Generative AI in CRE Investment and Asset Management

The buzz around Generative AI is reaching a fever pitch, and for good reason. This transformative technology is poised to reshape entire industries, and commercial real estate (CRE) investment is no exception.  As the leader in AI powered underwriting and asset management, Smart Capital has intimate understanding of the potential and what works already today. …

Written by
Gelyn de Castro • April 17, 2024

The buzz around Generative AI is reaching a fever pitch, and for good reason. This transformative technology is poised to reshape entire industries, and commercial real estate (CRE) investment is no exception. 

As the leader in AI powered underwriting and asset management, Smart Capital has intimate understanding of the potential and what works already today. 

To share its insight, the Smart Capital team hosted an oversubscribed Lunch and Learn event during the recent RETCON 2024 conference. The event focused on how to leverage Generative AI in CRE Investment and Asset Management. 

Despite the heavy downpour, our event in the heart of New York City drew a diverse crowd of top property investors and developers. Many attendees represented notable companies such as, Equity Residential, LaSalle Investment Management, CBRE Investment Management, Canadian Imperial Bank of Commerce, among many others. 

The presentation at the Smart Capital Center Lunch and Learn stood out distinctly. Focused on the actual technical aspects of GenAI infrastructure, it delved into the most up-to-date strategies, techniques, concepts, and practical applications. Unlike other presentations that skim over generic applications of AI, this session was particularly technical, offering practical advice directly from seasoned experts in the field, making it especially valuable for CTOs attending RETCON. 

One of the attendees commented, “With these insights, the Smart Capital Center Lunch and Learn clearly leads as the most compelling AI presentation at RETCON, diving deep into actual practical applications today and technical how-tos.”

Drive ROI and Cut Transaction Costs with GenAI  

  • Unlocking the Potential of Generative AI: The discussion of Lunch and Learn explored the latest AI tools, such as GPT-4, Google Gemini Advanced, and Anthropic Claude 3, which are at the forefront of foundational models of Generative AI. It was also discussed how these tools can be tailored to support smarter CRE decision-making. 

An attendee remarked on the depth of this presentation, saying “This was more than just a presentation; it was a masterclass in the practical applications of AI in real estate, detailed and thoroughly engaging.”

  • Driving ROI: Generative AI drives investment ROI by providing a unique lens for pinpointing opportunities and optimizing strategies. Its ability to analyze immense amounts of data goes beyond traditional methods, uncovering patterns and correlations that signal high-potential investments. This includes identifying areas primed for strong returns, highlighting assets ripe for repositioning, and predicting potential market fluctuations to mitigate risks. 
  • Cutting Costs: Attendees were introduced to how AI is the real estate transaction process, offering significant time and cost savings through automation, enhanced due diligence, and streamlined document generation. This efficiency can also be attributed to the exponential growth of GenAI infrastructure, with technology such as Retrieval Augmented Generation (RAG) leading the charge. 

RAG addresses the limitations of the context window of AI by enabling AI systems to automatically pull in new context from external sources, such as the internet or internal documents. This capability allows AI to “google” information relevant to a task, thereby improving its understanding and response capabilities and enriching its contextual awareness. The development and optimization of this infrastructure, particularly for Large Language Models (LLMs), have led to the creation of a comprehensive ecosystem. This ecosystem includes tools and applications tailored to enhance RAG functionality for specific use cases, encompassing data creation and cleaning, optimization of RAG retrieval for improved speed, quality of output, and cost efficiency, as well as thorough performance evaluations

The AI Frontier: Uncharted Possibilities 

Smart Capital Lunch and Learn emphasized the rapid evolution of Generative AI, where the best tools and approaches require hands-on exploration to uncover. It’s a space where human expertise augmented by AI yields the most significant results, as demonstrated by consultants leveraging AI: they finish 12% more tasks, complete them 25% quicker, and produce 40% higher quality results compared to those without.  

This trend is accelerating – according to TIME, AI has already surpassed humans in various tasks, and the rate of advancement is only increasing.  

Foundational Models and Practical Use Cases 

One of the main discussions during the Lunch and Learn event was the introduction of leading Generative AI technologies such as GPT-4, Google Gemini Advanced, and notably, Anthropic Claude 3, which is currently leading the field. The discussion pointed out that the advanced capabilities of Anthropic Claude 3 make it a standout among foundational models, demonstrating the rapid progress and competitive nature of AI development.  

Another interesting innovation discussed during the event was the concept of AI Agents—autonomous AI programs designed with specific goals. These agents can independently work towards accomplishing objectives that are assigned to them. 

For instance, AI agents can serve various roles such as underwriters, deal managers, or asset managers. With hundreds of these agents working alongside your team, imagine the scale of operations you could manage—this is the capability that Smart Capital can bring to your business. 

By leveraging such sophisticated AI technology, businesses can not only optimize their existing workflows but also unlock new avenues for growth and innovation. This approach empowers companies to handle more complex transactions with greater accuracy and less overhead. 

But theory is only half the battle. Smart Capital team outlined these compelling uses of AI in CRE: 

  • Ultra-fast deal underwriting 
  • Summarizing complex documents for rapid analysis 
  • Staying on top of changing regulations and market trends 
  • Identifying high-potential investment areas 
  • Turning raw data into compelling visualizations 
  • Drafting investment memos, legal drafts, and more 

Smart Capital Center: Leading the Charge in AI-Powered CRE Finance   

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Concluding Smart Capital Center Lunch and Learn event, it’s evident that the rapid development of AI technology is reshaping the landscape of commercial real estate investment. The industry is witnessing an era where automation and data analytics enhance every step of the investment lifecycle, from deal sourcing to financing — thanks to AI-powered platforms such as Smart Capital Center. 

If you want to learn more about the power of GenAI and how it can transform your operations, connect with us today. 

Discover how Smart Capital Center

  • Drives speed
  • Enhances insights
  • Cut costs

Across full investment and Financing lifecycle

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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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