How data is changing the world of commercial real estate, with Rob Finlay
As if large competitive industries weren’t complex enough, the global pandemic has shaken up the commercial real estate industry. For real estate agents, brokers and investors, the recent freeze in the residential real estate market has caused panic among both buyers and sellers.
To keep the trends and performance of residential and commercial real estate stable, everyone has turned to data analysis. Today’s world has become dominated by technology, and commercial real estate companies are no exception. Rob Finlay, Founder and CEO of thirty capitals, understands it better than anyone.
Commercial real estate development companies (CREs) similar to Finlay’s are turning to technology to streamline their operations and generate greater profit for investors. Here’s how the big world of data analytics and technology has affected CRE’s investment opportunities:
Predict market trends and consumer behavior
“Data analysis is not just about reacting to trends; it can also be to predict them, ”Finlay explains, discussing the benefits of data analysis. “The use of this technology to predict consumer behavior and market trends is revolutionary in itself, and people should take advantage of it.
From monitoring home equity and tracking mortgage payments, to matching that information with a home’s age and owner’s lifespan, data analysis can help agents focus. and examine future trends. This data can be used to recognize when someone is preparing to sell their home, as well as to analyze new leads in the commercial real estate market.
Even tracking income levels and job changes can help brokers and investors predict where foreclosures might be on the horizon. It can also help them determine areas where prices could go up or down, and how to attract certain customers to a new opportunity.
Develop the industry and the use of AI
For decades, humans have studied the science behind artificial intelligence (AI) and how to use its power in major industries today. Understanding these benefits can pay off for your commercial real estate company.
Deep learning, or a subfield of machine learning involving the brain’s artificial neural networks, has contributed massively to the expansion of AI. In the tech world, the development of AI is an incredible human achievement.
Predictive analytics is combined with other analytical tools to make an accurate decision about investment methods. For example, portfolio managers can analyze consumer behaviors to determine potential buyers or sellers of homes in a certain area.
AI also has the advantage of analyzing a large amount of information while eliminating human bias. By integrating AI into investment methods, commercial real estate now has a competitive advantage in the market.
CRE’s refusal to use data analysis
If there are so many benefits to using data analysts, then why are so many CRE investors refusing to use it? Some investors are simply not aware of its many benefits, or even how to use it within their business.
Research and collection can take some time, and company superiors may find that market-related data does not meet certain specifications. In addition, they might consider the time and effort required to obtain this data to be unnecessary.
In other cases, managers and investors may not have the means to examine and study the data. It takes a lot of work to effectively analyze the data and verify it and then further determine if it is even suitable for their investment process.
Some managers think that data analysis tools are not worth the effort and subsequently choose to hover over the data instead of analyzing it to the extent that they need it. Additionally, obfuscated data can present problems and alter potential returns on investment (ROI) assessments.
How CRE Companies Can Use Data Analytics Today
Changing the culture within an already established industry can be quite difficult, and it’s easy to see why real estate brokers and investors might be skeptical at first.
Such a change requires a certain level of cooperation and communication, and you can’t expect everyone to understand. To convince an entire organization of its benefits, the leaders of that organization must promote the idea of new data analytics.
“At Thirty Capital, we understand how technology and data analytics can play a crucial role in commercial real estate investing, ”says Finlay. “Our team of professionals works to combine this type of revolutionary technology with our experience to help our clients increase their profits.
Integrate AI, for example, is just one way to raise the stakes in your investment strategy, and commercial real estate investors should be able to share that effectively. While many might think that AI is just a sophisticated way to automate specific tasks, understand that achieving a data-driven mindset is critical to the future success of an organization.
If investors don’t put enough emphasis on data, organizational cultures cannot successfully leverage this technology in ways that benefit the business.
The era of innovation
A few years ago, CRE brokers and agents devoted considerable time to researching and evaluating properties and market trends in order to accurately answer invert and buyer questions.
But today, companies like Thirty Capital are learning to use data analysts to their advantage. “Now, with these innovative new methods of data analysis, we can save time and money dramatically and completely simplify the process,” says Finlay.
This allows agents to focus their attention on connecting with their clients and helping them get a more accurate view of a property and its potential.