Source: analyticsinsight.net
Historically, commercial real estate (CRE) intelligence has been passed down from person to person, either through a brokerage company or a corporate structure. While this seems to be working, for now, the future that we can foresee for the CRE industry includes a combination of this human intelligence and technology-based systems. The blending of these knowledge-based systems is currently being driven by the use of artificial intelligence (AI) systems such as machine learning (ML) and natural language processing (NLP). AI-based systems, when combined with human intelligence, can help propel our business of real estate development and advisory.
Moreover, according to a Deloitte report, it has become urgent for CRE companies to prioritize tenants’ and end-users’ needs, given the increasing influence of technology and changing customer preference. Deloitte’s 2020 outlook for the CRE industry surveyed 750 CRE executives in 10 countries to assess how and to what extent emerging technologies and analytics are helping leaders make informed location decisions and create more memorable tenant experience. The survey noted that:
1. Tenant preferences are changing due to increasing urbanization and globalization, changing workforce demands, such as flexible location and workspaces, and technology advancements such as AI and the Internet of Things (IoT).
2. Most respondents rated tenant experience as a top priority. Yet, for a majority, digital tenant experience is not a core competency.
3. Executives acknowledge that the benefits of IoT and AI technologies are not limited to tenant experience. They also can raise operational efficiency and lower costs.
Elements of Digitized CRE Industry
IoT & Mobile Apps
Respondents believe that IoT technology and mobile apps are important elements in enhancing tenant/end-user experience. More than one-half of the respondents believe that environmental and security technology investments will improve the tenant experience. They also believe that tenants are looking for innovative features in smart or IoT enabled buildings.
For example, Singapore’s Nanyang Technological University (NTU) is one of the most connected and sustainable university campuses in Asia. Its 250-hectare Eco-campus comprises more than 200 GreenMark Platinum-certified buildings. Since 2011, NTU has added smart building features such as lighting sensors. Smart plugs and other technologies, lowering energy usage by 26 percent. NTU now aims to achieve 35 percent energy, water and waste reduction by 2020.
Value of Data
Data generation and usage will only rise in the future. With it, data control and access will become more complex, which means that data governance is a growing imperative for CRE leaders.
Many CRE companies haven’t truly felt the need to organize and manage data because they currently aren’t fully capturing and leveraging their own data. In addition, some companies that are purchasing data from vendors are unaware of the best way to handle it. To maximize the value of data they already have, whether collected internally or purchased from a vendor, CRE companies would have to develop platforms processes and a governance structure that enables data discovery, availability, management and usability.
Artificial Intelligence
AI has the potential to create a positive impact on the entire CRE organization, by helping capture, manage and leverage data more effectively. It can reshape tenant experience by increasing the ease and frequency of interactions with both tenants and end-users, add more agility in core business processes and drive operational efficiency. The technology’s predictive capabilities for any and every business decision can have a strong influence on profitability and returns.
CRE organizations should leverage AI technologies to analyze new and complex forms of data and automate redundant tasks. This can help organizations enhance their predictive capabilities to make smarter tenant-related decisions and modernize leases.
