Relax your shoulders.
Okay, that’s better.
It’s a wild time to be in real estate.Every morning you wake up to your phone roiling with alerts and notifications. Local, national, and global real estate news lurches you from one story to the next.
And as a real estate leader, you’re being called to make sense of this chaos. Gone are the days of “key economic indicators” predicting dynamics and trends when you could take time with your team to investigate and prepare to mitigate, hedge, and manage.
Now, you must make decisions in the blink of an eye.
For commercial real estate owners, portfolio values fluctuate as we try to make the big decisions about which properties to keep, which ones to double down on, and which ones to give back to the lender. For enterprise and corporate real estate portfolios, decisions on cost reduction through real estate consolidation or real estate expansion with company growth are taking up headlines daily. These decisions used to be made on purely financials, often with little other empirical data. A seasoned veteran would say, “Yea, pencil those numbers!” and we would all clinkcocktails and hope for the best. Someone that sounded credible would make a proclamation and everyone would say “hmm... yes of course. Very much so. Letus continue onwards and upwards, what could possibly go wrong?... ‘’
But, back then, you didn’t have access to all the data and information you needed to make better decisions based on the true operations of the asset.
Data Eats Real Estate
Real estate needs to bring more than just financial data front and center and integrated into the daily core business of real estate, workplace operations, and property value. A healthy set of financial metrics is limited since your financial data only tells you so much about the purpose of your spaces, the operational health of your buildings, and the current and future value of your real estate portfolio. Since real estate is going through a new chasm for the first time in our history, we need to dive into the ground operations. Think about it, multifamily housing was not imagined to be 24/7workplaces and offices were not imagined to be operating at 25% occupancy and data centers were not imagined to handle this new AI explosion.
Real estate is fundamentally changing.
Going back to financials, let’s look at two of the biggest expenses of any organization: labor and leases. People and spaces. Payroll and occupancy costs.
But you don’t really know where the people are going and how they are interacting with the spaces and systems in each property. What’s happening right now? How does it compare to last week? What does it tell me about what might happen in the next two weeks?
You simply don’t have the full picture.
Your Real Estate Problem is Actually a Data Problem
If you were in any other industry, you wouldn’t be able to keep a straight face and say you didn’t know the full details behind two of your biggest expenses.
Take an industry like manufacturing. There are obvious, understandable metrics that tell you production efficiency, quality, and performance – the operations for people and spaces - not just the financials. Yield, throughput, downtime, turnover… all measurable and standardized across factories, vendors, and the entire industry.
What if you had the same visibility about your real estate portfolio?
Your financial data only tells you where the money is moving through your properties. It doesn’t tell you how the people are moving through them.
You need the second half of the puzzle.
Operational Data is the Key
For landlords, understanding how tenants are interacting with their space is the key to predicting whether a tenant will renew or break their lease. For enterprises, you can’t have a workplace and real estate strategy without a workforce plan. After all, culture is symbiotic with physical spaces. For both of these key scenarios, understanding your operations is critical. Up until now, the ground operation was up to the local manager. And as long as the financials rolled up, everything worked.
But that’s not the case anymore. Today, it is necessary to create spaces that people want to be in – whether its tenants or employees. In order to do that, you need to know what spaces people use, when they use it, how they use, and why they use it. Then you have to activate that space so it supports those needs. And that requires data - from building systems, sensors, people experience, and enterprise software.
On top of it all, budgets are shrinking, costs are rising, and we still need to cut a massive amount of energy consumption by the biggest culprit of greenhouse gas emissions. This is a lot for anyone who owns or runs real estate.
If you had to manually get that data on a granular basis, you would need every space to be someone’s full time job. So, the only way toget this data is to capture data from a variety of sources, normalize it, structure it, merge it, and then analyze it. The data streams from building automation/HVAC, access control, card readers, occupancy sensors, desk sensors, indoor air quality sensors, thermostats, ERP (Enterprise ResourcePlanning) software, lease data from PDFs, reservation inventory management software (Microsoft365 or G-Suite), visitor management software, and so on. Each of these systems stream data in different intervals, have different data formats, with different identifiers making it difficult to bring this together.In addition, if there are any updates to the underlying software, there could be disruption to the data flow.
However, the adoption of smart building technologies has begun to allow systems to become integrated and automated. These interactions help optimize building operations, creating a network of interconnected devices that communicate and exchange data.
Additionally, each of these systems generates a constant stream of data. Most teams have only spotty or incomplete access to this operational data.
With more accessible operational data, better decision-making is now possible, benefiting both new and retrofitted buildings.
But how do we get there?
Data Applications Live or Die on Data Access
It is difficult to gather data from all the systems that you need. Without this data, you can’t make timely, informed decisions.
Most of a building’s systems and software aren’t designed with interoperability in mind. Vendors would rather lock you in for recurring revenue, and that sweet upsell than play nice with the other systems that would give you a more complete picture of operational dynamics.
Trying to get a clear view of the health of your entire real estate portfolio feels like assembling a puzzle with half the pieces missing. You're forced to cobble together data from disparate reports and systems, each with its interface and data format. It’s like a horror movie called Night of the CSVs
That's why a centralized, unified view of your real estate is critical to alleviating the pain points that keep you up at night worrying about the metrics that keep you busy all weekend.
For example, you might have five different access control vendors across 23 properties. You could be asking someone on your team to be spend 2-5hours a week to aggregate badge swipes across your portfolio. That’s could cost you upwards of $2,000 per month. A unified data approach would normalize these data sets so they can be seen in one holistic view. This centralized view of data also helps to:
Stop Runaway Costs: If you want to compare energy usage across all of your space, a unified view makes sure the energy data is cleaned up so you can compare to data sets. You would be able to see that one office in Seattle consistently uses twice the energy of the other office across the street. But you wonder why because both buildings have an energy efficiency program running. What you don’t know is that one property is actually adjusting their HVAC manually to occupancy trends, where the other ones run it off scheduling. With a complete dataset, this would allow you to identify root causes and implement targeted solutions..
Future-Proof Your Data: Buildings and technology are constantly evolving which means that you don’t want to constantly be updating your integrations. Business leaders must stay current with new practices and systems by integrating them into their existing infrastructure. A centralized platform provides a foundation for easily integrating future innovations as they become conventional practices.
By unifying your smart building data, you can trade information overload for actionable insights. It's a powerful tool for optimizing operations, reducing costs, and keeping your entire portfolio running like a well-oiled machine.
Context is King
Even if you can wrangle all this data, how are you going to see it in context? Who decides what even comprises context? Is that even good enough?
If your FP&A team and/or data science teams are overloaded (and most are), your requests for reports and analysis are in the queue waiting their turn. Or they are contributing to job frustrations. Meanwhile, markets and trends are shifting. By the time you get the reports, derive the insights, figure out how to adjust strategy, and implement the strategy, the opportunity to act may have passed.
An insight isn’t very actionable if it’s 3 weeks old. A truly useful real estate data platform needs to help you move faster. You need to avoid:
Data Expertise Gap: Delays happen because you may not have the data expertise to understand the reports generated by your data science team fully. And the data science team doesn’t have the real estate context for them to pull fully functional analyses. General BI tools are designed to analyze data across various industries. Real estate data, however, has its own unique set of KPIs and caveats. Occupancy rates, energy consumption, and tenant/employee satisfaction surveys all require specific context to be truly useful. Purpose-built real estate applications understand these nuances. They present data alongside industry benchmarks, historical trends, and even external factors like weather patterns. This contextualization helps you identify actionable insights you might miss with a generic BI tool.
Stuck in the Setup: You could spend all your time customizing and fine-tuning a general-purpose BI tool, but they must be tweaked and optimized to real estate software. Real estate applications are designed with your specific needs in mind. Dashboards and reports are pre-configured to highlight key metrics relevant to real estate operations. This allows you to drill down into specific areas of interest quickly and easily without getting bogged down in data wrangling.
Working the Workflows: Real estate applications can also be integrated with other property management systems and software. Imagine identifying an underutilized conference room through a unified view of your space. A real estate data application could allow you to adjust air quality settings or send alerts to relevant teams. This seamless integration streamlines workflows and facilitates data-driven decision-making.
In conclusion, while general-purpose BI tools can be valuable assets, they don't provide the depth and context needed to unlock the power of real estate data. By investing in purpose-built real estate applications, you can gain a holistic understanding of your portfolio, confidently make data-driven decisions, and future-proof your operations for success in the ever-evolving real estate landscape.
Meet Your New Virtual Data Analyst
We have to talk about AI, LLMs, generative AI and all the rest. AI has completely changed the relationship between users and their data. How is it bringing value to real estate data applications?
See the Unseeable: AI and machine learning can quickly evaluate massive complex data sets, finding outliers, anomalies or confusing analyses that might indicate a lack of efficiency. This also includes algorithms that can proactively detect and find these curious data blips and show them in full context for further investigation. For example, a sudden spike detected in energy consumption in a specific building prompts you to investigate potential equipment malfunctions… or maybe it’s just another hot summer in Chicago, and everybody’s in the office on a Wednesday.
Personalized Data Views: AI-powered analytics can also adjust to who the end user is and what they’re likely ask based on their job role, region, or other criteria. A REIT asset manager will have different data questions from a Head of Operations. Data applications like this continually improve the more you see them. Or it may know the types of buildings you keep an eye on and adjust its reports and dashboards automatically.
Talking is the New Code: If getting all your data centralized and sorted in one place is the Achilles heel of a real estate data application, then user adoption is where you stub your pinky toe. Most data analysis products require a fair amount of training and know-how to start to use. Generative AI technology like ChatGPT and Google Gemini are quickly becoming the translator between what the end user says they want and the output they are trying to get (this is called natural language processing). Simply ask a question, and the agent or bot retrieves and interprets relevant data, presenting it clearly and concisely.
When more people can ask more questions and gain more insights, you foster a data-driven culture that improves decision-making and operational efficiency, which provides a competitive edge in this tempestuous real estate market.
What if you had a tireless virtual data analyst always on call, always at the ready, from any device anywhere? They can answer the big existential questions about leases and returns or go look up a tiny detail because you’re stuck on the train and just curious. An AI-powered assistant offers immediate access to powerful insights, answering real estate (context-specific) questions.
So talk to your data. It has a lot to say.
Smart Buildings, Smarter Decisions
As markets ebb and flow, streamlined access to accurate, timely data presented in full context is more important than ever. With a unified view of your financial metrics and the operation data from your properties, you can have a comprehensive picture of the value.
Real estate teams and business leaders that adopt a strategic approach to their real estate and digitize their operations will be better positioned for success.
The time for smarter data applications is here.
We Just Happen to Do All That
Savvy by Cohesion is a real-time real estate data analytics platform built for business leaders like you. It unifies all your data from disparate systems so it’s ready for analysis and insights. Fine-tuned business intelligence capabilities show your data in full context for deeper understanding. And Savvy ships with the world’s first virtual data analyst for real estate, always at the ready - whenever you’re ready.
Ready? Learn more about Savvy or schedule your demo today.
p.s. Relax your shoulders again.
