It may have taken a while, but the CRE industry has begun to exploit the possibilities of technology, working more efficiently and with a more informed position than ever before.
Tech startups have turned their talents to CRE Tech in a big way over the last several years, and there are platforms and apps to address every aspect of the business. Venture capitalists have poured millions into companies developing tools to solve problems and increase efficiency in investment, property management, marketing, and the due diligence process.
As the expectations of our customers change, it’s become mandatory to incorporate technology into CRE wherever possible. It increases reach, speeds routine procedures, and ultimately improves service and performance overall. Some innovations stand out as particularly useful, and we discuss these below.
Crowdfunding allows a wider pool of investors to participate in CRE investment by sharing listings on platforms designed to make transactions more accessible, transparent, and secure.
Crowdfunding started as a way to raise funds for charity, and gradually came into use by individuals. With the 2012 passage of the JOBS (Jumpstart Our Business Startups) Act, an opportunity appeared for changing real estate investment profoundly. Through crowdfunding, investors can purchase debt and equity through more than 80 sites in the U.S., and the number continues to grow.
Many real estate crowdfunding platforms provide extensive information to help investors in evaluating offerings, vetting developers, and making connections. Some sites limit participation to accredited investors (those with an income over 200,000 or an net worth of $1 million+), but others can work with unaccredited investors, and minimum investments of $100.
The system benefits developers as well, since crowdfunding is ideal for funding smaller (under $25 million) projects that might not attract attention from large institutional investors. Such projects might take years to fund, or be dropped when funding did not materialize, but with crowdfunding worthy projects are routinely funded in a matter of days.
#2: Cloud Computing
The ability to store and share documents online has been causing a quiet revolution in CRE. Through practices like e-signing, these sites are eliminating the need for many fees and middlemen that were once necessary to complete transactions.
Managing documents in the cloud also gives our ability to collaborate a work in teams a big boost. Most of the things we do in CRE involve a collection of individuals working to get the job done, and using the Cloud means that each team member has access to the most current version of all the pertinent documents. No tracking them down. No calling around. This is big.
This is a critical source of information for CRE, and digital mapping software gives us tremendous flexibility and control over the information our maps present. Mapping applications can combine different types of data, and are interactive, meaning that the user can manipulate the data to make their own comparisons and get a graphic representation of different scenarios.
This type of tool helps brokers to more efficiently track trends and evaluate market potential. They can then present relevant information to their clients in a usable, compelling way. Firms can even integrate their listings with GoogleMaps and other search engine maps.
Mapping software offers customization options, letting the user set parameters and incorporate proprietary data. This makes the images and information meaningful and communicates trends and relationships in a way that a table of figures just can’t.
#4: 3D Technology
The ability to “see” a property from every angle, in a realistic 3D tour, has huge implications for investors, developers, and brokers who increasingly work in multiple markets. The use of 3D video tours and virtual models make remote work much more practical, and can communicate ideas extremely effectively. Services like Floored are taking listings to a whole new level.
Sensors are monitors that keep track of an array of situations, constantly logging information that can later be viewed in reports. Some of the most useful to CRE include monitors that provide pedestrian and traffic counts, as well as “smart” technology that keeps track of building systems and monitors conditions to avert potentially costly problems like water leaks.
Data from these devices can be gathered around the clock, and customers have access to informative, real-time reports. In the retail sector pedestrian counts supply valuable information, showing patterns over time. They can reveal not only the times of heaviest traffic, but even where most of the passersby are coming from. These are tremendous tools for evaluating potential investments and for scheduling and planning, and most are extremely affordable.
A technology that helps to create a more complete picture of any listing, drones used for aerial photography have been an exciting development for CRE. They allow us to provide a bird’s eye view of properties, showing the exterior as well as the surrounding neighborhood. Buyers can check out details like the availability of parking, the amount of traffic, and other important factors.
Although the FAA is still grappling with how to regulate them, drones are becoming more and more common and inexpensive. They have tremendous potential for CRE.