Can AI Transform The Commercial Real Estate Sector For The Better?
“I think the automation of vision is a much bigger deal than the invention of perspective.” —Trevor Paglen
In today’s commercial real estate market, artificial intelligence is the biggest disruptor. And by all indications, it seems this trend is here to stay for years to come. More than ever before, investors today need to be flexible to broaden their perspective and see the bigger picture. Automation may play a significant role in that puzzle, serving as both a tool for gathering the necessary data and a means of optimizing the utilization of time and resources.
From development to sales and property management, AI has the potential to influence the industry at every level. Let’s look more closely at the top 3 ways that intelligent technology can bring significant changes to the commercial real estate sector and what it implies for the future of the industry.
AI as the Marketing Executive:
Think of AI as a marketing executive and the ease of business it can bring. For starters, CRE companies can utilize AI for lead management to show personalized advertisements or promotional content to potential buyers and customers. AI might potentially be used to analyze market data and suggest properties for brokers to buy or sell depending on their prior sales performance.
AI can help with the thorough analysis of customer interactions during the mortgage or home-buying process. This can further help in customer service analytics. AI-powered chatbots may also be used to quickly respond to any questions from potential customers and present tailored answers depending on their preferences, all without the need for a sales agent.
The potential of AI goes beyond its capability to collect large amounts of data. Natural language processing (NLP) algorithms can be particularly useful because they allow companies to divide up their results based on geography or demographics to learn more about consumer preferences.
AI as the Data Manager:
CRE companies often have to deal with enormous databases of lease abstractions, property appraisal reports, offering memoranda, legal documents, tax reports, ownership history records, zoning rules, and other vital information. As the volume of data increases, AI can pitch in to categorize and store important documents and even send out proactive alerts when something like a new appraisal is due or a property spikes in popularity.
Analyzing the population of a city by using conventional manual techniques will give us results in months. But if we use the expanded ability of AI and automation to gather and process large quantities of data, we can have the same information in days.
In 2023, the need for this will be more pressing than ever. Although remote work will likely become the new normal in the coming few days, no one is yet certain what that will entail for office spaces and the commercial ecosystem that usually develops around them.
The major stakeholders in commercial real estate must anticipate these trends. Companies that can adopt intelligent automation will probably find it easier to navigate through this changing landscape than those that continue to rely on manual processes.
AI and loan modeling:
Using extraction and classification technology, manual and repetitive tasks like financial modeling and data entry can be automated, saving real estate analysts time, boosting productivity, and reducing errors.
How will this benefit CRE companies? The first would be a decrease in expenses because they will no longer be paying someone to enter all that data. As a result, employee time would now be dedicated to more worthwhile things. Since machines are more accurate than people in these fundamental activities, the data and the analysis of it will be error-free and more valuable.
AI is equipped with pattern recognition abilities. CRE companies can use it to their advantage. AI can be helpful in risk forecasting and manual property appraisal by taking into account factors like infrastructure and transportation improvements, environmental changes, local neighborhoods, and other amenities that can influence property value.
How can CRE companies approach AI implementation?
Although there are infinite possible applications for AI in this sector, the most common applications of AI in commercial real estate fall into one of three main categories: logistics, search, or negotiations. Of these three, employing logistics automation may provide brokers with significant time and money-saving benefits. As a result, it serves as the finest entry point for individuals wishing to dabble in AI implementation.
Start with something simple and quick to deploy, like a scheduling program or an automatic customer communication and response option. You’ll be able to expand your use of AI to additional areas with confidence as you get more accustomed to using the technology.