Digital transformation is not a new concept, but digital transformation in the commercial real estate (CRE) space is often overlooked. CRE providers are turning to new technology to meet the growing demands of tenants and their consumers. CRE Facility Managers need to understand the current state of digital transformation in the space and what it means for facilities management and operations.
Challenges of Digital Transformation in the CRE Space
- High turnover among team members. Implementing new technology as part of digital transformation will result in increased employee turnover, but organizations that properly train and prepare team members for such changes can avoid this problem.
- Changing needs of tenants. Tenant needs are also evolving. For example, most tenants now expect Wi-Fi and sustainable business practices to be a cornerstone of any business relationship, especially the relationship with the CRE provider.
- Restrictive legislation. State and local governments have passed additional legislation that requires greater transparency and sustainability requirements from CRE providers, which will naturally result in a rushed transition to digital processes.
- Demand for process simplification. In the world of e-commerce, business never sleeps, and tenants will want faster, more simple ways to get things accomplished. CRE providers will also need this.
- Finding easy-to-use, deployable technology. One of the last barriers to digital transformation in the CRE space derives from the confusion that exists and attempting to select an energy management partner. In addition, the technology needs to be easy to deploy and use.
Digital Transformation Continues to Drive CRE Facility Management Across Property Types
As explained by Building Owners and Managers Association International, the recent “Commercial Real Estate Technology Trends 2018” report found a strong demand for technology across all types of buildings. Only 4 percent of those surveyed self-reported a high level of use of technology, yet 60 percent allocate funds to CRE technology in the budget. The variance derives from a difference in how technology is approached in larger companies. Corporate-Based initiatives to improve facilities’ use of technology are 20-percent more likely to have a significant effect than those selected at the property level.
In other words, CRE portfolio managers that decide to use technology have a resounding effect throughout the company, increasing property-level adoption rates and creating a strong sense of support for such investments. Moreover, the majority of CRE professionals cite artificial intelligence, machine learning, and drones as the most important technologies to affect the industry in the future. Digital transformation is the new buzzword in facilities management.
Benefits and Tips for Digital Transformation
As explained by Bryan Christiansen of Facility Executive, the digital transformation of facilities management offers lower operating and energy costs, better guest and tenant experiences, higher asset valuation and reduced maintenance costs. These benefits are in addition to better worker experiences and streamlined processes. Therefore, Facility Managers must begin working to transform their distributed facilities with these steps:
- Research trends in the digital transformation of CRE energy management.
- Be a strong leader.
- Focus on both short-term and long-term outlooks.
- Involve stakeholders.
- Audit assets.
- Use data to validate the results.
- Optimize processes.
Digitize Your CRE Property
CRE property managers have a unique opportunity to get ahead of the trend and push for more digital transformation in this space. CRE energy management is evolving, and companies are looking for ways to increase profitability, reduce reliance on nonrenewable energy resources and adhere to new, tightening government regulations.