Each year, the Urban Land Institute’s annual Emerging Trends in Real Estate Report offers a glimpse into the real estate landscape. No matter what your role in the industry — buyer, seller, investor, technology company, broker or owner — keeping an eye on these trends means bettering your ability to play in the field.
There are three big technology trends on this year’s list that really stick out. Blockchain, augmented reality, and the connectedness of cities are poised to shape not only the domestic commercial real estate market — but international markets, as well.
How will these trends truly impact the market? Where will they go in 2017?
1. Blockchain and the Modern Real Estate Market
Blockchain is one of those technologies that can seem rather complex, but it’s set to impact real estate in a big way. Essentially, blockchain is the encrypted digital data technology that runs Bitcoin, the virtual currency. There are indeed people buying real estate with Bitcoin currency, but it isn’t quite mainstream yet. Is this residential trend going to take off and will it set the tone for where commercial real estate is headed?
Jon Schultz, an avid CRE tech influencer, recently wrote an article cautioning the CRE world to pay attention to blockchain. He believes, while the implications for CRE may not be immediately apparent, the blockchain technology itself (what drives Bitcoin) could really shake up the industry.
“Imagine being able to create ‘smart contracts’ that automatically execute when a predetermined set of circumstances occurs,” he says. “These would in effect be self-enforcing, thanks to the transparency of the system. Consider the possibilities of invoices that pay themselves when a shipment arrives and share certificates that automatically send their owners dividends if profits reach a certain level. All of this with virtually no chance of error.”
2. Augmented Reality Continues to Drive to Mainstream
Virtual reality / augmented reality isn’t new to the commercial real estate industry. It has, however, been increasingly more popular and we expect it to turn into the norm in 2017. As 3D imaging and virtual reality become more prevalent (and affordable), we’re sure that VR/AR will be used more often as a showing tool.
Imagine a building that’s under construction, or even just a blueprint, with VR/AR a potential client could “view” the property before it’s even a reality. This will be particularly useful for catering to international tenants, buyers, or investors who may not have the time to travel to view prospective properties.
3. The Connectedness of Cities Soars
Our cities are becoming more and more connected thanks to the Internet of Things and advances in “smart city” technology. Imagine a world where sensors can help increase energy efficiency, building maintenance, and control operations all based on patterns and data.
Much of this is already happening today, but as this technology continues to advance and become more mainstream, it will further impact the real estate sector. Technology is continuing to advance and by the end of 2017 the commercial real estate market could be impacted in ways that we may not be able to imagine today.
What are You Watching?
What technologies are you watching as 2017 continues to roll on? We’d love to hear from you in the comments below, or on our Facebook page. Let’s keep the conversation going.