Future-Proofing CRE: The Top 5 AI Every Smart Investor Should Use

Being a smart investor in commercial real estate (CRE) demands more than just savvy investments and deep market insights; it requires embracing the latest in technology, as well. As artificial intelligence (AI) becomes a game-changer in the industry, its impact on operations, decision-making, and strategic planning cannot be overstated. A study by McKinsey Global Institute…

Written by
Gelyn de Castro • March 13, 2024
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Being a smart investor in commercial real estate (CRE) demands more than just savvy investments and deep market insights; it requires embracing the latest in technology, as well.

As artificial intelligence (AI) becomes a game-changer in the industry, its impact on operations, decision-making, and strategic planning cannot be overstated. A study by McKinsey Global Institute predicts that AI could potentially deliver an additional economic output of around $15.7 trillion by 2030, with businesses that adopt AI early expected to share a disproportionately large portion of the economic gains.

This evolution isn’t just about keeping up with the competition; it’s about leveraging AI to uncover new opportunities, enhance efficiency, and predict market trends with accuracy.

For CRE investors, particularly, the stakes are high. The CRE Innovation Report highlights this sentiment, noting that nearly half (49%) of commercial real estate executives recognize the potential of AI to drive operational efficiencies and substantial budget savings. Furthermore, 43% of these executives anticipate AI will have a highly disruptive impact on the industry.

In this article, you will get to know the top five AI tools that every smart investor should incorporate into their workflow, ensuring that your approach to CRE investing is not just current but future-proofed for the dynamic shifts on the horizon.

With the potential of AI to transform the CRE landscape, staying informed and adaptable is the new currency of investment success.

1. Generative Video in Commercial Real Estate

Generative video technology, powered by AI, is transforming property visualization in commercial real estate, offering unprecedented capabilities for creating high-definition virtual tours, property modeling, and assessing space utilization.

This technology leverages AI to generate realistic video content, enabling potential buyers, tenants, and investors to explore properties in a detailed and immersive manner without the need for physical site visits.

Virtual Tours

AI-generated videos have transformed the way we experience property listings through the creation of dynamic virtual tours. These immersive tours provide a 360-degree perspective, offering an authentic sense of the property’s space, layout, and design in stunning high definition.

According to a recent Realtor.com statistics report, listings featuring virtual tours garner up to 87% more views compared to those without. Furthermore, the report indicates that 54% of buyers are likely to bypass listings lacking virtual tour options.

Real estate agents have turned to platforms such as Zillow, Animant, Anax for property searches. Zillow has now expanded its repertoire by introducing the innovative 3D Tours Generator, specifically tailored for interior design showcases. This tool exemplifies the cutting-edge AI real estate solutions that streamline the workflow, enhancing the promotion and sale of properties.

The 3D generator harnesses the power of AI to create detailed virtual tours, providing an invaluable asset to real estate businesses. Its efficiency shines particularly in the commercial real estate sector, where investors require quick and cost-effective virtual tours of expansive properties. This tool not only meets the demand for speed and affordability but also delivers a comprehensive visual experience that can influence investment decisions.

Property Modeling

According to a report by Goldman Sachs, the real estate VR market is set to skyrocket to $2.6 billion by 2025.

This projection emphasizes the significant investment and interest in technology that enhances property visualization, including generative video for property modeling. Such tools not only aid in marketing but also in the planning and development phases, offering a cost-effective way to explore and present property transformations.

Space Utilization Assessment

Assessing space utilization is another area where generative video technology shines. It can simulate different layouts and usage scenarios, helping property managers and investors optimize space efficiency. Whether it’s reconfiguring office layouts for better workflow or demonstrating the potential of retail spaces, generative video provides a tool for exploring various configurations without the need for physical alterations.

2. AI Tools for Marketing

AI tools have become game-changers, providing investors with unprecedented capabilities to tailor content, optimize messaging, and engage with their audience in more personal and efficient ways. Leveraging artificial intelligence, businesses can analyze vast amounts of data to identify patterns and preferences, enabling hyper-personalized marketing strategies that resonate with individual consumers.

Below are examples of AI marketing tools:

Jasper.ai

For CRE investors, Jasper.ai can transform the way they create and disseminate brand-specific content. By ensuring that all messaging aligns with the investor’s brand identity and directly appeals to the target audience, Jasper.ai aids in creating a consistent and compelling brand image. This can be especially valuable in:

  • Developing targeted marketing campaigns for different real estate listings or investment opportunities, ensuring that the messaging resonates with potential investors or buyers.
  • Creating informative and engaging content for blogs, newsletters, or social media, positioning the CRE investor as a thought leader in the industry.
  • Automating content creation for market analyses, investment reports, or case studies, saving time and resources while maintaining high-quality outputs.

Phrasee

The specialization of Phrasee in AI-generated content for email, push notifications, SMS, and social ads offers CRE investors a powerful tool for direct marketing and client engagement. By leveraging natural language processing and machine learning algorithms, Phrasee can:

  • Optimize email marketing campaigns to potential and existing investors, ensuring that messages are crafted to yield high open and conversion rates.
  • Enhance the effectiveness of push notifications and SMS campaigns for property listings or investment opportunities, driving more engagement and responses.
  • Tailor web, app, and social ad content to capture the attention of a broader audience, increasing the reach and impact of marketing efforts.

Voicebooking

The ability of Voicebooking to convert written text into AI-generated voice files opens new avenues for CRE investors in terms of content diversity and accessibility. This technology can be applied in:

  • Creating audio content for property tours or investment opportunity presentations, allowing potential investors to receive information in a more engaging and convenient format.
  • Developing podcasts that discuss market trends, investment strategies, or insights into the CRE industry, further establishing the investor’s credibility and expertise.
  • Implementing automated customer service systems or voice-guided assistance for inquiries related to properties or investments, enhancing the customer experience.

These AI marketing tools offer innovative ways to automate and refine content creation, enabling businesses to scale their marketing efforts while maintaining a high level of personalization and brand consistency.

As AI technology continues to evolve, we can expect these tools to become even more sophisticated, further revolutionizing the landscape of digital marketing.

3. Autonomous AI Agents in Commercial Real Estate

Autonomous AI Agents are advanced, intelligent systems capable of making decisions and taking actions independently, without human oversight. They operate by interpreting vast amounts of data, applying machine learning and complex algorithms to derive insights, and executing tasks with a degree of autonomy that mirrors human decision-making.

These agents can range from simple automations with predetermined responses to sophisticated entities capable of learning and adapting to dynamic environments, whether physical or digital.

How CRE Investors Can Use Autonomous AI Agents

  • AI-Agent-Driven Property Price Valuation: Autonomous AI agents excel at estimating property values by analyzing comprehensive market data, sales history, and trends. For CRE professionals, this means:
  • Data-Driven Accuracy: Leveraging vast datasets, these agents can uncover patterns and insights that inform accurate valuations.
  • Comparative Market Analysis (CMA): Utilizing their analytical prowess, AI agents conduct thorough research and comparisons to aid in property valuation, offering real-time market insights.
  • Real-Time Market Monitoring: By tracking live market data, AI agents provide timely valuations that reflect current market dynamics.
  • Feedback Incorporation: These agents validate their estimations by integrating feedback from real estate experts, refining their accuracy.
  • Visualization and Reporting: AI agents can present their findings in clear, concise reports, simplifying the decision-making process for CRE professionals.

Smart Capital Center has harnessed the power of autonomous AI agents to transform the CRE industry. Our AI-powered platform facilitates an environment where AI agents take the lead in property valuation, tapping into extensive databases to assess and predict property prices with remarkable accuracy. The agents conduct in-depth comparative market analyses, constantly monitoring the pulse of the market to deliver valuations that are both current and grounded in comprehensive data analysis.

Moreover, Smart Capital Center understands the synergy between human expertise and AI accuracy. Our platform is designed to incorporate professional feedback into the learning of AI process, ensuring that the valuations and reports generated resonate with the realities of the market and adhere to industry standards.

In practice, this means that CRE professionals equipped with Smart Capital Center tools can rely on AI for more than just raw data processing. They receive validated market analyses and property valuations that are enhanced by visualizations and detailed reports. 

These insights empower users to make informed decisions, secure in the knowledge that the information they’re working with is not only generated through powerful computational methods but also vetted for accuracy and applicability.

4. Natural Language Models and Interfaces in CRE

The intersection of commercial real estate and artificial intelligence (AI) is rapidly becoming a hotbed for innovation, particularly with advancements in natural language models and interfaces. One standout example of this technology is GPT-4 (and future versions) developed by OpenAI, which is transforming how CRE professionals interact with data and clients.

GPT-4, the latest iteration of the Generative Pre-trained Transformer models, offers a leap forward in natural language understanding and generation. With its enhanced ability to comprehend context, reason through complex queries, and exhibit a degree of creativity, GPT-4 is an invaluable tool for CRE investors and professionals. It can interpret and draft legal documents, analyze and summarize market reports, and engage with potential clients through written communication with unprecedented sophistication.

GPT-4 and interfaces such as ChatGPT can be transformative, enhancing both the efficiency and quality of professional tasks.

For CRE professionals, the ability to quickly digest extensive documentation is crucial. 

GPT and other advanced natural language models are adept at summarizing and analyzing a vast array of written materials, including dense web pages, lengthy PDFs, and various scanned documents. This can dramatically reduce the time spent by investors and analysts in reviewing property portfolios, market analyses, and due diligence reports. Such AI-driven summarization ensures that key information is not overlooked and that CRE professionals can make well-informed decisions faster.

Another area where natural language models excel is in the generation of new documents. For instance, investors can assist in drafting preliminary investment memos, market reports, and even detailed proposals for property development.

By providing a structured draft as a starting point, these AI models allow CRE professionals to focus on refining the strategy and content rather than starting from scratch. This is particularly beneficial for smaller firms or individual investors who may not have the same resources as larger entities.

The Limitation

While natural language models offer remarkable capabilities in generating and summarizing content for commercial real estate professionals, they are not without their limitations.

A significant constraint is the potential for inaccuracies in the outputs. For instance, when dealing with complex financial documents, there may be instances where the AI misinterprets figures or subtotals, which could lead to wrong conclusions.

This limitation highlights the necessity of a meticulous review process, particularly when accuracy is important in CRE transactions and analysis.

Smart Capital Center recognizes this limitation and has positioned itself at the forefront by integrating GPT-4 within its services. By doing so, Smart Capital Center offers accurate and interactive analyses that go beyond static reports.

Smart Capital provides more dynamic analytics, enabling users to craft their real-time, data-driven insights. This integration guarantees that the computational power of GPT-4 is finely balanced with the precision and relevance that Smart Capital Center’s platform is known for.

The result is an enhanced user experience where CRE professionals can rely on AI for heavy data processing while also trusting that the final output has been vetted for accuracy.

This approach ensures that the insights and materials generated are not only quick and efficient but also reliable and tailored to the unique requirements of the users.

5. AI Copilots in Commercial Real Estate

AI copilots in commercial real estate represent the next step in decision-support technology. 

Functioning akin to having an expert by your side, these advanced AI systems are capable of accessing data and providing insights based on user-directed queries. The idea is to augment human expertise, not replace it, ensuring that the intuitive and strategic prowess of CRE professionals is complemented by data-driven support from AI.

Financial Modeling and Intelligent Insights

AI copilots transform the financial modeling process by minimizing the guesswork involved in creating forecasts and projections. Traditionally financial analysts rely on a blend of historical data and assumptions to predict future financial performance. With an AI copilot, these assumptions are vetted against vast amounts of market data, offering a clearer picture of their realism and potential outcomes.

Key applications include:

  • Data-Driven Projections: AI copilots can quickly process extensive datasets to evaluate the validity of financial assumptions, delivering stronger foundation for financial models.
  • Customizable Inputs: They allow for adjustable parameters, accommodating the unique variables pertinent to each organization or investment scenario.
  • Enhanced Accuracy: By leveraging machine learning, AI copilots help in generating more precise financial projections, tailored to the organization’s needs.

Predictive Analytics in CRE

Predictive analytics is another area where AI copilots are proving invaluable. According to a Deloitte report, significant financial risks for CRE investors such as geographic market risk, tenant risk, and finance/interest rate risk can impact growth and profitability.

AI copilots can sift through extensive real estate data, some of which is publicly available or can be acquired, to forecast future market conditions and investment hotspots. This predictive power can:

  • Identify Profitable Investment Areas: AI analyzes current market performance and uses machine learning to pinpoint locations likely to yield high returns over the next decade.
  • Reduce Investment Risks: With the ability to process and analyze large datasets, AI copilots offer more accurate assumptions, lowering the risk associated with investments.

At Smart Capital Center, we embrace the concept of AI as a copilot for investors. Our platform integrates AI copilots to assist in financial modeling and predictive analytics, empowering users with tools that extend beyond traditional analysis methods.

  • Streamlined Investment Processes: By inputting specific investment criteria, users can leverage AI to identify and evaluate potential investment opportunities quickly.
  • Real-Time Data Analysis: Our AI copilots are continuously updated with the latest market data, ensuring that users have access to the most current insights for their analyses.
  • Reduced Margin of Error: With the accuracy of AI, the likelihood of investment errors is significantly reduced, providing a layer of confidence in decision-making.

Let Smart Capital Center guide you through this transformation. Book a demo today.

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Smart Capital is the world’s first real-time valuation and mortgage platform. It empowers real estate investors with institutional-grade insight, unbiased investment analysis, ultra-fast property valuation & deal underwriting, low-cost transaction support, free portfolio monitoring, and capital to enable smart investment decisions and fast dealmaking.
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