones
Like offering pictures of properties in marketing, a drone video is something that tenants and purchasers can demand to help them gain a quick and better overview of properties. These videos will allow users to get innovative angles and get a better sense of the scale of a building. Drones can also be used for 3D modeling an entire building and feed information into computer programs and databases.
6 – Blockchain
Blockchain will disrupt the financial aspect of real estate. Not digital currency, necessarily, but blockchain technology will help CRE to answer utterly important questions of where the money is, where it came from, who really controls it, who owns it, where is it stored, and when it gets passed off. If property transactions have a trusted source on the finance side—a source that is not a traditional institution but perhaps a high tech company that automates much of the protocols—deals could be completed at quickest speeds. And with smart contracts and electronic signatures in place, the potential for fraud will practically be eliminated. Blockchain technology will also improve the process of recording ownership in the land registry.
The above disruptions will inevitably affect current systems, databases, networks as well as staff in CRE and related industries. However, the key to surviving and thriving in this new order is to adapt and innovate to withstand possible volatility and drive growth.
Source: Elnaz Ghafoori, M.Plan, Ph.D Commercial Real Estate Research & Analytics
