Bringing the Commercial Real Estate Industry into the 21st Century
June 21, 2021 • Thought Leadership, Commercial Real Estate
This article was originally published in Silicon Hill News.
By Kenny Tomlin
It’s difficult to believe that the Commercial Real Estate (CRE) industry has continued to operate in essentially the same manner the past 15 years, considering how much technology has advanced and significantly improved most industries. Yet, even the most technically savvy brokers still run their business through a combination of PDFs, Excel spreadsheets, text messages, and email.
One of the primary reasons the CRE industry hasn’t modernized their method of working is because the solution simply hasn’t been there to drive change the way it has for other industries — for example, when a tenant rep broker reviews commercial options for new clients (tenants) looking to lease space, it is a very manual and time-laborious process spread out over many tools and tasks with disparate data having to be pieced together into a word doc or pdf that is non-dynamic with poor usability. Let’s break this down in very familiar terms. Now, imagine that Amazon was merely an online catalog of what could be purchased instead of the super powerful commerce and transaction engine it offers today. Remember what catalog shopping used to be like? Frequently, the price of the item wasn’t included and only a short description and a few photos were provided. The purchase process was often a nightmare as well and might have included contacting the seller to receive pricing, availability, and shipping costs. What a pain!
Out with the Old: Wheel-Reinvention is a Must
Stepping back into the past is a good way to understand how tenant rep brokers utilize the primary data source in most of today’s CRE transactions. The traditional and generally accepted tactics in today’s CRE pipeline give those involved in the process a general but woefully incomplete view of available options. What results is a dysfunctional and disconnected flow of emails and phone calls between the tenant rep, broker, and the leasing agents, who put together a market survey for the tenant. It sounds like it might 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 to consider.
The slow, laborious, and not at all future-forward CRE transaction process continues with the tenant rep preparing to email his or her client the aforementioned “market survey” along with a spreadsheet of financial metrics and links to something like a Dropbox that contains the leasing agent’s marketing flyers, floor plans, and property photos. Imagine how much time is wasted going back and forth between the tenant and tenant rep with these static documents, amongst multiple stakeholders responsible for the leasing decision.
CRE Transactions for the 21st Century and Beyond
So, how can we reinvent the wheel? What if the CRE industry stepped into the 21st century with technology that creates a centralized platform that benefits all stakeholders (tenant, tenant rep, leasing agent, and landlord)? The results would be astronomical. Gone would be the days of back-and-forth emails, tedious Excel spreadsheets, and pointless PDFs. The whole process would be expedited, meaning clients and landlords would be much happier as tenant reps and leasing agents close more deals.
Think about it. Enhanced 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 bring that “aha!” moment where one stops to think “why hasn’t it been done this way all along?”
But, is the global CRE business community ready for this type of disruption? Put bluntly, YES. With the right technology, every CRE transaction would be easier than it currently stands. Technology has been adopted into nearly every aspect of the human experience, so it’s finally time for CRE industry professionals to wake up and keep up — what do they have to lose?
