The commercial real estate (CRE) landscape continues to morph in response to economic, environmental, and societal drivers.
To shine light on this evolving landscape, and to learn what CRE property teams plan to focus on in 2024, Building Engines partnered with Building Owners and Managers Association International (BOMA) to survey commercial property professionals about the state of CRE property management.
More than 230 CRE professionals were surveyed, answering questions about their current portfolios and their expectations for the year ahead.
Here are the top property management trends property teams can expect to see in 2024 based off those results.
1. Tenants are returning to the office
This year, a prevailing sense of optimism emerges as more tenants gravitate back to their offices full-time—a stark contrast to the dispersed, remote working conditions of previous years.
According to this year’s survey results, CRE professionals have reason to be cautiously optimistic. That’s because the majority of survey respondents (61%) said they are seeing more companies/tenants transition back to the office full time.
2. Property teams struggle to prioritize work
In this year’s survey, many respondents named prioritization of work as their top focus. It was cited as the No. 1 challenge for completing work orders and the No. 1 priority for enabling engineers.
But while prioritization challenges rank as No. 1 for completing work orders, a shortage of staffing resources is the second most challenging issue facing property teams. It could be that teams do not have enough staff members to complete their work in a timely and efficient manner.
3. Sustainability and ESG initiatives are top of mind
Looking ahead, the importance of sustainability initiatives and ESG reporting remains undiminished, gaining even more traction than in the past.
The data trends over the past three years show that commercial property teams continue to prioritize energy efficiency and expense reduction. For 2024, the majority of respondents (64%) plan to do just that again this year, with utility bill data capture and ESG reporting coming in as No. 2 and building planning and design as No. 3.
4. Property teams plan to enhance their tech stacks
Enhancing tech stacks at commercial properties has reemerged as a key priority, influenced not only by shifting tenant needs but also by burgeoning expectations in an increasingly digital world.
For those planning on enhancing their tech stack this year, the areas of focus were aligned with what property teams said last year. Building operations/equipment maintenance is the No. 1 priority (73%) and tied for No. 2 is energy management/sustainability and tenant experience.
These areas—building operations, sustainability, and tenant experience— are three pillars to better property management and lay the groundwork for creating successful CRE properties. It comes as no surprise that property teams are choosing to narrow their focus on these three areas of their tech stack year after year.
5. AI has the potential to disrupt the CRE industry
As more data presents itself, we are learning that AI has the power to transform the CRE market. 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 technology is something they know little about.
Learn more property management trends for 2024
As we emerge from the lingering shadow of a global pandemic, the CRE industry is displaying resilience and embracing the challenges and opportunities that have come its way. Property teams continue to prioritize tenants and the transition to intelligent building practices that ensure extraordinary experiences for occupants, all while striving for energy efficiency and procedural streamlining through automation.
With the right strategic mindset and thoughtful investments, CRE property teams are well positioned to navigate the evolving landscape this year and the years ahead.
For more actionable insights and to learn what else your peers are experiencing, download the full report, “The state of commercial real estate property management for 2024.”