How often do you go and meet your tenants or clients? Sit down, talk to them, find out their needs and improve your service according to this invaluable feedback? Once a quarter sounds about right, doesn’t it?
Now be honest with yourself — almost nobody actually does this that frequently, speakers said at Bisnow London’s AI Revolution in Commercial Real Estate event.
“There’s just a lot of busy work, a lot of toil that ties you to your computer, and at the end of the day, by the time you get all that done, there’s not a lot of room left to do the strategic relationship-building,” Re-Leased CEO and founder Tom Wallace told an audience of 200 at The Ministry flexible office space.
Bisnow/Mike Phillips
LCA’s Seth Oberlander, Related Argent’s Jack Sibley, Pi Labs’ Stefania Ponzo, Re-Leased’s Tom Wallace, Concrete Ventures’ Dominique Gonfard and KPMG’s Brian Duren
Artificial intelligence could solve that.
Generative AI has the potential to transform business models and allow individuals and companies to leapfrog entire stages of their evolution, moving into new sectors in weeks or months rather than years, for instance.
But that remains some way off — not necessarily for technological reasons, but for prosaic ones, like complications over professional indemnity insurance. There are also bigger issues, like the fact that greater transparency brought about by AI might not be good for the profits of incumbent businesses.
The first stage of AI implementation is what Wallace refers to as reducing toil — small, menial tasks that may only take five or 10 minutes each but add up to a serious time suck. Wallace said the risk of handing over this work to a computer is similar to the common practice of giving it to junior associates at the start of their career.
The list of such tasks is almost endless, but reviewing leases and other contracts was most cited at the event — comparing the leases of tenants in a building during acquisition due diligence might take weeks for a human but can be done in minutes by AI, for instance.
Then there is AI that allows industry professionals to iterate different scenarios or strategies quickly and efficiently in worlds as diverse as design or investment underwriting.
Pi Labs partner Stefania Ponzo gave the example of a Norwegian company in which the VC firm has invested called Laiout, which allows users to design different floor plans for an office or factory in seconds based on different criteria for the end user. That might previously have taken a consultant days or weeks, and the technology allows people to more easily imagine new uses for previously obsolete buildings, she said.
At the moment, however, the real estate sector is far from seeing widespread adoption of AI technology, be it large language models such as a GPT, specifically designed tools or agentic AI, the next innovation coming down the track, in which AI programmes undertake tasks on behalf of a company such as answering customer emails.
“We see lots of firms where they’ve got one analyst or an asset manager who’s kind of passionate and interested in it, and they’re using [Microsoft] Copilot on his phone,” Related Argent Head of Proptech and Innovation Jack Sibley said. “They’re like, ‘Why can’t I do more of this stuff in a corporate setting?’”
Maximising the productivity benefits of AI takes time and money, and in that sense, midsized firms are perhaps best placed to take advantage. Small firms don’t have the time or money to invest properly. Big firms can easily become mired in bureaucracy. Firms in between the two can dive in and catalyse their growth.
The kind of accelerated deep research into new markets that AI can perform could change the nature of real estate, allowing companies to be far more nimble. But that isn’t necessarily a change that all will welcome.
“Real estate’s made quite a lot of people very rich throughout history, because it’s a very nontransparent market,” Sibley said. “So there is an interesting longer-term piece. I remember a senior director earlier in my career telling me, ‘Jack, you keep talking about the lack of transparency like it’s an issue.’”