How Tech's Transforming the Commercial Real Estate Industry
The commercial real estate industry may have been slow to catch on to the technology craze, but a wave of new innovation is hitting the sector in a big way. New apps and websites are completely changing the way it does business, for buyers and for real estate agents. This year is on track for more than $1.4B invested in real estate tech startups, up from $1B in 2014 and $438M in 2013. So, gone are the days when real estate purchasers had to rely solely on their agents to supply the necessary information. Now buyers can access info just as quickly as their agents, and in some cases quicker.
You can pretty much thank Craigslist for the dawn of the information age in commercial real estate. The listing platform prompted a shift from classified ads in newspapers to listings displayed on sites like Yahoo Real Estate and MSN House & Home. This transparency gave buyers more control, and the positive response paved the way for more innovation to come. Roughly 20 years later, buyers have a plethora of tools at their fingertips, much like a prospective car buyer has access through sites like Autotrader.com.
They have access to resources like Reonomy, which analyzes real estate data; Compstak, which crowdsources hard-to-find commercial lease comp info; Tenant Rex, which determines trends and market insights for negotiations; Floored, which produces virtual tours of properties and helps you adjust your floor plan; and Honest Buildings, which hooks up developers and building owners with quality architects, contractors and vendors. Additionally, Hightower lets landlords and brokers work together in real time. And a new location intelligence platform, called Piinpoint, helps retailers looking to relocate, expand or close, predict future sales and check out new locations, factoring in geographic and demographic variables. The company claims to be about 80% accurate.
Pictured: The Oculus Rift virtual reality headset for viewing property interiors.
Don't think all this access means the real estate agent is headed to the dinosaur exhibit at the Museum of Natural History. On the contrary, all this technology just begs for a professional who knows how to navigate it properly. Now agents and brokers can focus their energy on providing more specialized service to clients. New technology allows them to attract more clients, especially as modern customers often begin searching online years before contacting a realtor. It also helps agents respond quickly and help their clients get better deals.
Tools like Desktime allow agents to assist clients looking to convert unused office space into co-working space. Agents and brokers use sites like Auction.com to connect clients with potential investors and lenders. And companies like California-based Matterport and Oculus make the virtual reality experience possible, so you can check out properties in the comfort of your own home. In fact, Matterport, which produces -D home interior tours, plans to make exteriors available in the future.
There's still a lot to learn regarding technology in the commercial real estate industry, so expect some growing pains ahead. But experts still believe the future will be promising. As more innovative technologies roll out, we can hope to see more improvements, from the scope and accuracy of data provided, to the ease of all aspects of transaction. Victor Lund of WAV Group Consulting, believes that one day buying a home will be like buying a car, where customers will be able to sign the papers and take possession all in one day.