Real Estate Investors, Managers in EU, UK to Spend More on Digitization Over Next 3 Years, Arcadis Survey Reveals

A plurality of Real Estate investment directors and asset managers in Europe and the United Kingdom plan to spend significantly more over the next three years on digital technologies to help them more successfully acquire and manage property, according to a new Arcadis survey. Approximately 45 percent of investment directors and asset managers we polled said they intend to annually through 2021 step up their purchases of digital platforms, data analytics systems, deal-sourcing tools, and asset-management software.

Real Estate Investment

Real Estate’s ‘iPhone Moment’

The survey sampled the opinions of 29 investment directors and asset managers who together are responsible for over €50 billion worth of Real Estate holdings. The findings of our survey suggest that many—but not yet most—Real Estate industry players appreciate the necessity and urgency of adopting digitization as a response to societal, economic, environmental, and technologic disruptions now occurring.

Those who are embracing digitization report being liberated from the problems of slow acquisition-and-financing processes, inconsistent asset data, and paper-based interfaces. They express satisfaction with their decision to join the digital revolution and expand their participation in it.

Our survey results lead us to conclude that we may be looking at the Real Estate industry’s equivalent of an “iPhone Moment”— that point in time when there occurs a convergence of key technologies (as in 2007, when the debut of the iPhone brought together within a single package a telephone, an MP3 player, a camera, and an electronic storage system).

 

Better Business Dealings

Other key findings of the Arcadis survey:

• Digitization is promoting closer tenant relationships, which in turn are driving increased revenues.

Fully 60 percent of survey takers reported that digitalization improved their dealings with tenants. Technology allowed these investment directors and asset managers to process tenant data and feedback much faster, resulting in welcome improvements to tenant services and the opening up of additional revenue streams. Indeed, this speed gain was cited by 38 percent of the survey takers as a top reason for going digital in the first place.

• Digitization is powerfully contributing to reduced Real Estate acquisition and management costs.

There was unanimity among the respondents that technology is a viable solution for driving down the costs of buying, financing, and maintaining assets. However, they were divided when it came to identifying the role in which digitization can shine most brightly as a cost-saver.

priority objective of digital investments

• The Real Estate industry needs standardized, open-source data.

Survey participants said they see a need to standardize CAPEX, OPEX, and Sustainability benchmarks along with occupier performance data. They indicated standardization is a must if data are to be converted into market intelligence of genuine value. One respondent commented that there needs to be "standardization in data collection [and a] fixed set of data standardization in terms of [the] minimum set of data made available to tenants." Another added that standardization would result in better online tools. Others foresee standardization making possible "clearly mobile access to real-time detailed information," "real-time loan-servicing data access…integrated with underlying asset management data," faster, more comprehensive, and more interactive reports," and "data usage risk forecasting." Still other benefits of standardization the respondents cited include improved general administrative tasks and financial actions, such as payments processing, report creation, and ongoing monitoring.

• There will be useful apps for test-driven development.

Many of those who took our survey say they expect to see the power of digitization harnessed in support of test-driven development (TDD) activities. Those among them who came to EXPO REAL in Munich this past October observed and even experienced that power in demonstrations conducted at the Arcadis booth. There, we unveiled an app that allows live access via mobile devices to progress and summary TDD audit findings. We’re calling this app TDD Insight.

TDD Insight and an array of other outstanding digital tools to help you uncover Real Estate investment opportunities, acquire them, manage them, and gain from them the best possible ROI are available from Arcadis.

Matthew Cutts

Global Sector Leader - Financial Institutions Ask me a question