By Bruce Ford
The line between business and technology has blurred as our world becomes even more connected. The commercial real estate industry continues to adapt to immense shifts in work culture, business operations, access to information, and globalization.
The cliché approach to commercial real estate – “location, location, location” – is quickly evolving to reflect changing priorities for business leaders. There have been broad shifts within the workplace stemming from younger employees entering the workforce, changing economic drivers, historically low unemployment, flexible working hours, and working remotely, just to name a few factors. Now more than ever, businesses need their real estate to reflect their employees’ wants and needs rather than simply being a space to operate.
Catering to Modern Business Models
Today’s business models have adapted to the changing demographics of the current workforce. To be successful, commercial real estate companies must look at what drives a client’s business to identify the best location. Employees are no longer impressed by corner offices or large board rooms. To attract and retain top talent, businesses are more heavily considering what’s outside the four walls of their space. Hence the trend of entire cities creating live/work/play areas to lure corporations.
While a prime location can make or break a business, it can also mean higher rents and inefficient space use. The role of real estate advisors has evolved beyond simply presenting available spaces, the majority of which may not be a good fit for the client. Instead, they must give clients a more personalized idea of what the market has to offer for their specific business and employee base. This consultative approach, grounded in a holistic understanding of a client’s short- and long-term goals, helps advisors pinpoint ideal locations in which a business can thrive – a significant shift from a primarily transaction-driven history.
With troves of information readily available, the key to unlocking value is distilling trends, identifying opportunities, and anticipating client needs. Real estate data is difficult to quantify since pricing and appraisals are affected by more than just the cost of goods used to construct a property, underscoring the importance and potential of big data.
Combining data with powerful new technology can provide a broader understanding of the market and drive better decisions. For instance, for a specific area, commercial real estate firms can compile information on buying and selling trends, quantify the amount of commercial development, map traffic patterns and demographic shifts, process consumer survey results and more.
However, simply having the data is not enough; it’s how the information is utilized that makes a difference. Evaluating multiple data points to form a complete view of the market effectively narrows the list of potential properties, making the decision-making process for clients more efficient. Serving a client’s entire business, rather than only its real estate needs, is how firms achieve a positive outcome and repeat clients.
As the trillion-dollar real estate industry evolves into a modern consultancy business, the importance of understanding, organizing and distilling data, and then translating it into potential outcomes for owners and occupiers, cannot be overstated. Just as business leaders focus on their access to customers, the productivity of their employees, and future growth and recruiting, so should the real estate firm they choose as a partner. Balancing location, people and data to find a solution that satisfies both employees’ expectations and overall business objectives is the focus of today’s innovative service providers.
As President – East Region, Bruce Ford oversees operational excellence, client service delivery, and business development initiatives for the commercial services business in 11 offices across Massachusetts, Florida, Georgia, Tennessee, Maryland, Virginia, New Jersey, New York, and the District of Columbia.