Impact on CRE: What to Expect from the Incredible Rise of AI
The rapid advancement of artificial intelligence (AI) has everyone talking about the possibilities across many industries. The commercial real estate (CRE) industry is no exception. With the integration of AI and machine learning – as well as the recent surge in generative AI – the industry is poised for significant transformation.
At JLL Spark, we expect AI to make the most immediate impact in five areas of CRE. Here are some examples of the technology in our portfolio that address these areas.
- Construction design, management, and visualization
Generative AI enables architects and developers to explore many more property design options, faster – resulting in more innovative and functional properties. By leveraging vast amounts of data, it can generate design variations, considering factors such as location, aesthetics, and functionality. Construction professionals can generate highly realistic and immersive imaging of buildings and infrastructure throughout the project, providing stakeholders with clear visualization and insights into progress, areas of concern, and safety.
OpenSpace: Construction site video and documentation software that uses AI to provide 360-degree visual representation of a job site to capture and analyze data.
- Future of work planning
Maximizing the use of available space to meet specific needs is critical in CRE. By understanding how people move and interact within a building, AI algorithms can suggest layout modifications to optimize the space for productivity and efficiency. It analyzes occupancy patterns, employee behavior, and workflow data, and provides real-time actionable insights for making the most of the space.
VergeSense: Occupancy sensors powered by computer vision and VergeSense AI drive effective space utilization, reduce operational costs, and improve overall workplace experiences.
- Predictive analytics for market trends
Generative AI can empower investors, developers, and brokers to make data-driven decisions, mitigate risks, and capitalize on market trends. The algorithms can analyze vast amounts of historical data, market trends, and economic indicators to predict future demand and identify emerging opportunities. This means you can anticipate changes in demand, rental rates, and property values to stay ahead of the competition.
Skyline AI: JLL acquired this leading AI company in August 2021. Skyline AI is transforming CRE using proprietary machine learning models to gain a competitive advantage in the origination and analysis of real estate opportunities. In Q1 2023, one in five JLL capital markets opportunities were sourced with the help of this AI-powered platform.
- Personalized customer experiences
Generative AI also has the potential to revolutionize customer experiences in CRE. By analyzing data from various sources, such as customer preferences, demographics, and behavior patterns, personalized property recommendations and tailored experiences can be created and offered whenever customers need them.
EliseAI: Powered by machine learning, the Elise AI platform provides accurate, conversational assistance to customers and helps businesses manage, track and act on communications 24/7, using data-driven insights captured by their generative AI software.
- Sustainable and energy-efficient buildings
Focus on sustainability in CRE is no longer just a corporate social responsibility differentiator. It’s a business imperative. The world is inching closer to exceeding the Paris Agreement’s global warming limit of 1.5 °C, and companies are under pressure to commit and follow through on science-based targets and corporate pledges.
Generative AI can play a significant role in optimizing building design and operations to reduce energy consumption and environmental impact. By analyzing environmental data, energy usage patterns, and construction materials, AI can generate building designs that maximize energy efficiency. Additionally, it can help identify retrofit opportunities in existing buildings, facilitating the transition towards greener and more sustainable practices.
Infogrid: The startup’s AI-powered platform gathers and analyzes data from Internet of Things (IoT) sensors to help property managers and owners optimize the performance of their various buildings.
As the technology continues to advance, CRE industry professionals can leverage generative AI to unlock new opportunities, improve decision-making, and deliver exceptional value to clients. The challenge will be to maximize the usage of this relatively new technology while balancing the impact on current roles and responsibilities while also keeping an eye on accuracy.
Embracing this transformative technology will be vital for staying competitive in the ever-evolving CRE landscape, but it is not without difficulties. We believe that the use of AI will become widespread, stretching the the available supply of AI expertise to help make the transition. Those organizations that are unable to create and execute on an AI-inclusive strategy will potentially lag in adoption and be at a cost and speed disadvantage to their peers. Therefore, partnering with startups already on the journey is a great way to ensure that you can capitalize on one of the most exciting technology trends in recent memory.
Written by Sonia El-Sherif, Chief-of-Staff at JLL Spark
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