An article in the Vancouver Sun has highlighted the fact that even though trillions of dollars are invested globally into commercial real estate, this sector tends to use outdated IT programs that are at risk of inaccuracy and human error.
A report by the Altus Group, a Canadian-based information technology firm found that even though commercial real estate has seen an enormous amount of capital growth over the past few years, it has been under-investing in information technology to handle this new influx of capital. In comparison with other sectors such as healthcare and finance, commercial real estate hasn’t spent nearly so much money on new information technology software. The concern is that current IT systems aren’t sufficient to be able to absorb the new investment efficiently. This is in contrast to the fact that the industry has been placing priority on smart building technology, improved energy efficiency and automation systems.
Somewhat surprisingly, it is estimated around $11 trillion of commercial real estate investments worldwide are being handled by spreadsheets. The concern is that any time where the systems or processes used are manual then there’s the possibility of human error as well as a lack of visibility. In addition, experts feel there is a need to eliminate data silos, where information is overlooked or lost due to an inadequate data management system. With commercial real estate portfolios, managers and officers need to be able to access data across different markets which is very difficult to do if the information is contained in spreadsheets.
Some commercial real estate companies, for example Collier’s international in Vancouver, Canada are already taking steps to introduce new information technology and are trying to understand how best to utilize it. These steps have included the introduction of small drones to record aerial video tours as well as interactive video tours of property interiors and buildings. Additionally, Colliers has begun using a state-of-the-art customer relationship management program that is able to synchronize data from across the country.
There’s a growing realization that sophisticated IT software is necessary to provide good commercial services. If information is disconnected between different offices or if brokers are unable to communicate then inefficiencies can be created as it will be impossible to see trends emerge from the data. One of the things facing commercial real estate companies is the need to prove the bottom-line benefits to their teams, particularly as somebody within the firm will have to spend time learning how to use the software, understanding how it will benefit brokers and then communicating these benefits to the rest of the team.
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