In an interesting podcast recently, Michael Wong of Genea made the point that commercial real estate’s adoption of technology was in large part a reaction to the economic downturn in 2007-8.
With the advent of social media, our potential influence expanded exponentially. Any user can now have a voice, possibly reaching thousands and playing a role in their decision-making.
A lot of us are just getting used to working with the millennial generation, that collaborative, flexible, socially-conscious demographic that makes up the majority of the current workforce.
We read a lot these days about the value of technology to businesses of all types, and it’s true that digital tools make us better. CRM platforms improve customer service and efficiency.
Big data, big deals, big markets…our business is full of imposing things. They obviously deserve some attention, but I’m here to tell you that the big things are not the most important.
First of all, let me say that in general, I learn very little in the men’s bathroom. Pretty mundane stuff, although TV monitors in new bathrooms means I can at least get some news and sports scores.
Being on top of things in the tech world can give you an edge in pretty much any industry, and CRE is no exception.
Is CRE Ripe for Disruption? What You Need to Know I’ve always been a big fan of disruption. When I started my own company in 1990 focusing on commercial real estate brokerage and advisory services, I was trying to disrupt at that point already. At the time, the only way I was able to disrupt was by partnering with CoStar; I was the second person in New Jersey to buy it. The tools and resources that I was now armed with would allow me to differentiate myself in the market.
CoStar took the research department out of the big firms and the complexity needed to create that on your own, whereby a small start up like myself could have the same market information as large companies. It gave me the opportunity to get into a business and provide data and services where I otherwise would have been average.
At that point it wasn’t a disruption per se, but it was really a start and the availability of using real estate technology in a different way in order to make our business and also the availability of our business to morph into something greater and move into different sectors.
In the early stages of my career, accounting systems all tried their very best to truly be an all inclusive product, but in reality, they only focused on accounting. Despite being disrupters in their own right, this made it very difficult to take the information and to use it effectively - especially when you compare it to the way we use big data, data mining and measuring now. The entire process was very much in the dark ages, but so was our industry! This doesn’t mean their products weren’t good, doing their best or that they weren’t efficient, but more so that we can do so much more today. In fact, they were pioneers in this field and they deserve kudos for their efforts to disrupt an industry that historically is quite antiquated.
Will Commercial Real Estate be Disrupted?
Absolutely! Today, there are millions and millions of dollars being poured into real estate technology investing like never before! Obviously we have a tech market surge in all markets, not just real estate. Yet, when you consider the size of the real estate industry and the impact that it has on our economy as a whole, it’s nice to see a bit of growth and disruption.
When you finally see the smart money coming into the real estate technology marketplace and they actually understand that these products are more than just fads and will literally change efficiency, ability to communicate with and reach clients/prospects, and more, I get really excited.
How Will This Disruption Take Place?
It’s technology that will disrupt this industry. It will disrupt in such a way that if you don’t get on the train of where this is going, it would be safe to say that you’ll end up disrupting yourself.
If I’m a person that took my entire operation and retooled it to what it should be and my competitor didn’t, I’m leading the curve. I would now have a disruption on how to sell in a much more efficient manner to service our clients and to have the ability to run my organization in a way that will be more efficient. This would also allow you to deliver a service level that you weren’t able to before.
Technologies in the real estate space serve as disruptions, because while I’m only in certain markets to start - since real estate is the most local business on the planet when it comes to deploying resources - with technologies, I am able to scale into different markets and become a competitor in areas where I wasn’t. There are so many more reasons why our industry is ready for disruption. This is just the tipping point.
Let’s hear your thoughts on the commercial real estate industry and whether or not it’s ready for the disruptions that are coming its way. Connect with me today on Twitter.