Following the Money: Is Proptech the Pied Piper or the Savior of Commercial Real Estate?

Proptech is advancing all areas of commercial real estate from developments in building innovations and blockchain technology to smart homes and green tech. If you are a commercial real estate agent, you are noticing the change. Globally, real estate is the biggest industry and depending on where the data comes from, its value ranges from billions of dollars to trillions of dollars. That is a lot of money coming from one sector with investors throwing more into proptech innovations daily.

So are all these changes in technology making the road to success easier or are they leading you down the wrong path? Tech investors are flocking to the real estate industry because they envision a future that allows you to better share information, control energy consumption, and improve construction workflow.

Precise Information

Change is good. Without the use of current technology, it would be virtually impossible to do business in today's commercial real estate market. Technology has allowed you to precisely measure square footage calculations, visit properties through 3D tours and submit all legal documents necessary through online methods. Simply put, proptech and CRE go hand in hand and incorporating them into your daily routine is essential. You cannot afford to fall far behind in your use and understanding of proptech, or you stand to lose your way.

Data

Commercial real estate deals with a huge amount of data. Everything from contracts and legal documents to building information and management operations. There is a need to provide easier and faster ways to source and transmit data. Enter the technology sector. Tech investors are jumping into the billion-dollar real estate industry to satisfy the need. According to Prescriptive Data in 2019, there were over $31 billion VC proptech investments. Companies are investing in ways to supply better and more accurate ways to deal with all the data through a variety of innovative methods.

Blockchain

Blockchain technology is not just for cryptocurrencies, it takes on a whole new meaning when delivering information in the commercial real estate industry. This developing proptech helps to easily maintain and control transactions in a very transparent way. Future audits of facts and figures are simplified through the use of blockchain technology benefiting you as a real estate agent by allowing verification of transactions quickly and easily. Reducing risk and streamlining processes are just some of the perks you can look forward to.

Construction Management

It's no simple task to construct a multi-level building from the ground up. Proptech building information modelling (BMI) will help in the planning, construction and management of a building's infrastructure for the entire lifespan of the property. You will be able to see real estate floor plans in 3D transformed entirely from hand-drawn sketches in a matter of a few seconds. Not only does this technology help everyone involved from architects and engineers to construction companies, but it will help provide current information to any prospective purchaser.

Investments and Operations

In a commercial real estate transaction, you need ways to accurately supply information to assist in your real estate marketing plan. Current proptech trends are developing ways to supply real-time data allowing management to make better-informed decisions. Up to the minute statistics on a property's history, neighborhood details and current ownership costs will provide for better ways to estimate the value and future value for decision making. Smart technologies will be able to monitor various algorithms and adjust for safer and greener environments. Monitoring airflow and energy consumption are just a few benefits of proptech innovations. All this translates into buildings being more attractive in rental markets for both the purchasers and end-user.

Benefits for Real Estate Transactions

Critical data for both commercial and residential properties will be available to include geo-location technology for planning and development purposes. Details on topography, flood zones, and soil stability will speed up the process necessary for construction and redevelopment sites. For real estate agents and lawyers, property transactions will be verified instantly for legal documents, land titles and transfer of ownership. Through advancements in technology, all of a building's information can be digitally transferred in a matter of minutes. Waiting for week-long responses to register a sale will soon be a thing of the past.

Technology and CRE have travelled on different roads for a long time. But the future is clear, following the money trail could lead you on a path to success.