Bringing the Commercial Real Estate Industry into the 21st Century
From Kenny Tomlin, Founder and Executive Chairman of AnthemIQ
It’s hard to believe that the commercial real estate (CRE) industry has functioned in essentially the same way for the past 15 years, considering how much technology has advanced and vastly improved most industries. But even the tech-savvy brokers still run their business using a combination of PDFs, Excel spreadsheets, text messages, and emails.
One of the main reasons the commercial real estate industry hasn’t modernized the way it works is because the solution just wasn’t there to drive change like it is in other industries – for example, when a tenant agent broker is considering commercial options for new customers (tenants), who want to rent space, this is a very manual and time-consuming process, spread across many tools and tasks, having to merge different data into a Word document or PDF that is not dynamic and with poor usability. Let’s break this down in very familiar terms. Now imagine if Amazon were just an online catalog of what can be bought instead of the super powerful trading and transaction engine it offers today. Do you remember how catalog shopping used to be? Often times the price of the item was not included and only a brief description and a few photos were provided. The buying process was also often a nightmare and might involve contacting the seller to find out prices, availability, and shipping costs. What a pain!
Out with the old: wheel reinvention is a must
Stepping back in time is a great way to understand how tenant agent brokers use the primary data source in most CRE transactions today. The traditional and widely accepted tactics in today’s CRE pipeline give those involved in the process a generic, but pathetically incomplete, view of the options available. The result is a dysfunctional and incoherent flow of emails and phone calls between the tenant representative, broker, and landlords doing a market study for the tenant. It sounds like it could be comprehensive, but it is literally just a very long and tedious PDF list of available commercial spaces that are potential options for the tenant.
The slow, arduous and by no means promising commercial property transaction process continues while the tenant representative prepares to email his customer the aforementioned “market survey” along with a table of financial metrics and links to a sort of Dropbox containing the lease to send marketing flyers, floor plans and real estate photos to the agent. Imagine how much time is wasted using these static documents to switch between tenant and tenant representative between several parties responsible for the rental decision.
CRE transactions for the 21st century and beyond
So how can we reinvent the wheel? What if the commercial real estate industry entered the 21st century with technology that creates a centralized platform that benefits all stakeholders (tenants, tenant agents, leasing agents, and landlords)? The results would be astronomical. Gone are the days of e-mails back and forth, tedious Excel spreadsheets and pointless PDFs. The whole process would be expedited, meaning customers and landlords would be much happier if tenant representatives and leasing agents closed more deals.
Think about it. Improved technology that streamlines CRE transactions would bring speed, convenience, transparency, and personalization to the transaction process. It would be like the Uber of the CRE world – using it would say “Aha!” The moment when you stop thinking, “Why wasn’t that done the whole time?”
But is CRE’s global business community ready for this type of disruption? Quite frankly, YES. With the right technology, any CRE transaction would be easier than it currently looks. Technology has been carried over into almost every aspect of the human experience, so it is finally time for CRE industry professionals to wake up and keep up – what have they to lose?
Editor’s Note: This is a guest post on the Silicon Hills News