5 Ways Blockchain Technology could Change Real Estate

Blockchain and bitcoin technology are still in their infant stage. However, the technology has made steady progress as it begins to disrupt major industries and the debate over the potential uses and impact blockchain technology could have on the real estate industry is also heating up.

Commercial real estate has been considered a slow mover when it comes to adopting new technologies. This may also be the case for the acceptance of blockchain technology within the industry. All that could change fast if it could improve the bottom line. There are several ways in which bitcoin could impact the real estate industry, and we’ll review a few of these ideas and point you in the right direction in case you’d like to delve deeper.

Smart Contracts

Blockchain technology not only represents a new way to exchange funds or track payments, but it also has the potential make contracts smarter. The Blockchain’s distributed ledger can trace a series of events in chronological order, being able to mathematically verify these events eliminates instances of tampering or fraud.

The secure cryptography ledger can record events and create digital IDs for a multitude of scenarios. Some usage examples of this type of ledger could be for mortgage payments, escrow, or deed transfers. To make things simple, they allow for if-then statements in contracts to be made, then demanded fulfillment

Imagine if you finished paying your mortgage or you completed escrow on a new home or building. The moment those funds and conditions were met the digital contract would instantly transfer that deed ownership. Some would argue the Blockchain is the most reliable transaction record system ever created.

Foreign Investment

Investment into any foreign market is difficult today. There are many government conditions and terms, exchange fees, taxes, and regulations. Each country is different. However, all of them have their friction points.

Blockchain technology can exchange any value funds to any party regardless of location, identity or government regulations. This occurrence could bring up many issues in the future, but the demand to transfer funds and take advantage of changing currency rates will always exist.

Reduce Fraud

Banks are already using funds to research how blockchain could change the way they transfer funds.  Creating a certifiable digital ID allows for funds to be fully tracked. In real estate, the use of a proof of funds document or a bank letter is often used to show purchasing capabilities. These documents can often be forged or outdated. Often these documents are saved as simple .pdf files and can even be emailed and forwarded on without consent.

Blockchain provides a certifiable and instant way to verify ownership of funds. Picture an instance where you have verifiable proof of funds and a digital transfer of a deed. The Blockchain could allow two parties to exchange large assets instantly, securely and even anonymously.

Crowdfunding

Blockchain technology could allow crowdfunding to be even more liquid than it is today. New start-ups have come into the real estate tech scene recently that operate as secondary markets for alternative real estate investments. Companies like CFX are already setting up marketplaces to exchange these assets.

Bitcoin and sidechains could allow for these assets or fractional ownership in real estate to be traded quicker, and at a more accurate market price.

The Internet of Things

Just like blockchain, the possibilities for the internet of things are endless. Similar to our above scenario where blockchain technology could allow for smart contracts, the same could be said for the internet of things. The sharing economy has already taken hold as a major player in the tech space. The opportunity to share rides, cars, apartments, and homes has rippled through our economy.  In these instances, people are stuck doing some of the process or transaction. That may be dropping off keys for an AirBnB, or needed to meet someone in person to exchange a Getaround. What blockchain could influence is how we use tokens to grant permission for certain things to take place. A blockchain token could be used to open that apartment or car, or maybe to unlock a computer or phone.

Startups like International Blockchain Real Estate Association are starting to populate the blockchain / real estate space, with so many potential uses, only time will tell if blockchain can emerge as the next everyday real estate technology.

These 3 CRE Tech Trends are Fueling Capital Raises for Developers

Marketing approaches for CRE development projects have come a long way. Attracting strong buyers now involves strategic implementation of CRE tech tools that enhance and streamline the process. It’s worth incorporating new technology that brings projects to life, clarifying details and providing context.

Drones

An important new tool in many areas of the business, “unmanned aerial vehicles,” or drones, are changing the game in property tours and site selection. Drones can be used to photograph properties from new viewpoints to provide a clearer perspective on building size and location, as well as its proximity to transportation and other facilities. Through the drone’s camera, the context for proposed construction and renovation can be clearly established.  One look at the striking visual images and video provides extensive information and instantly communicates possibility.

There are rules for commercial use of drones, and these are still evolving as the FAA considers new uses that are being dreamt up. Usage is very restricted for Devices weighing over 55 pounds, and there are limitations on how high a drone is allowed to fly. Currently these small drones can only be flown during the day, and they have to always be within sight of the operator.  The FAA recently opened a site for registering these smaller drones.

Small drones are fairly inexpensive drones and easy to operate, but most firms leave that to specialists. Companies like Spark Aerial have come along in response to this need. They specialize in creating amazing marketing pieces for a variety of industries, including commercial real estate development.

Sensor Technology

Basing plans and marketing on data is an industry best practice, and sensor technology is becoming an important source of data in CRE. An electronic sensor can serve as a tireless assistant, gathering information and reporting round the clock from its designated location.

Traffic sensors have been around for years, and are extremely useful in city planning and evaluation of transportation systems.  The data on pedestrian and vehicle traffic patterns helps these agencies to optimize the use of space and also ensure public safety. In recent years, other industries have adopted these tools to inform decision making and increase efficiency.

Commercial real estate applies this technology as a source of data on any location.  It’s surprisingly easy and cost-effective to get set up and start gathering data. The hardware is very inexpensive and only requires an electrical outlet. This is a fairly trouble-free and low-maintenance technology. Support for these devices is provided by services like Motionloft, which also gather and aggregate the data for their clients. Property owners or managers can access this data at will and send useful reports to tenants and potential investors.

Sensor data are very valuable in setting the scene for proposed development. The level of traffic in a specific location helps to inform and justify all sorts of decisions related to demand, capacity, and potential returns.

Virtual Reality

Virtual reality is becoming widely used in CRE. It can be used by brokers, agents, and developers to create a remote customer experience that is very close to a physical tour of a property –and in some respects, even better.  Using headsets like the Hololens is making “augmented reality” a CRE term. Services like Foundry 45 are blazing a trail and expanding our idea of how VR can be used. Using VR, potential investors can be immersed in a speculative environment, and can be given a realistic picture of proposed construction or renovation.

Related tools can create 3D models that include incredible property details, and digital floor plans that can be shared in an instant.  These are powerful tools for collaboration and planning, and also expand upon the level of information that can be provided to prospective investors in a big way.  At sites like Floored you can find interactive 3D models, video fly throughs and other digital experiences.

3 Commercial Real Estate Technologies to Keep an Eye on in 2016

Developments in tech tools for commercial real estate have been coming hard and fast for the last few years. Adoption of commercial real estate technologies improve efficiency, accuracy, security, access, and transparency.

CRM platforms have become an essential tool for handling contacts, scheduling, transactions, and property management tasks. They streamline routine processes and enable customer service to reach levels that weren’t possible before.

Big data offers a wealth of practical applications for increasing productivity and efficiency in commercial real estate. This Forbes article makes a clear case for the critical advantages that can be found in the masses of data that we generate and to which we all have access.

Data is only useful if you understand it and can explore relationships and effects. In some cases, it may be worthwhile to employ data visualization services. These help clarify conditions in a given market and helps us to identify trends. This sort of service converts spreadsheets into a more digestible format that is also interactive and ready to share with clients.

In addition to software tailored especially to the CRE industry, there are specific technologies that are coming into wider use in the business, providing new ways to communicate effectively and new sources of data for better decision-making.  These are part of what is called the “Internet of Things,” in which devices communicate with each other, sharing and aggregating original data that combine to create a richly detailed picture- of specific properties, markets, or demographics.

Virtual Reality and 3D

One of the more futuristic technologies that’s becoming widely used in CRE is virtual reality (VR).  This is used to create a customer experience that is as close to a physical tour of a property as we can get today. Services like Foundry 45 are blazing a trail and expanding our idea of how VR can be used.  One avenue for innovation seems to be in ‘augmented reality,” through the use of headsets, like Hololens.

Digital tools are available that provide detailed 3D models of properties, and create digital floor plan templates that allow for very accurate planning and can be shared in an instant.  Sites like Floored also offer interactive 3D models, video fly throughs and other digital experiences.

Sensors and Smart Buildings

We think of sensors as little assistants that can be stationed at a given location to gather information, non-stop, with little or no supervision. Sensor technology is becoming an important source of data in CRE.

City planners have known for years the value of understanding pedestrian and traffic patterns in a given location. This information is very valuable in planning for optimal use of a space and for ensuring public safety and convenience.

The real estate industry, particularly the retail segment, has begun to apply this technology with great results.  The actual hardware is very inexpensive and simple to set up. Support for these devices is provided by services like Motionloft, which also gather and aggregate data Property owners or managers can access this data at will and send useful reports to tenants and potential investors.

Other smart building technologies can help save electricity and lower expenses. One such company is Genea which automates afterhours HVAC and lighting use.  Their technologies can be controlled through their cloud application from any device.

Drones

Drone footage is a visually striking way to present information and is changing our ideas about property tours and site selection. Also called “unmanned aerial vehicles,” drones can be used to photograph properties from previously unavailable viewpoints. A new, clearer perspective on building size and location, as well as proximity to transportation and other facilities is available through the drone’s camera.

The FAA continues to develop regulation for the commercial use of drones. Currently there are limitations on use of devices weighing more than 55 lbs, as well as how high they are allowed to fly. There are only to be flown in daylight, and always within sight of the operator. Small inexpensive drones can be useful for individual firms, but a more elegant and comprehensive solution can be found with companies like Spark Aerial, which specialize in creating amazing marketing pieces for a variety of industries.

This is just the beginning of what we’re capable of in the commercial real estate industry. What technologies do you have on your “must watch” list?

How Real Estate Technology is Changing Transactions

The last decade has seen profound changes in the way we conduct the purchase and sale of property. Players in every role have access to tools that make their lives easier. Investors, property owners, agents, and lenders all utilize digital tools to boost efficiency and make more meaningful connections.

The activities of all of these groups are intertwined, and technology solutions offer benefits to each. Here’s a look at some of the most significant tech tools for our industry, and how they enhance the work of everyone in CRE.

Access to documents and data

Using technology, work can be completed without regard to location. Platforms designed specifically for CRE store relevant data and documents. For investors, these sites complete much of the time-consuming due diligence that’s critical for evaluating deals. They often include extensive market data and local trends, as well as information on the property history and the seller.

Developers and owners can share details that give a comprehensive picture of the project, collecting the information once with the option of making it available to a limitless number of prospective investors.

Instant access to this information helps speed closings. On real estate crowdfunding sites, like Fundrise, projects are often funded in a matter of a few days or weeks. At Brevitas, we streamline transactions with our thorough verification process for both buyers and sellers.

Virtual networks

CRE platforms are doing more that just bringing together buyers and sellers. Services extend throughout the industry, connecting developers with lenders and the other professionals they need to do their work. One example is Honest Buildings, which is set up to connect developers and property owners with qualified and reliable contractors. This sort of access allows for price comparisons and competitive bids.


E-signatures

Allowing contracts and other important documents to be handled entirely in digital format is becoming fairly common, and for some good reasons. The first consideration is savings, both in time and money.

When important documents can be shared electronically, they reach their destination in seconds. Compare this with printing out the finished document and putting it in the mail, and considerable time has already been saved. This is especially true when multiple signatures are required. The process of reviewing, signing, and returning the document is made much more convenient using a digital approach. This speeds up transactions.

Another consideration here is security. While some are wary of e-signing, it is actually more secure than traditional methods. Access to the document can be strictly limited, while we have less control over paper versions.

Smart Contracts with Blockchain Technology

Blockchain technology not only represents a new way to exchange funds or track payments, it also has the potential make contracts smarter. The Blockchain’s distributed ledger can track a series of events in chronological order, being able to mathematically verify these events eliminates instances of tampering or fraud.

The cryptography secure ledger can record events and create digital IDs for a multitude of scenarios. Some usage  examples of this type of ledger could be for mortgage payments, escrow, or deed transfers. To make things simple, they allow for if-then statements in contracts to be made, then demanded to be fulfilled.

Imagine if you finished paying your mortgage or you completed escrow on a new home or building. The moment those funds and conditions were met the digital contract would instantly transfer that deed ownership. Some would argue the Blockchain is the most reliable transaction record system ever created.

Mobile technology

Perhaps the technological development with the greatest impact on CRE has been mobile technology.  For agents, this has allowed them to conduct business throughout their day. Before mobile devices were developed, agents had little access to information in the field. Now they can pull up relevant data on a property, check maps for demographic information, send images and marketing content to clients, and many other critical functions using their smartphone or tablet.

Mobile technology gives buyers 24/7 access to property information. Agents and brokers can respond to inquiries rapidly, and their clients expect it. In some cases, entire transactions can now be completed on mobile devices.

As we move into an era when buying properties sight-unseen does not raise the eyebrows it once did, and international investment is growing rapidly, technology plays a central role in the industry.  It’s about access, transparency, and efficiency. This matters to anyone determined to compete in CRE.

6 CRE Technologies of the Last Decade that Changed the Industry

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.

#1: Crowdfunding

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.

#3: Mapping

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.

#5: Sensors

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.

#6: Drones

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.