A new year, a new decade. With this fresh start, we see a lot of opportunities within the commercial real estate industry. Change, growth, and innovation will mark the year ahead.
Despite some economic uncertainty, investor confidence remains steady with positive signs pointing toward a strong CRE market. Technology specifically is poised for exciting developments.
Commercial real estate technology—also known as CRE tech or property technology—refers to both the hardware and software used to digitize and transform the commercial real estate industry.
Essentially, CRE technology has made it possible to streamline entire brokerages into one system, simplifying daily business tasks for all commercial real estate professionals.
Some existing, commonplace technology in CRE that most professionals have come to adopt include:
Historically, commercial real estate has lagged behind other industries in terms of incorporating advanced technologies into everyday practices; however, that is no longer the case. Real estate tech investment had its best year in 2019, and 2020 was expected to be even better prior to COVID-19.
Here’s a look at what we are seeing on the horizon and what we’re looking forward to in 2020.
It’s the coming-of-age of the millennial broker. The National Real Estate Association found that millennial agents make up 18% of all agents, up from 11% in 2012. This younger generation of brokers—which spans an age range of about 22 to 39 years old—is beginning to have a larger influence on the industry.
Millennials expect quality. They aren’t afraid of technology and see it as a competitive advantage. As such, the barrier to getting brokers to try technology has lowered, but the expectations for ROI are higher now than they’ve been in the past.
Technology needs to live up to its end-to-end promise and deliver value. Millennial brokers want tools that allow them to work from anywhere, communicate easily, and streamline their business.
We see this as an opportunity for tech companies to increase investment and provide solutions for these tech-savvy brokers.
If you’re still relying on a Rolodex or excel—you’re risking being left behind. That’s because the infrastructure of technology is getting better and better with the introduction of improved software providing connected solutions.
And we know brokers are taking notice and want to see these tech solutions applied. Recent research from Deloitte found that 72% of CRE executives surveyed plan to maintain or increase their technology investments, even if an economic slowdown occurs.
As a part of that, brokers will likely prioritize technology that has a real application in their day-to-day business, as well as technology that covers multiple aspects of their job, allowing them to achieve peak productivity and work in an integrated way.
Every year brings the advancement of new tech products and increased adoption. The key to success here will be creating products that address brokerages’ needs and meet their expectations.
Across all of these observations and predictions, the emerging theme is one of value. Brokers in the CRE industry—especially millennial brokers—are looking for high-quality technology with real-life applications that can be fully integrated into their businesses.
In 2020, new products must meet these demands by delivering solutions that truly address the needs of CRE brokerages to stand the test of time.
CRE technology is finally exploding, and competition has never been more intense in the industry. Retail, office, multifamily, and brokerages themselves are all going to be revolutionized as a result of CRE technology transformation—and it’s crucial for your brokerage to keep up.
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