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A commercial real estate blog post for NAIOP

POSTED ON SEPTEMBER 29, 2021 BY ROCHELLE BRODER-SINGER

Commercial real estate and construction have been notoriously slow to adopt new technologies. But digital transformation is coming to the industry. At CRE.Converge 2021 in Miami Beach, experts discussed how several new technologies are affecting developers, builders and owners:

Reality capture technologies allow you to see and/or record what’s happening at a job site, whether remotely or in-person. This includes robots, drones and various automated cameras, as well as sensors and other data-gathering devices – all connected to the internet.

For instance, HITT Contracting, Inc., now has three to four types of robots on its job sites. One is a rover the company developed to support projects that can span 200 to 300 acres. It reduces the time human team members spend running up and down stairs and driving out to other parts of the project to answer questions or look at something. Other robots allow superintendents to see what’s happening at one job site while they’re physically at another site, helping to solve problems quickly and efficiently.

HITT is now working on deploying robots at night to capture project status and data and upload it directly to the project model. In the future, they will tie that data into the financial system. The goal is to automate a very labor-intensive and manual process.

While many employees initially resisted the robots, said Megan Lantz, vice president, research and development at HITT Contracting, Inc., they are seeing their value and now ask for them on their sites. “It allows them to do what they love to do, which is to really get in there and solve problems,” she explained.

Data and analytics are a significant pain point for many companies in the real estate industry. “All of these companies now have a lot of data and they don’t know what to do with this data – and it’s not changing anything about the way business is done,” said Bryan Colin, CEO of technology firm View Labs. “They’re spending all this money for all this data and these platforms and they either are not looking at it or don’t know what to do with it.”

Lantz agreed. “We have 75% more data points than we did three years ago,” she said, yet the company is still trying to figure out how turn the data into meaningful insights.

A single dashboard of data remains a goal that eludes too many real estate companies. For instance, a few years ago, HITT found itself with a couple dozen tools to gather data at worksites, but none connected to each other. “We’re still in that digital transformation and looking at that pain point and how to solve it,” Lantz said. “It will take another couple of years for us to get there.”

Still, a single dashboard can facilitate faster transactions and surface new opportunities. Too many large companies rely on a broker to keep track of all their assets and report to them once a month, Colin said. He added that any technology solution has to be implemented and used throughout the company and at every level. “You have to mandate it for everyone,” he said. “You can’t have silos, because then nothing interconnects. … All of the most effective solutions that spread and have real value are company-wide and focused.”

Electric vehicles (EVs) have seen a significant increase in ownership during the past five years, but charging infrastructure is lagging. EV chargers may be required by a municipality in a new development or requested by tenants. Either way, installing them typically requires “conversations with municipalities and walking developers through new code requirements that may or may not be realistic,” said Jose Manuel Correa, PE, a civil engineer at Kimley-Horn. Quite a bit of coordination, time and money goes into their installation, and there is no clear answer yet about the ROI on EV charging stations. “What I can say is that there are a number of heavy hitters right now that are investing millions of dollars into the EV and EV charging market,” Correa said.

EV readiness is top of mind for many property owners, despite the lack of clarity in ROI. It’s less expensive to install the infrastructure for EV charging when a commercial building is built, even if charging stations aren’t in the immediate plans. Correa advises clients to talk with their energy utility as early in the process as possible to determine whether the local grid has charging capacity. Charging station planning can be a five-year or even 10-year process with the utility, allowing the property and the grid to ramp up in tandem.

Tips for Success

Digital transformation requires careful change management. A few tips for success:

Talk about what you’re doing and be as transparent as possible about failures and successes.
Drive home why you’re making these changes.
Implement any technology solutions company-wide, including at the leadership level.
Involve employees at all levels in choosing and implementing technology.
Consider internal innovation competitions in which the company funds winners – but be prepared for some innovations to fail.

This post is brought to you by JLL, the social media and conference blog sponsor of NAIOP’s CRE.Converge 2021. Learn more about JLL at www.us.jll.com or www.jll.ca.

Rochelle Broder-Singer is an independent business writer and editor with more than 25 years of experience. Through the lens of her background and training as a business journalist, she writes about commercial real estate, economic development, compliance-related topics and more. Connect with Rochelle on LinkedIn at www.linkedin.com/in/rochellebroder or on Twitter at @rochellebroder.