The following is a contributed article from a content partner of Benzinga
At first glance, the real estate industry doesn’t seem particularly tech-reliant. Buildings go up, bought and later sold, and land and properties acquire and lose value like any other commodity. Aside from the digitization of directories and contracts, and the fact that estate and letting agents now do most of their trade online, the industry has remained inherently unchanged for many generations. But dramatic changes are now starting to manifest, in real estate as in the wider world, and technological innovations are paving the way for real estate’s long overdue evolution. Here are six ways in which smart tech is permanently altering the face of real estate.
Branded Real Estate
Branded real estate is a concept that has quietly entered the mainstream, with branded projects doubling in the past decade according to the 2019 Spotlight report. What is it? In essence, it’s about transforming and differentiating physical structures using well-known brands, their touch and influence. In this way, a featureless building can be transformed into a living art piece, with the ideas of architects, artists and contractors converging to elevate the property. via contemporary art.
LightArt is one of the startups beautifying residential and commercial properties using contemporary art. They have created landmarks from New York to Berlin, with each design crafted according to the local surroundings. Founded by Tom John Or-Paz, former head of FashionTV’s branded real estate division, the company works in tandem with construction firms and artists to make properties more attractive to investors, tenants and home-buyers, as well as to the general public. While the branded real estate concept might not seem overly technological on the face of it, it’s reliant on computer-aided design and modeling, while Big Data also plays its part.
“People have always looked for something extra when purchasing real estate,” says Or-Paz. “For years real estate has been based on square metres and concrete walls. With the modern world and its changes, people are demanding more, and branded real estate seems to answer that desire. The global epidemic that hit the world this year has pushed the desire to get more value for money.”
As well as leveling up residential properties, branded real estate could be “one of the best options to add value to commercial real estate,” insists Or-Paz.
Smart buildings – also known as intelligent buildings – leverage Internet of Things (IoT) technologies and sensor-generated data to control and regulate systems such as ventilation, lighting and heating, delivering eco-efficiency from the ground floor up. Seen as a means by which we can all reduce our carbon footprint and achieve energy sustainability; the smart building market is expected to hit $127 billion in 2027.
The European Union (EU) is one of many authorities to have written directives aimed at enhancing buildings’ energy performance and interconnectivity, with the Energy Performance of Buildings Directive (2014) stipulating that all new buildings must be “nearly zero-energy” by the end of 2020. From the perspective of real estate companies, smart buildings deliver a host of benefits particular as far as buyers and tenants are concerned: not only do they benefit from better connectivity but also higher retention rates. The information they transmit could also be seriously profitable in the years to come. According to a Deloitte research paper, “Over time, there is potential for the information generated by IoT-enabled buildings to be as valuable as the location of the physical asset.”
In July, Samsung and Microsoft joined forces to help drive improved building operations and maintenance, while creating richer experiences for both service technicians and residents. The alliance will utilize Microsoft’s Azure IoT platform and productivity cloud services alongside Samsung’s smart devices and SmartThings platform.
The introduction of AI means that realtors no longer need to be, well, real. With most homebuyers or renters making a property website their first port of call, an increasing number of real estate companies have introduced conversational AI solutions to answer queries, address pain points, schedule viewings and match consumers with their dream home. Speaking in an engaging, humanistic “voice,” chatbots’ interactions rely on insights gleaned from historical conversation logs, making them an efficient gateway in the selling process. Hyro is just one conversational AI platform building up a database of tech-minded property giants.
The events of 2020 have made property visits untenable for many. Even those who do manage to arrange a physical viewing are expected to wear masks and latex gloves, with the experience more akin to crime scene investigation. Virtual viewings have thus come into their own, giving prospective renters and buyers the opportunity to size up a property from a distance. Interactive and immersive 360º walk-throughs also give buyers who might be unable to physically view a property – whether due to work or their living far away – an opportunity to vet a prospective purchase. The great thing about virtual viewings, of course, is that they can be performed at any time of day or night and don’t require a physical agent to walk you around. AI-powered chatbots, meanwhile, can be on hand to answer any questions.
In recent years, drones have been popularly used by developers to plot out construction sites, monitor building work and prepare sites for inspections. They can also be put to work scanning rooftops with thermal imaging cameras to identify areas of heat loss. The use cases are numerous, of course, since drone footage can also be used by real estate businesses to highlight a value proposition to buyers; this is especially the case with larger properties whose vastness can only truly be appreciated from above.
Blockchain – the distributed ledger technology (DLT) commonly associated with bitcoin – has many uses in real estate. One is to record ownership and transaction certificates on a public ledger, making real estate transactions simpler and quicker while also more secure. Seoul-based investment platform Fund Bloc is just one business pursuing this strategy, converting real estate funds into digital assets.
Another investment firm, Max Property Group (MPG), interacts with blockchain via a child chain on Ardor’s multi-chain platform. A blockchain-based property funding startup, Max Property Group leverages DLT to offer fractional ownership of real estate developments. MPG received regulatory approval last month.
Blockchain doesn’t just provide technological rails for transaction settlement, of course. It’s also the technology powering Decentraland, a virtual platform where participants can buy and sell pieces of digital land and set up VR businesses. The metaverse even has its own digital asset, MANA. Of course, it requires a few imaginative leaps to connect the gamified world of Decentraland with the actual real estate industry. But if metaverse style projects are able to monetize virtual land, you better believe real estate companies will be taking notes.
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