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If commercial real estate lags behind residential in adoption of technology, it’s not for lack of investment in the sector. In the first half of 2021, equity and debt investment in U.S. proptech totaled $8.5 billion, surpassing the total amount of capital invested in 2020, according to GCA, an adviser in the proptech market.
“The biggest challenge we face is [lack of] data sharing,” said Deena Zimmerman, vice president at SVN Chicago Commercial, during a proptech panel at the National Association of REALTORS® C5 Summit Monday. “In this business, people still keep information close to the vest. Landlords will say to me, please don’t tell CoStar what we leased this space for. People need to realize, when we share data, it helps all of us.”
Zimmerman is not only a sharer but a zealous advocate for technology. While her company subscribes to CoStar, she said she’s also a fan of Crexi, a commercial listing platform that offers a discount to NAR members, and REALTORS® Property Resource, where commercial practitioners can research properties and market areas and find deep data on more than 1 million active commercial listings and 55 million off-market properties. There’s no cost for NAR members to use RPR. It’s a benefit of membership. She also uses ArcGIS from ESRI and SitesUSA to help tenants do site selection.
Having access to such tools routinely help Zimmerman beat out larger real estate companies in her tenant rep business, she told the C5 Summit audience. In one instance, adding an RPR trade market report to a proposal led to an hour-long discussion with a potential client. No other broker had offered near that depth of information, she said. She won the business and earned a sizeable commission.
Other panelists echoed Zimmerman’s comments and offered reassurance to brokers nervous about taking the plunge into new, potentially disruptive technologies. “Brokers are here to stay, and brokers are essential to the transaction,” said moderator Ashkan Zandieh, entrepreneur-in-residence for NAR REACH Commercial.
“New technology has leveled the playing field,” said Andrew Flint, co-founder of Occupier, a lease-management solution and 2020 REACH Commercial company. “I spent a lot of time at JLL, where we had access to platforms not available to smaller firms. Today, if you’re a five-person team, you can be up and running with this stuff within two weeks.”
Tyler Thompson, vice president of Second Century Ventures, said the pandemic has helped speed up the adoption of technologies. “The best brokerage teams out there are saying, ‘How can I leverage this stuff to boost my team?’” he said. But bringing transaction management to commercial real estate remains a challenge. “It’s a bigger problem to tackle in commercial [compared with residential] because every deal is different.”
What every commercial broker should be thinking about is the customer experience they’re providing compared with experiences consumers have in other industries, Thompson said. “On the commercial side, there’s a lot of work to be done.”