One of the country’s largest commercial real estate brokerages is boosting its big data strategy with a major tech hire.
Colliers International tapped Jake Edens as its new head of technology and innovation strategy. Edens is the founder of REscour, a platform that marries available public commercial real estate data with a company’s proprietary data. Colliers also partnered with REscour last month.
“REscour will be one of many projects we’ll have on the horizon,” Edens said.
Edens will be based in Colliers’ Atlanta office, where he plans to build up his technology team to run the firm’s entire efforts. One of Edens’ goals with Colliers will not only be to digitize the day-to-day paperwork minutia of real estate deals, but also harness the thousands of daily data points that Colliers gathers across its network and analyze that to the benefit of the firm’s clients. That kind of data is what customers are demanding more and more of, Edens said.
“This is the way of the future, and we want to get ahead of it,” he told Bisnow. “Soon all CRE decisions will be heavily data driven rather than gut feelings or best practices. Therefore, Colliers is prioritizing data collection, developing cutting-edge technologies and using predictive analytics when possible so that our clients have a competitive advantage in the market.”
It may be about the future, but for commercial real estate brokers, it may also be about remaining relevant, JLL International Director David Kollmorgen said.
“Our industry is scared to death about being disrupted by some new technology,” Kollmorgen said. “We don’t want to be ‘Uberized,’ if you will.”
The threat that automation can minimize the importance of a broker is real. A recent report from the U.K. by the Royal Institute of Chartered Surveyors found that nearly 90% of the core tasks for real estate consulting are susceptible to artificial intelligence, the Internet of Things and blockchain.
“Surveying appears to be an industry in which 88% of the core tasks are ripe for automation to a greater or lesser degree,” the report said. Surveying is a catch-all term for everything from investment and leasing brokers to property managers, appraisers and construction consultants.
“It’s probably about survival,” said Werner Krebs, a data scientist who also is CEO of big data consulting company Acculation. His company is often tapped by real estate firms for help, Krebs said.
No matter the vertical, automation and software can save a company 10% of its operating costs. Krebs said he is seeing a variety of areas in which commercial real estate is enhancing its tech for a variety of business functions, from qualifying and automating sales leads and marketing efforts to creating more accurate predictive real estate valuation models and even the use of virtual reality in creating and analyzing buildings or new developments.
“All Fortune 100 companies are seeing the benefit to data science,” Krebs said. “There’s going to kind of be a scramble to build up that [talent] in-house.”
Indeed, real estate companies are already scrambling to hire tech experts to incorporate new software and apps and to crunch the data. Venture capital firms dropped $12.6B on real estate tech firms in 2017, a huge spike from the $4.2B invested in those types of offerings the year before. It is a fast-moving game, and it means hiring and recruiting the right people can be particularly challenging.
“Data is the new oil … it’s going to power everything that we do,” Silverstein Properties Chief Information Officer Sandy Jacolow recently told Bisnow.
Colliers sees hiring Edens — whose REscour was named by technology conference Venture Atlanta as one of the top five startups to watch in 2016 — as a way to remain competitive with other national commercial real estate firms.
“The business is obviously changing, and having superior talent and technology will continue to be a differentiator for Colliers. We expect the impact of technology on this industry to grow in the coming years. Having someone like Jake at Colliers provides us with the type of leader that understands that impact and will help Colliers continue to lead the industry. Jake will help provide a strategy around interpreting data as simply having data is no longer enough,” Colliers President Marty Pupil said in an email.
Ultimately, tech can also free up brokers from the day-to-day paperwork of real estate deals to focus more on being a data expert, Kollmorgen said. And that will make them more valuable to clients.
“The brokers have to move up the value chain. All of that manual labor of preparing RFPs, issuing RFPs, all that has to be automated,” he said. “And then that pushes the broker … to a lot more strategic and a lot more value-add [role]. That’s really going to be a key focus of ours.”