Commercial real estate investors that are considering corporate real estate tech often come to a crossroad. The CRE tech could help grow a property portfolio and make it easier to manage, but there are often upfront costs in terms of the technology itself and making operational changes to accommodate the tech. You have to make the investment without knowing what the return will be or if something better is right around the corner. It’s the type of conundrum that can cause inaction. In the past, Heads of Real Estate could get by staying the course because the commercial property industry operated relatively the same for decades and they mainly relied on brokers. But now, proptech has firmly taken hold in the corporate real estate industry. Pair that with dramatic post-pandemic shifts and corporate occupiers that stay the course may find themselves falling behind the curve if they fail to invest in proptech solutions.Now more than ever, corporate real estate managers can benefit from the data and insights CRE tech provides that are hard to see on your own. With recent advancements like artificial intelligence, corporate real estate tech can even improve projections for the future. How much benefit is gained all depends on the solution you invest in.
The ultimate goal of adopting a CRE tech solution is to support your business goals. If a solution isn’t getting you closer to your business goals it might be a cool piece of technology, but it won’t provide the benefits you’re looking for or expecting.In order to find ideal CRE tech solutions, it’s critical to first identify your business goals. In other words, what do you want a solution to help you achieve? The more specific the goals are, the easier it will be to find the right commercial real estate tech solutions.
Today, there are CRE tech solutions for a very wide variety of needs. You can find highly targeted, single-purpose solutions as well as more robust platforms with dozens of features that can serve up a continuous stream of CRE data. It’s easy to lose focus of your business goals when there are so many options, features and tools coming to market one after the other. Taking the time to clearly state your goals for using CRE tech and analyzing where there are procedural gaps that CRE tech can fill will help you identify the best solutions. Considering only the solutions that support your goals also gives you a better idea of what you can expect to get out of the technology.
Gauging the payoff of a CRE tech investment can be difficult, although more and more CRE investors understand the potential value. And with each passing day as more firms and corporate occupiers leverage CRE tech, portfolio managers who don’t have a technology solution will appear less relevant, agile, and informed. But, like any investment, there needs to be a payoff to make it worth the capital. It’s important to understand that seeing gains after implementing a new tech solution or data analytics strategy can take time. It may take several months of gathering commercial real estate data just to begin determining the return on your investment. Below are a few signs that your CRE tech investment is paying off. You’re using it. One of the biggest hurdles for incorporating a new commercial real estate tech solution is adoption. You can have the best piece of technology in the world, but if it goes unused it provides no value. It’s like having a gym membership with the best trainers, but never actually going to work out at the gym. All the resources are there, they just aren’t being utilized.This can happen for a few reasons:
So, if you’re using the solution, that’s the first sign to look for to determine if you’re getting value as expected.It saves the team time/eases the workload. The whole point of CRE tech is to provide solutions that make a portfolio manager’s job easier. Ideally, technology should relieve some of the busy work and grunt work of CRE portfolio management. It should be all about automation rather than manual labor. The tools should be intuitive to use, and CRE data should be easy to read. Relieving the workload or time it takes to manage a corporate real estate investment portfolio is often enough of a benefit to make the investment worthwhile for investors. However, if a CRE tech solution has only added to your workload that’s an indicator the technology isn’t being leveraged properly or it’s too difficult to use. The corporate real estate data is informing decisions. There’s no denying that CRE data is a game-changer that can provide endless insights into your market.
What you do with those insights and how you make the information actionable is what truly makes a difference. If you choose targeted CRE tech for your specific goals, or even a solution like RefineRE that provides a suite of tools, data aggregation, predictive analytics, and reporting designed for the commercial real estate market, it should be easy to apply the insights and analytics that are gained. Customers on the RefineRE platform use their CRE data to make decisions about:
The possibilities of what can be accomplished with CRE tech are amazing. But that doesn’t mean every investment is going to pay off. Sometimes it takes a little while to determine what kind of effect, if any, a tech solution has had. However, there are a few ways to tell early on if your CRE tech strategy isn’t working. You don’t see progress toward meeting business goals. This is the clearest sign the CRE tech solution isn’t working as expected. Before a technology solution is implemented, it’s important to use a tool like BenchCore to get baseline metrics and benchmarks that are connected to your business goals. Those baseline measurements and data quality can be used to determine if progress is being made.
You may also be able to pinpoint the issue or get an idea of how the tech strategy can be adjusted by comparing different market data points. The CRE tech provider suggests something different. Good CRE tech providers know exactly what their solutions are capable of and who they will work best for. They also know when their tools and datasets aren’t performing. If the expected results aren’t achieved, the data provider should suggest an alternative or changes that can be made to get results. The commercial real estate tech provider may also suggest additional technologies that can be used in conjunction to get the results you want. When big data technologies are used together in this way it’s called a tech stack.
It’s very common for companies to find that a single CRE tech solution isn’t going to solve all their problems, but tech stacking covers most or all the bases. As the CRE tech market expands and becomes more diverse, portfolio managers will find more ways to leverage technology. However, the only way to see a real benefit is to invest in the right type of CRE solutions that you can use to make informed decisions, optimize portfolio performance, and find more opportunities before the competition. It may take time and a little trial and error, but the long-term benefits of investing in CRE tech should be worth it.