Real estate has been among the industries seeing the most technological innovation recently. With the advent of COVID-19, implementing these technologies has saved several companies from bankruptcy.
We have plenty of reasons to consider hopping on these trends. To help you do so, we've compiled the most relevant ones for commercial real estate. We'll also go through expert expectations for the industry and a few tips for implementation.
Most Important Technologies for 2021
Innovation has grown into an industry of its own throughout the years. There's plenty of documentation online about growing technological trends, but finding the most important ones, for property management can be tricky.
Luckily, Forbes has an article dedicated to the relevant trends for commercial real estate. However, their article on the biggest upcoming trends also has insight worth keeping in mind.
ERP Software
That's mainly for property management software, like Yardi and MRI. These platforms allow companies to track their entire building statuses. That includes maintenance, vacancy, and tenant requests remotely. The amount of data generated by commercial real estate is enough to justify these systems.
Augmented Reality
The pandemic, and the resulting social distancing regulations, made virtual tours a standard for property management companies. However, as the pandemic subsides, many people will prefer digital engagement because of its convenience.
Data Analytics
Again, commercial real estate generates prominent quantities of data, which makes data and its analysis vital for making good decisions. Primarily, data will play a huge role in finding which markets make the best investment.
Robotic Process Automation
We've personally seen how RPA has become more of a standard for real estate. The COVID-19 crisis made it even more important, as the need for social distancing and financial uncertainty demanded optimal efficiency.
Artificial Intelligence
AI and machine learning are basically the next steps in process automation. As its "more primitive" counterpart becomes more popular, so will AI. Similarly, companies figuring out how effective this technology can be will maintain demand this year.
5G Connectivity
The internet is more important than ever. Remote work, cloud software, and other innovations demand better connectivity. Therefore, 5G will become a crucial asset for companies looking for an edge over their competitors.
CRM Software
Managing customer relationships is still important, despite social distancing. That means remote customer service, via CRM platforms, will keep gaining attention from companies. Additionally, the integration capabilities of some of the more modern systems make them better investments.
Trend Implications for Commercial Real Estate
One of the leading companies for property management software is MRI. Their knowledge of the industry and its needs is nearly unparalleled.
The good news, they also share plenty of their insight via articles and reports. For instance, their report on 2021 technology trends for real estate offers an excellent look into what these trends mean for companies.
Landlord-Tenant Dynamic
The pandemic did nothing but strengthen the importance of maintaining good relationships with tenants. Issues with paying rent and hiring services—from both parties—have put this dynamic to the test. As everyone starts to recover from COVID-19, these practices will remain relevant to help everyone recover.
Office Space Use
The office market saw some of the worst repercussions from both the pandemic and healthcare regulations. As remote work becomes more popular, the demand will keep decreasing—even though a bounce is expected. However, social distancing trends might require more office space for every employee.
Communications
Improving communication with your tenants is always beneficial for everyone. 2020 showed how vital this aspect was for building and maintaining good relationships. Landlords should keep their tenants up-to-date on everything that's going on, and the same is true for tenants facing financial uncertainty.
Digitization of Residential Property Management
As we mentioned, being able to monitor your buildings from a cloud dashboard is a primary advantage for anyone. These systems also let you process payments, handle requests, and screen applications without having to leave your home.
The Issue with Fraud
MRI Software's article also points out a growing concern related to the increase in the number of online transactions. Fraud triggers have escalated noticeably with coronavirus. That means companies require proper knowledge and security measures to avoid losing money.
The Importance of Flexibility
Finally, the best strategy to tackle 2021 is to focus on versatility. While recovery will start soon, it won't be the same for all sectors. Playing to your strengths and choosing the right tenants will maintain profitable occupancy during these times.
How Will Commercial Real Estate Change with These Tools?
JLL opens its article by questioning whether or not the industry should consider changing. It makes a great point when mentioning the increased competition to get corporations as tenants. We need to consider the industries that have thrived during the pandemic.
Proptech has experienced some reluctance from companies in terms of implementation. Coronavirus has challenged this mentality. The future will likely do the same, with sectors, like coworking expected to flourish thanks to remote work.
According to JLL, investors will focus on companies with the expertise and will to adopt these upcoming technologies. That's for more than reducing operation costs thanks to automation and digitization. The competition will likely force "outdated" companies into reduced income.
The Post-Pandemic World
Remote solutions (i.e., remote work, transactions, and even property tours) will likely dominate the Proptech landscape after the pandemic. They offer more than social distancing. They're noticeably more efficient and comfortable for workers and tenants.
While digital adoption isn't a recent concept, 2020 acted as a catalyst. Online conferences and similar solutions have grown exponentially in popularity. Companies will need to adapt to these developments if they want to thrive in the post-COVID era.
This Change Isn't as New as You'd Think
The World Economic Forum reported the impact of technology on the real estate industry back in 2016. It's an interesting contrast compared to today's landscape. For instance, the article mentions telecommuting as a non-viable option for some companies.
However, the article has excellent insight, especially in hindsight. We can both assess which observations are still relevant and what they mean for future expectations.
What Has Happened These Last Years?
From cloud storage to improvements for traditional Software, like OneDrive, we were already on our way to modernization. Meeting apps also became more reliable. Combined with better internet accessibility, we can see that we weren't too unprepared for the pandemic.
Ideally, Companies Have Been Adapting Before the Pandemic
The article also touches on how many companies years before the pandemic adapted to remote work for their employees. However, we say "ideally" because other firms strongly believed (and still do) on the importance of proximity for natural operational development.
How Have These Expectations Met Today's Reality?
The most important prediction for the article is how technology will keep imposing challenges on traditional office spaces. As more Software adapts to the remote work approach, it's becoming more apparent that office real estate needs a shift in its approach.
What's Up With the Internet of Things?
The IoT has been more than a buzzword in recent years. It's been around for a while now. It has benefited from many innovations, like blockchain technology and the Software as a Service model.
Since 2017, according to Hidden Brains, the IoT has been making its way to real estate. The article explains that commercial real estate might be among the most prominent IoT users, but smart homes' popularization could shift that trend.
How Have These Expectations Met Today's Reality?
It would help if you made sure that your different apps integrate with each other to avoid conflicts with different processes. Data will also become more important as modernization occurs, and leveraging this data might be a challenge. The same is true for keeping proper security and privacy measures.
How Could it Change Commercial Real Estate?
A Few Tips for Implementing These Technologies
Finally, we want to offer some of our opinions on technology implementation. We've helped dozens of companies through the years with integration and onboarding for the market's latest systems.
From this experience, we want to share a few tips that have helped our clients considerably. Following these three simple guidelines will ensure you make the most out of your technologies.
Assess Your Real Needs
Many companies fall for the idea that more features mean more value. You can save lots of money if you avoid features you don't need right now.
Dedicate a Budget for Implementation
Implementing Software can be expensive. It requires buying licenses, staffing, training, and support. Make sure that you account for these factors when budgeting for your Software.
Work With Experts
Digital adoption is a complicated matter. Many companies simply lack the expertise necessary to carry out these processes, so working with an experienced team is advantageous.
Integrate with Kriyago Blox and do More!
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