Disruption in the property industry is on the horizon, if not already here, as new technologies provide richer, data-driven intelligence. How will this affect the traditional agent, asks Georgina Power of MIPIM UK.
To what extent will agents become advisers rather than just surveyors, as technology frees them up to focus on what they do best – building partnerships, building trust and negotiating?
The combined forces of the internet, mobile technology and big data are heralding big change – a change that will have a far-reaching and profound impact on the property industry.
Agents will become obsolete, reads the media. Such headlines may turn heads, but to quote Winston Churchill: “A pessimist sees the difficulty in every opportunity; an optimist sees the opportunity in every difficulty.”
Opportunities of 4IR
We are in the Fourth Industrial Revolution, the 4IR, where new technologies are fusing the physical, digital and biological worlds. And greater change is to come, via artificial intelligence and more.
Fast-evolving new technologies, whether big data or AI, are impacting and will continue to impact the role of property agents. It may mean the end of the ‘traditional’ agent, but disruptions can be ‘innovative’, presenting opportunities.
Disruptive innovation creates new markets by discovering new categories of customers and clients. For the property agent, it can open up new ways of adding value for clients.
March of the start-ups
The focus so far has been on the wave of proptech startups disrupting the transactional market in the residential sector. These new companies are using technology to enhance and in some cases replace traditional agency services.
Will the same happen in the commercial sector? Many proptech companies have set their sights on expanding in the commercial market, attracted by the big-ticket transactions. They may not find it so easy. The residential market is consumer facing, and it is the consumer who usually drives innovation. But one thing is certain about new technology – it produces lots of surprises.
Look at it through a different lens and these proptech start-ups are building new tools for the industry. They are making the market more transparent and efficient, and, in some cases, kick starting traditional agency practices to use the tools of digital data platforms to compete with the proptech companies themselves.
The building and advance of digital data platforms is having the most profound impact on the property sector. It’s about how data is collected and analysed, in real time, anywhere and at a touch of a button.
These data platforms can, among other functions: streamline how space is found, with the use of intricately tailored search criteria; organise viewings via virtual reality; and speed up negotiations, with special software reducing the time needed to debate a lease.
The roll-out of sensors is also enabling everything from buildings to transport systems to be connected to the Cloud. This has greater implications for asset management, but it will in turn affect returns for investors and how projects are designed and developed.
AI on its way
The next big step for big data is through the evolution of artificial intelligence. AI will mean that machines will be able to use algorithms and mathematical models to skim through data in nanoseconds to discover patterns. AI is still in its infancy, but it’s on its way, with big changes due in the years to come.
All this is happening at a time when some agents are still using Excel spreadsheets and antiquated tech platforms.
With challenges come opportunities
This is an exciting time for the property sector. To move forward, it is fundamental that the industry analyses and discusses these challenges and how they can be turned into opportunities.
Agents can use these new technology tools to offload the burdensome work and to help them take their business to a new strategic level. This access to data real time will provide that competitive advantage. The freeing up of time also opens the doors of opportunity to offer new services.
These digital platforms will help to ensure that capital is invested in the right project in the right place, hence reducing portfolio risk and operating more efficiently. They will bring more transparency to the market, providing reliable, useful and instantly accessible information.
Property remains a people business
Especially as you go further up the value-chain, in the realm of deals worth millions of pounds, and with the rise of the global investor, there’ll always be demand for professional advice from an agent at the top of his or her game, with many years of experience in the market’s intricacies.
The commercial property sector has always been in essence a people business. It’s about building relationships, building trust and negotiating. This is what attracts many people to the industry.
We cannot isolate the property sector from advances in AI, and neither will the clients of agents want to be denied the added value from such advances. It is about adopting an innovative approach to these new technologies; reviewing them, analysing them and monitoring them, and identifying where the strategic opportunities lie.
MIPIM UK 2017 is holding a dedicated session, ‘Long Live the Agent!’, under the theme of this year’s Conference Programme, ‘UK Real Estate – The Next Chapter’. This dedicated session will provide agents and their clients with a platform to discuss their future role, how to make the most of the opportunities that lie ahead and how to face the challenges.
MIPIM UK 2017 takes place on 18-19 October at London’s Olympia. The event also includes a special Investors’ Summit. Click here to register.
- Georgina Power is editor of MIPIM UK