COMMENT Over the past 10 years data has become an invaluable commodity to industries like finance and banking, healthcare, retail, travel, and entertainment. Indeed the value of data in speeding transactions, aggregating consumer tastes, analysing trends, and informing strategic planning, has repeatedly led to it being labelled the ‘new oil’. When it comes to commercial real estate however, data usage is still very much in its infancy. So what exactly is holding the property industry back?
Many landlords are still wrestling with fundamental questions: Why is data important? How do you gather it? How do you understand it? And what can you do with it? For the last eight years we have been helping clients using our market-leading tenant experience platform, to answer these questions and embrace the transformative power of data across their portfolios.
At the outset, it’s important owners are clear about their aims for gathering data. Which issue, obstacle or challenge are they trying to solve? Which operations or processes are they trying to improve? Having a clear purpose in mind makes it easier to gather truly meaningful data. However, it is also the most responsible way to gather data. Data centres drain enormous amounts of electricity and produce similar levels of carbon emissions to the global aviation industry. At the current rate, experts estimate that data centre energy usage could comprise over 10% of the global electricity supply by 2030. Being smart about what data you need to gather is not only the most effective way forward, it’s also the most environmentally responsible.
Once owners are clear on their purpose, my advice is always to get started, whether by passively monitoring building activity through an AI or IoT solution, or actively gathering data through surveys and polls. Of course, consent and transparency are paramount, but the reality is that it takes time to gather data and the sooner you start, the more valuable data becomes in the long run.
Landlords we have been working with for the last eight years, have built up rich, valuable data sets that now allow them to compare and contrast their operations with previous years, months and days. This intelligence empowers them to improve their asset management strategies, make smarter investment decisions, supercharge their tenant engagement, and attract and retain tenants more easily.
Numbers and statistics in and of themselves, however, add zero value. Landlords need the right tools in place to analyse raw data and process it into meaningful, informative intelligence. This need has resulted in significant growth in the real estate data analytics market, with the likes of Gyana and Reonomy just two examples of companies helping landlords unlock meaning from data. Our own Equiem Analytics feature not only captures data, but processes it into rich, actionable intelligence for landlords. Digestible dashboards answer simple questions like who is in the building and which facilities are used most, through to more complex questions like which amenities provide best ROI and turn most revenue, and how does tenant interaction with the building change over time.
Ultimately, this kind of intelligence only becomes truly effective if it informs and promotes a change of practice or vindicates an existing practice. Once gathered and analysed, owners must look at how they can revise and improve their offer in response. This may mean taking a fresh look at planned investments in a building, revising a tenant engagement strategy, changing a building’s retail mix, or simply meeting with a particular tenant to address any issues spotted.
Commercial real estate is changing fast. Tenant demands, uses of space, lease lengths and the way in which buildings are now marketed are all evolving. In the face of such enormous disruption within the industry, data can provide the intelligence landlords need to respond seamlessly and effectively. With an agile, effective data strategy in place, landlords can gather information, make necessary changes, test the effectiveness of those changes, and then repeat the process. This ultimately improves their offer, minimises financial risk, and maximises ROI. It is the reason why we have made tenant analytics such a core part of our own offer, and it should be the reason why every landlord has thought through their own approach to data too.
Gabrielle McMillan is chief executive of Equiem
