Technology provides efficiency, knowledge and timely information. With the adoption of technology, brokers can be trusted advisors at the table, rather than transactional agents. It is the role of a broker to provide liquidity, transparency and the best return for a property.
Residential real estate brokers – think single-family homes – have quickly embraced technology as a symbiotic partner while commercial real estate has fallen behind. Today, the adoption of technology will propel sophisticated commercial real estate companies forward and leave them slow to adopt new practices in pursuit of the curve. Technology will most certainly have a significant effect on the operations of commercial real estate brokerage firms.
Like individuals in many other industries, real estate professionals and brokers in particular have been reluctant, skeptical and worried about adopting new tools that could apparently put them out of work. Think of stockbrokers: their day-to-day operations today are totally different from what they did 20 years ago, but their work is also improved and more efficient thanks to technology. And it’s not like they’ve lost their jobs because of technology – quite the opposite. Technology has complemented their fiduciary role to clients, their relationships and their market knowledge – now they are better brokers because they have embraced the role of adviser in its true sense. These same reasons apply to commercial real estate brokers and why technology will only strengthen their jobs without jeopardizing their careers.
Technology will help brokers spend less time working on trades and more time providing advice and building stronger relationships with clients. We all know that technology increases the number of eyeballs on a list; However, converting those site visits to offers and navigating through the offerings and due diligence rounds requires a relationship and communication between buyer and seller. The relationships necessary for these roles are a skill that brokers cultivate over time and something that technology cannot replace.
Market knowledge and consulting skills
While technology will make rent collection and financial modeling more efficient and less time consuming, brokers will always be needed for their industry knowledge and advisory skills. While there are many data providers, finding the information you need for a rental survey or offer memorandum takes less time. There are even newer platforms that use predictive analytics and machine learning to not only deliver the data to you, but also to take it to the next level of decision-making. The algorithms will help brokers analyze more trades in less time by quickly removing outliers. Whether determining what the optimal rental price should be or which apartments are really tradeoffs, brokers will always need to look at the auto-filled answers and provide their expertise to clients on what other sources are saying and what. ‘they think is the correct answer.
Brokers play a key role as trustees of their clients. A broker provides third-party mediation and intimate knowledge of the market. It is the duty of a broker to obtain the best price and the best possible conditions for his client. If we have learned anything from off-market transactions, it’s that the buyer, not the seller, has the advantage. A broker should represent the best interests of the seller, while respecting the buyer, bringing both parties to a final offer and then to closing. All the nuances required of a fiduciary role make it hard to think that technology will ever replace it.
Brokers will have to evolve their activities to integrate new tools into the market or they will be left behind. How much time do you spend on tasks that are not directly related to getting a contract and making a deal? From CRM to marketing automation to data accessibility and automated analytics, technology tools, it’s like having a bigger team without having to hire additional support. These tools also give you more time to do what you do best: broker. It is better to take the lead in adopting new technologies than to run to catch up.