{"id":16814,"date":"2024-06-14T08:17:56","date_gmt":"2024-06-14T13:17:56","guid":{"rendered":"https:\/\/theamericangenius.com\/housing\/?p=16814"},"modified":"2024-06-14T13:18:05","modified_gmt":"2024-06-14T18:18:05","slug":"5-major-ways-ai-is-shifting-real-estate-scene-and-how-to-utilize-it","status":"publish","type":"post","link":"https:\/\/theamericangenius.com\/housing\/big-data\/5-major-ways-ai-is-shifting-real-estate-scene-and-how-to-utilize-it\/","title":{"rendered":"How to capitalize on AI as it shifts real estate"},"content":{"rendered":"

Forget about that location thing. Now real estate \u2013 especially commercial real estate \u2013 is about data, data, data. As in, Really. Big. Data. And AI is owed a large part of the credit for that.<\/em><\/p>\n

A dizzying amount of data is being crunched and sorted and searched by artificial intelligence-enabled tools that are changing how deals get done and who will still have a job in the future.<\/p>\n

The promise of AI to use data to predict the future is massive \u2013 and it promises to do that with more accuracy and efficiency, greater productivity, and less cost for commercial as well as residential real estate.<\/p>\n

So, what, exactly, can AI do for commercial real estate? Let\u2019s break it down.<\/p>\n

First up, what AI is (in this context)<\/strong><\/p>\n

To put it simply, artificial intelligence<\/a> is what lets Amazon\u2019s Alexa talk to you and cars drive themselves.<\/p>\n

Its algorithms use data to mimic human intelligence, including learning and reasoning. Then there\u2019s machine learning<\/a>, where algorithms analyze enormous amounts of data to make predictions and assist with decision-making. We\u2019re putting them both under the same AI umbrella.<\/p>\n

There are four main areas where AI is remaking the commercial real estate industry: development and investing; sales and leasing; marketing; and property management.<\/p>\n

1. Development and investing<\/strong><\/p>\n

With its ability to quickly analyze a staggering amount of data, AI lets investors and developers make better data-driven decisions. More responsive financial modeling<\/a> helps identify ideal use cases and project ROI under multiple scenarios using real-time data. Pulling in alternative data \u2013 say, environmental changes or infrastructure improvements \u2013 goes beyond traditional data points and can identify investment opportunities, such as neighborhoods beginning to gentrify.<\/p>\n

AI\u2019s crystal ball comes from recognizing patterns in the data and continuing to learn from new information. It can forecast risk, market fluctuations, property values, demographic trends, occupancy rates, and other considerations that can make or break a deal.<\/p>\n

And it does all of this more efficiently, more accurately, and less expensively than manual methods.<\/p>\n

2. Sales and leasing<\/strong><\/p>\n

There\u2019s a big question looming over AI and automation: Will technology put real estate brokers out of business?<\/a> The short answer is, \u201cNo, but brokers need to step up their tech game<\/a>.\u201d<\/p>\n

Keeping up with \u2013 and being open to \u2013 tech trends is essential. Client’s ability to use online marketplaces to search for or list property will only grow, but there still is no substitute for the expertise and the personal rapport that builds trust. Chatbots can\u2019t negotiate, yet. Robots can\u2019t show space and weave details about the property into a story.<\/p>\n

If you want to know more about using storytelling in real estate, check out this great marketing guide<\/a>.<\/em><\/p>\n

But Big Data is such a powerful tool that brokers need to know how to harness it for themselves. Having more, and more nuanced, data about clients and properties means brokers can better match the two. They can be more confident in setting sales prices and rental rates. Becoming a \u201ctechnology strategist\u201d to help clients design an automation strategy for a property would be a great value add to their services. Even just starting out with a website chatbot to answer common questions would add a level of tech-savvy efficiency to communication with clients and prospects.<\/p>\n

3. Marketing<\/strong><\/p>\n

Also a boon of Big Data for brokers: more sophisticated, targeted marketing for themselves, as well as for client properties.<\/p>\n

Integrating AI with customer relationship management (CRM) tools brings a richer understanding of clients and prospects that can make choosing marketing channels and personalizing targeted content more precise.<\/p>\n

Then there\u2019s data-driven lead scoring. Property intelligence firm Reonomy says its commercial data mine<\/a> \u2013 52 million properties, 100 million companies, 30 million personal profiles, and 53 million tenants \u2013 can be searched in multiple ways to create custom prospect lists.<\/p>\n

Check out Forbes.com\u2019s \u201c5 Ways Artificial Intelligence is Transforming CRMs<\/a>\u201d for a fascinating list of what AI can do, including analyzing conversations for sentiment analysis.<\/em><\/p>\n

4. Property and facility management<\/strong><\/p>\n

The Internet of Things (IoT)<\/a> is already helping property and facilities managers control and predict energy costs, as well as proactively address maintenance issues. Integrating smart technology like thermostats and sensors with AI also means more efficient space planning. Smart security cameras<\/a> and wi-fi tracking can create \u201cpeople heat maps\u201d that can identify underutilized or overcrowded areas.<\/p>\n

IBM\u2019s TRIRIGA<\/a> does that and more. Part of the Watson project, TRIRIGA offers AI-driven insights to show how people are actually using a space and ensure a company has the right amount of space in the right areas. It can also analyze common questions from a chat log, then use that data to create an AI virtual assistant to automatically answer those questions \u2013 and update itself as it learns new data. Maintenance requests, room reservations, and more can be fully automated.<\/p>\n

Strategic space planning has become even more important during the pandemic, as work-from-home trends and safety concerns reshape offices as workers return. (Need ideas for your office? IBM\u2019s Returning to the Workplace guide<\/a> might be a good place to start.)<\/p>\n

Barriers to adoption<\/strong><\/p>\n

There\u2019s no question that tech-enabled commercial real estate companies will have a competitive edge. The question is, when will more of them agree enough to adopt AI more widely?<\/p>\n

PropTech with and without AI has exploded over the past few years \u2013 and that\u2019s part of the problem. In an Altus Group survey<\/a>, 89% of CRE executives said the PropTech space needs significant consolidation before it can effectively deliver on industry needs; 43% said that is already underway or will occur within 12 months.<\/p>\n

Then there\u2019s the undeniable learning curve that comes with any tech tool \u2013 an investment of time as well as money. The survey also showed concerns about regulatory requirements for data collection and management, having enough internal capacity, and nonstandard data formats.<\/p>\n

Despite those perceived barriers, there\u2019s also no question that innovation and disruption from AI are moving at a dizzying pace \u2013 and that commercial real estate needs to keep pace.<\/p>\n","protected":false},"excerpt":{"rendered":"

Artificial intelligence is bringing a seismic shift to commercial real estate in everything from investing to sales to property management. Hold on!<\/p>\n","protected":false},"author":337832,"featured_media":19900,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"wds_primary_category":0,"footnotes":"","jetpack_post_was_ever_published":false,"_links_to":"","_links_to_target":""},"categories":[91],"tags":[975,2066,1234,299,324],"class_list":["post-16814","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-big-data","tag-ai","tag-proptech","tag-real-estate-news","tag-real-estate-technology-2","tag-technology"],"jetpack_featured_media_url":"https:\/\/theamericangenius.com\/housing\/wp-content\/uploads\/sites\/2\/2022\/08\/person-wearing-blue-ai-shirt.jpg","jetpack_sharing_enabled":true,"amp_enabled":true,"_links":{"self":[{"href":"https:\/\/theamericangenius.com\/housing\/wp-json\/wp\/v2\/posts\/16814","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/theamericangenius.com\/housing\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/theamericangenius.com\/housing\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/theamericangenius.com\/housing\/wp-json\/wp\/v2\/users\/337832"}],"replies":[{"embeddable":true,"href":"https:\/\/theamericangenius.com\/housing\/wp-json\/wp\/v2\/comments?post=16814"}],"version-history":[{"count":7,"href":"https:\/\/theamericangenius.com\/housing\/wp-json\/wp\/v2\/posts\/16814\/revisions"}],"predecessor-version":[{"id":19901,"href":"https:\/\/theamericangenius.com\/housing\/wp-json\/wp\/v2\/posts\/16814\/revisions\/19901"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/theamericangenius.com\/housing\/wp-json\/wp\/v2\/media\/19900"}],"wp:attachment":[{"href":"https:\/\/theamericangenius.com\/housing\/wp-json\/wp\/v2\/media?parent=16814"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/theamericangenius.com\/housing\/wp-json\/wp\/v2\/categories?post=16814"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/theamericangenius.com\/housing\/wp-json\/wp\/v2\/tags?post=16814"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}