Even if you’re fascinated by the huge variety of digital tools we have available in CRE, it can be hard to keep up with all of the trends and developments. There has been a deep change in the industry in recent years, thanks to new technology that makes us more effective and efficient. Digital tools facilitate everything from marketing to project management, and new ideas are constantly being stirred into the mix.
Certain technologies are proving to be significant for CRE, and will likely continue to influence our work in a major way. Today we’ll take a look at four tech topics that are on our radar, and some companies that are leading the way.
Possibly the year’s biggest CRE buzzword, “big data” is definitely a big idea. According to McKinsey, Big Data refers to “datasets whose size is beyond the ability of typical database software tools to capture, store, manage, and analyze.” In other words, you can’t really work with big data on your desktop using your own software, even if you had the time and inclination.
Where we get our data has changed in recent years. Sources now include networked devices, like traffic sensors, and unstructured data from social media, email, videos, and images. Combined with traditional sources and spreadsheets, big data are a powerful tool.
Companies provide data aggregation services that bring it all together and present the information in an understandable and usable format. Platforms like REIS provide nationwide and even global data. Their clients receive accurate analysis of vacancy rates, rent levels, cap rates, new construction, rent comparables, sales comparables, valuation estimates, and capital market trends across eight major commercial real estate sectors.
Other companies have a more narrow focus. Rentlytics specializes in business analytics for the multifamily market.
Sensors of various kinds are an increasingly important source of data for CRE. These can report around the clock with information on pedestrian or vehicle traffic around a property or neighborhood, as well as temperature, humidity, and lighting conditions in a specific building. New possibilities for this technology seem to come along every week.
Services are available that install, monitor and maintain the relatively inexpensive equipment required. Sites like Motionloft compiles the data so that clients have instant access to informative reports, in common formats like Excel and PDF.
Sensors can also enhance a building’s value, thanks to smart building technology. Energy savings and convenience make this big news in commercial properties. Building managers can more easily monitor systems, and tenants appreciate the convenience that smart technology provides.
Apps can be found to manage lighting, security, thermostats and more, from anywhere. Specific systems can also be monitored via sensors. For example, WallyHome’s sensor helps to detect water leaks. The related app lets the user set up text alerts and provide notifications of the temperature and humidity in sensor locations.
First of all, what is Artificial Intelligence, anyway? In simple terms, it is the ability for software to learn and adapt to consumer behavior via live feedback. Basically, it lets a machine improve its own performance by making automatic adjustments. It’s advancing at a blistering pace, and rapidly becoming more powerful and affordable.
What does this have to do with CRE? Russ Cofano recently suggested that AI might be the “21st century equivalent to the MLS utility.” That’s important. But, according to Cofano and others, like The Real Daily’s Sam DeBord, “intelligent” machines will not take the place of human interaction, mainly because, as DeBord writes, the intrinsic skills for CRE remain personalized intelligence (unique local knowledge, negotiation, transactional experience) and personal relationships (emotional IQ and sphere building).
They see the value of AI for CRE as an aid to improving business intelligence. Operating devices that “learn” from your behavior can create a database that informs us on best –and most effective- practices. Follow the intriguing conversation on Twitter at #AIinRE.
Drones have been around for several years, and their usefulness in aerial photography makes them a potential tool for CRE. Drone images can be especially useful in selling or developing large commercial properties. An aerial view is the only way to get a really clear picture of a large site and its relationship to surrounding structures and roadways.
Drone footage can be a terrific marketing tool and may often be what prompts a call from a potential client. But the FAA strictly controls the use of drones for business.
Regulations regarding drones are in flux, but as of today businesses must secure a waiver from the FAA to use drones. Most real estate firms find it simpler to hire drone operators who have already secured their waiver, but at least one agent has received permission to use drones for listing videos.
Late in 2015, the NAR released a guide for drone use in real estate that urges agents to comply with existing regulations. The FAA is expected to produce updated regulations sometime this summer, and when that does it’s likely that drones will really “take off”.