How asset managers can drive the digital revolution in commercial real estate

April 16, 2024

As a market leader in building analytics software, CIM sits at the intersection between cutting-edge technology and commercial real estate. From this vantage point, we’ve seen a significant shift in the role of asset managers in executing the digital transformation of their property organisations.

According to JLL’s 2023 Global Real Estate Technology Survey, a staggering 91% of commercial real estate occupiers are willing to pay a premium for tech-enabled space, with clean energy solutions expected to have the greatest impact on real estate over the next three years. Brookfield UK has taken their focus on tech a step further, launching Advanced Research Clusters (ARC) to foster innovation and stimulate commercial growth by clustering tenants around major scientific and research hubs.

The real estate industry has become a leader in adopting ESG frameworks and encouraging innovation that enhances environmental sustainability. With substantial efforts, this sector has been at the forefront of making the built environment greener and more sustainable. Technology has played a critical role in this transition, facilitating green energy solutions and helping to enhance efficiency at every level of asset operations.

In this post, we’ll explore the various ways asset managers can help drive the digital transformation within their organisations.

Create a plan to manage data at scale

Data is the key to unlocking the full potential of a property, portfolio, team, or decision-making process—but even the best data is only as helpful as a team’s ability to interpret it. The question to ask, as Adam New shared in our webinar on Embracing Data and Digitisation, is: “What does the data tell us we should be doing?” If your team can’t answer that question reliably, start there.

Making sense of data at scale is a skill—one that requires the right tools and technology to convert all that data into insights. Increasing data literacy is a core focus for firms like CBRE and Lendlease, which increasingly rely on large streams of of data to make informed decisions.

Propelled by a vision to harness the power of a digitised Office portfolio, leading property group Charter Hall has been reaping the benefits of an operational model driven by data and technology since establishing a partnership with CIM. A common industry challenge is maintaining access to a uniform data set across expansive property portfolios. For Charter Hall, consolidating the data from 13 different providers into CIM's single platform has simplified access for all stakeholders to a consistent set of portfolio-wide insights. This empowers the team with greater oversight across the entire portfolio, enabling data-driven decision-making that adds value nationally.

Cultivate a culture of openness

Fostering a culture that embraces technological innovation is vital for asset managers who want to bring their firms forward into the digital age. An over attachment to ‘the way things have always been done’ can entrap asset or operations teams, preventing them from adopting transformative technology at pivotal moments.

This process should involve engaging all stakeholders at every level, from senior executives to on-site teams, and clearly communicating how new technologies can enhance their efficiency and move the needle on broader organisational goals.

In our recent conversation with Caitlin Koskinen, CIM’s Senior Enterprise Account Executive, she reminded senior leaders to be mindful of team perception.

“There are teams who are highly eager and prepared for change, but others are quite resistant,” she said. “This resistance often stems from a fear that technology might render their job redundant or overrule their expertise. But this is not our intention at all; rather, we aim to facilitate their work.” 

Address potential resistance up front by clarifying to on-site teams that the mission of proptech is to make asset management easier and more efficient, not to displace them.

Make people your priority

Commercial real estate isn’t consumer-facing in the traditional sense, which may explain why the industry has been slower than some to adopt new technology. Without a consumer-driven demand for change, the impetus to spend on tech often isn’t strong enough.

In Part 2 of our interview with Caitlin, she suggested that customers have begun driving that demand for change with measurable impact. She also noted that people—not computers—will make or break the successful adoption of any software solution. “Having frictionless technology that empowers employees to do their jobs better and more efficiently while aligning to a common mission is not just how you adopt technology. It’s how you transform your organisation,” she said.

Davina Rooney shared a similar perspective on the importance of a people-first tech culture with an analogy about incentivising change via the carrot, the stick, and the tambourine. Where the sticks are regulatory bodies and the carrots are incentives like Green Star ratings, tambourines are a culture of collaboration to ensure lasting success. 

Don’t miss the low-hanging fruit

Managing commercial buildings still often involves a surprising degree of manual effort where current-state technology offers considerable efficiencies. It’s not uncommon for teams to fly to another city to perform manual audits on large assets—a task easily automated with technology.

Compliance reporting on energy consumption provides another example of a quick win. In some cases, landlords collect bills from numerous tenants across multiple assets to manually compile the energy consumption data required for ESG reporting each month. Building analytics technology can create these reports with a click of a button, saving valuable time and effort.

Automation technology in commercial building management both streamlines operations and frees up valuable human resources to focus on more strategic tasks, such as tenant engagement and building optimisation

In some cases, the low-hanging fruit technology brings within reach comes in the form of insights. Managing and maintaining asset oversight at the portfolio level can help asset managers make informed decisions about where to direct both capex and focus, closing the gap at their lowest-performing assets and improving efficiency portfolio-wide.

Operate buildings more sustainably

In the face of escalating environmental challenges and growing regulatory pressures, REITs are increasingly turning to technology to manage their assets more sustainably. Advanced technology solutions have proven pivotal in this transformation, enabling asset managers to not only meet sustainability targets but also to drive significant operational efficiencies and energy savings.

Building analytics software such as CIM’s PEAK Platform exemplifies how technology can enhance sustainability in the built environment. PEAK helps operational teams identify opportunities to improve plant and equipment efficiency, reduce downtime, manage carbon footprints, and ensure overall operational efficiency. By integrating data from systems and sensors across all zones, floors, and tenancies, PEAK provides a holistic view of a building’s performance, highlighting opportunities to optimise energy consumption without compromising tenant comfort.

Insights derived from building analytics also enable REITs to make informed decisions that align with their overall sustainability goals. For example, by analysing patterns in energy consumption, asset managers can identify plant and equipment that can be optimised rather than replaced, extending equipment lifespan and maximising capex.

Ready to lead the future of property with digital transformation? Discover the power of CIM’s PEAK Platform—request a callback today!

Murad Dalbah
April 16, 2024