October 10, 2019
The real estate industry landscape continues to evolve at a rapid pace, yet if CRE companies want to remain competitive heading into 2020, it will be critical for them to update their mindsets. The latest Deloitte 2020 Commercial Real Estate Outlook predicts they will need to focus beyond the adage, “location, location, location,” but also on tenant experience. The key to this notes Deloitte is to leverage insights from data analytics and emerging technologies.
According to the report, real estate companies should consider the following to make more informed location decisions and create more memorable tenant experiences over the next 18 months:
– Executives predict tech investments will remain on track despite a possible recession. Interestingly, more than 70% of CRE executives – particularly PERE investors/managers, developers and property managers – are likely to stick to their plans to maintain or increase overall technology investments even if an economic slowdown occurs.
– CRE organizations acknowledge growing demand for smart buildings. IoT-enabled buildings and mobile apps can be game changers for CRE firms; more than half of respondents believe investing in facilities with “smart” capabilities, such as those controlling lighting or room temperature, are critical to enhancing tenant experience. CRE execs expect smart buildings to become mainstream within a few years, so it will be important to increase smart building portfolios in the next 18 months.
– AI adoption has room to grow. AI is in the early stages of adoption in the CRE industry, and companies have yet to develop a deeper understanding of how to use it effectively. However, leaders predict investments in AI will increase – 63% plan to use it in the future.
– Tenant privacy is becoming a top priority for CRE executives. 45% of organizations have developed in-house cyber resilience capabilities to limit the exposure of private data and the potential impact of a data breach. The number climbs to 70% for respondents whose companies have increased tech investments focused on tenant experience.
For comments, questions or concerns, please contact Dennis Kaiser