Page 48 - RC19 RealcommEDGE 2019 Fall Issue

Business Solutions

THE INNOVATION OPPORTUNITY

IN COMMERCIAL REAL ESTATE

A SHIFT IN PROPTECH ADOPTION

AND INVESTMENT

JEFF HAYWARD intelligence and machine learning in areas that they
VP, Global Marketing & Communications believe will see the greatest benefit, such as:
Altus Group
• 41% of firms are using automation for benchmarking
Commercial real estate (CRE), like other industries, is and performance analysis, 39% for scenario and sensi-
adapting to today’s ‘data everywhere’ world and making tivity analysis and 36% for budgeting and forecasting
investments to create value through data and analytics. • 19% of firms are using AI and machine learning for
We’re at a turning point in embracing technology and scenario and sensitivity analysis followed by 16% for
we’re entering a state of experimentation, adoption accounting and property management
and investment as new technologies and applications
continue to emerge. This higher level of engagement and Disintermediation: Cutting out the Middle
investment has the potential to enable the development Disintermediation is also driving emerging technology
of solutions that are better equipped to solve the unique adoption. New business models associated with the sharing
challenges of the industry. economy, co-working and e-commerce are disrupting the
CRE industry by cutting out middle steps and processes
Altus Group, a leading provider of software, data to create greater efficiencies. The layers and stages of
solutions and independent advisory services recently the financing, funding and transacting process create
released the latest Altus Group CRE Innovation Report. inefficiencies in many core CRE functions. As a result, the
It provides an outlook on technology trends impacting rise of disintermediating technology platforms and solutions
the global CRE industry and highlights the significant are having a major impact on the CRE industry.
acceleration in adoption of PropTech, the effect of
disintermediating technologies, as well as a growing The report findings suggest that transaction-based
trend of CRE firms investing directly in PropTech platforms such as online property exchanges, lending
companies and startups themselves. marketplaces and crowdfunding are now increasingly being
used to streamline processes and create a more direct
Automation, AI and Machine Learning line between buyers and sellers, lenders and owners, and
Having Major Impact investors and funds, effectively altering the relationships
According to the report, which is based on a global between them at a fundamental level:
survey of 400 CRE executives at firms with assets
under management (AUM) of at least US $250 million • 61% of CRE executives indicated their firms are using
representing a total AUM of over US $2 trillion, driving or already trying out online lending places, with 23%
efficiency through automation is a key priority for CRE using them in a significant way
executives, and the use of AI and machine learning • 60% of CRE executives indicated their firms are using
is approaching a critical mass. Firms are not only or already trying out online investment marketplaces
focusing on improving business intelligence based on and crowdfunding platforms, with 22% using them in a
enhanced analytics, but also eliminating inefficiencies significant way
by strategically applying process automation, artificial

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