As more data presents itself, we are learning that artificial intelligence (AI) has the power to transform commercial property management. And many CRE professionals are embracing these changes by implementing new technologies at their buildings.
In fact, according to JLL’s Global Real Estate Technology Survey, more than 500 companies are providing AI-powered services to real estate globally. However, research from that same survey shows that although property teams deem generative AI, machine learning, and AI analytics as high-impact drivers when it comes to tech, they also say this is the technology they know little about.
However, AI is set to transform commercial property management with:
- Enhanced operational efficiency
- Better tenant experience and retention
- Improved decision-making with data analytics
- Smart energy management
- Streamlined lease management
1. Enhanced operational efficiency
Property teams allocate a lot of time to routine tasks, such as processing tenant requests, maintaining records, and managing finances. AI-driven automation is changing that by handling these tasks with efficiency and accuracy.
For instance, AI can now automatically categorize and respond to tenant maintenance requests, flagging urgent issues for immediate human intervention while scheduling less critical items for regular maintenance blocks. Machine learning algorithms continually improve processes, learning from each interaction to optimize future responses and minimize human error.
Additionally, predictive maintenance is becoming a driver of operational efficiency. AI systems, when integrated with Internet of Things (IoT) devices, offer real-time monitoring of building equipment. By analyzing data from sensors on HVAC systems, elevators, and other critical infrastructure, AI can predict when a piece of equipment is likely to fail and suggest preemptive maintenance. This shift from a reactive to a predictive maintenance approach not only prevents downtime and saves costs but also extends the lifespan of building amenities. The synchronization between AI and IoT ensures a seamless flow of building operations, often unnoticed by tenants but crucial for uninterrupted service.
2. Better tenant experience and retention
Today’s tenants expect instant, on-demand service. AI-powered communication through chatbots and virtual assistants makes that possible. These intelligent systems are available 24/7 to answer tenant queries, process service requests, and provide information, eliminating wait times and streamlining support. Their ability to learn from interactions helps to deliver increasingly personalized communication over time, adapting to the unique preferences and needs of each tenant. It’s a win-win for operational efficiency and tenant experience. And that leads to better lease retention rates.
3. Improved decision-making with data analytics
In the age of information, superior decision-making in CRE hinges on the ability to analyze and interpret large sets of data. AI in big data analysis is reshaping how CRE professionals make informed decisions, from daily operational adjustments to long-term strategic planning.
CRE generates massive amounts of data. Historically, the sheer volume and complexity of this data posed a challenge for meaningful analysis. AI revolutionizes this by quickly sifting through big data to identify patterns, extract insights, and provide actionable intelligence. Machine learning algorithms can digest historical trends, current variables, and even unstructured data from social media, reviews, and more to offer a comprehensive view.
4. Smart energy management
Energy consumption is another frontier where AI is making significant strides. Smart energy management systems leverage AI to analyze consumption patterns, adjust to peak and low-demand periods, and even interface with public utility grids to negotiate better rates or sell back excess energy.
Thanks to AI, smart buildings are now equipped to dynamically adjust lighting, heating, and cooling based on occupancy levels and external weather conditions, reducing waste and saving property owners substantial costs in utility bills.
5. Streamlined lease management
AI tools can process complex lease documents with speed. Through natural language processing and machine learning, AI can extract critical information from lease contracts such as terms, clauses, renewals, and expiration dates with accuracy.
The advancements in AI for lease abstraction not only expedite the task but also facilitate a better understanding of portfolio-wide lease obligations, rights, and exposures, which can inform strategic decisions and compliance measures.
This also comes in handy with invoicing and account management. Intelligent systems can match payments to lease accounts, recognize discrepancies, and even predict cash flow based on payment histories. This automation reduces the administrative burden on teams, mitigates the risk of human error, and ensures a smoother financial operation. It enables property managers to focus on more complex tasks that require human insight while the AI deals with the routine financial administration.
AI in commercial property management
AI has the capacity to transform commercial property management as we know it. Looking forward, the trajectory for AI in commercial property management points to an increasingly integrated, intelligent, and user-centric industry.
AI will likely continue to evolve, with algorithms growing more sophisticated and predictive capabilities reaching new heights. The convergence of AI with other emerging technologies will continue to push the boundaries of what’s possible in CRE.
Learn more about the tech trends transforming commercial property management in the free report, “The state of commercial real estate property management for 2024.”