Who Will Control the Future of Commercial Real Estate?
Commercial real estate is aging and agents know that it is now or never to define the future of the industry. The industry has been a notoriously late adopter of technology and is seen as being behind in diversifying the field. Even as tech has seeped into almost every industry imaginable, commercial real estate has held out for a long time. Holding out, though, does not seem to be the trick for the survival of CRE. In order for commercial real estate companies to make it in the future, they are going to have to integrate both technology and fair representation in a major way. For the firms that have resisted these critical advancements until now, is it too late?
In 2019, the real estate industry has seen the impact that technology can have on reaching consumers. Companies like Zillow, Compass, Redfin and Trulia have changed the way that consumers interact with agents and with the process of buying a property. These companies have quickly become the most popular way for property buyers and prospective clients to view the properties in their area, take tours and even buy directly. Just as residential real estate has accepted the new way of operating and leaned into the opportunities that tech presents, so too must CRE.
The slow uptake of technological solutions in commercial real estate cannot continue for long. A number of companies have started to modernize, and this means that other companies are going to have to follow suit or risk getting left in the dust. A CRE firm without the most recent technology is already behind on the curve. Companies like CRExi, one of the first user-friendly online CRE companies, are poised to take control of the industry and direct the future of CRE.
According to CREtech, there are about 4,000 CRE startups inhabiting the CRE landscape in 2019. Big CRE players have gradually integrated technology into their business models, adding online capabilities to their websites and investing in technological services to fulfill needs that arise. As the startups and CRE giants begin to push against each other, there are many things that can happen.
The future will be a question of who is able to succeed in the industry. The use of technology and innovation in CRE is an important factor in the continued success of a company, but many wonder if it is enough for the thousands of startups in the industry to carve out a sector of the industry. Large CRE firms will have an advantage, even if they are late adopters of technological solutions. Their existing connections to the market will allow them some leeway when it comes to the time it takes for them to modernize, but not much.
While technology is crucial to reaching consumers, the capabilities and talents of a firm’s staff are crucial to ensuring that the company has a place in the future of the industry. While many other industries have been shaken up when it comes to hiring practices and equal representation of people of different races, sexes and ability statuses in the last few years, CRE has been slow to diversify hiring practices and select new top talent. According to National Real Estate Investor, adopting diversification strategies and practices is one of the major ways that a firm can invest in its future and better meet the needs of the buyers of tomorrow.
The steps that the CRE industry needs to take are clear. The industry has kept to the same routines and practices for a long time, but it is in need of some technological and humanistic advancements. The companies and firms that are able to adapt and respond to the changes in the years to come will be the best suited to build the landscape of the future.