The New Wave of Innovation
NEW YORK CITY—There is a tidal wave of innovation currently sweeping the commercial real estate industry. Never before have we seen so much potential for change in such a short period of time.
This “new wave” has been accelerated by a confluence of factors, said Elie Finegold, CBRE’s SVP of innovation, during CRE // Tech Intersect, a recent technology symposium here. According to Finegold, three major factors are driving the innovation today: the speed of start-ups, the consolidation of decision making and mobility.
A significant accelerant has been an unprecedented amount of investment by venture capital firms. Over $150 million has been raised by CRE technology companies through the contributions of VC firms in the past twelve months.
No area is off bounds for these new companies. The way users and owners of commercial space find, finance, build and manage their real estate all have potential be changed by technological innovations. The technologies being developed present potential to both enhance and dilute the efforts of real estate professionals. The best way to prepare for success is to understand what these new wave companies are doing.
The diversity among the participating technologies created an equally diverse dialogue at the symposium. However, several participants emphasized the following concepts:
Crowdfunding – Equity syndication enabled by online platforms are moving fundraising activities online, and in the process building a new way to market and execute capital market transactions.
Data driven decision making – Increased data transparency and real-time availability on cloud and mobile optimized collaboration platforms are changing the way clients work with their CRE service providers.
Democratization of data – Crowdsharing is opening the door to a new era of data proliferation, allowing junior professionals to access information that was traditionally limited to senior professionals or large organizations.
Flexible space options – Marketplace solutions are enabling occupiers to find and use space by the hour, day, month or year; oftentimes unrestrained by a lease or sales contract,
Open data and open API’s – Platforms are looking at transparency as a competitive advantage, allowing professionals and other companies to access data without barriers.
Process automation through SaaS – Centrally hosted subscription based services are automating traditional activities, like distributing marketing materials across multiple platforms or managing customer relations.
3D Property Visualization – Property and spacevisualizations are becoming more interactive, accurate, and inexpensive.
Internet of Things (IoT) – Interconnected sensorsusing Near Field Communication (NFC) and Bluetooth Low Energy (Bluetooth LE) are helping occupiers better understand how to optimize space use.
Understanding what these “new wave” companies are doing will be critically important to ensure professionals stay competitive. By taking a more consultative approach to meeting client’s needs and leveraging today’s top technologies we can position ourselves for success.
Technology will not replace the roles of professionals today, but it will redefine those roles.
Pierce Neinken is West Region solutions director for CBRE. The views expressed here are the author's own.
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