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The disruptive might of artificial intelligence is headed for the commercial real estate industry, leaving monumental changes and creative destruction on its path. From financial modeling to building information systems, and predictive population analytics to augmented reality, this legacy sector is set for a reckoning, and stands to be completely overhauled over the course of this decade.
Like with most things pertaining to AI, it's hard to separate fact from fiction, and the prosaic understatements from gross exaggerations. However, it's not that hard to see what lies ahead for the commercial real estate sector, given its well known innate inefficiencies, and the proven capabilities of artificial intelligence across other sectors and use cases in recent years.
This sector in particular is perfectly poised to use AI, in order to reduce wastages, inefficiencies, and errors. Off the top of our heads, here are some advances that AI stands to usher in, with its impending collision course with real estate.
Sales & Marketing
Nearly two decades since the emergence of real estate portals such as Zillow, RedFin, and Trulia, the brokerage industry still siphons away over $226 billion in value each year within the US alone. While much of the blame falls on the regulatory regime that mandates the use of licensed realtors, with exorbitant fees set in stone, the broader industry’s reluctance to change hasn’t done any favors.
This decade will likely witness radical upheavals in the real estate sales and marketing segments, starting with the bloated brokerage industry. With chatbots, virtual reality, and personalized ad targeting, all coming of age, the value being added by an average broker no longer sizes up to the 5% cut they take from each transaction.
Decision Support Systems
Large commercial real estate investors have long relied on obscure metrics and predictions to ascertain the fair value of a piece of land, however, with big data analytics, and predictive insights, investment decisions can be supported using extensive traffic and population modeling.
This treads further onto the domain of brokers, who leveraged their understanding of local trends to get in on deals.
Property & Facilities Management
Building Information Management (BIM) systems have essentially spearheaded the digital transformation of architecture, engineering, and even construction management over the past few years.
Equipped with advanced AI, these systems can go a lot further, and eliminate substantial waste and inefficiencies in a commercial property development project.
These solutions can go a lot farther when it comes to property and facilities management, giving owners a birds-eye view of the functioning and operations of their properties, whilst also helping provide better services to tenants, and visitors.
Systems, Processes & Project Management
A key source of bloat, inefficiency, and wastage in commercial real estate companies is often the legacy systems and processes that have been in place for decades. The transformative power of AI, especially in regards to business process management and automation has long been raved about, and commercial real estate remains a prime testing ground for the same.
With tools such as Northspyre, particularly aimed at real estate developers, with a host of features for planning, budgeting, reporting, and analytics, a number of roles, processes, and systems can be rendered redundant. There are a number of up-and-coming solutions on the same lines, all aimed at the digital transformation of commercial real estate.
While the broader narrative surrounding artificial intelligence often paints a radical picture of earth shattering transformations, in reality, the pace of innovation is quite subtle.
Even though the rise of AI in commercial real estate will bring about monumental changes, it also stands to add substantial value to consumers, and shareholders, all the while creating new roles for every job that is made redundant.
AI Inspired Advances Offer The Ultimate In Commercial Real Estate Technology