You may have heard a bit about Augmented Reality (AR) and Artificial Intelligence (AI) lately, but if not, they may sound like something from the latest sci-fi film. In truth, they are here now, and they are poised to change the face of commercial real estate. Whether you’re a developer, an investor or a business leader, these emerging technologies are bound to have an impact with ripple effects that reach you.
That they’re here is one matter, that they’re set to explode is another. Goldman Sachs researchers estimate that by the year 2025, VR tech is likely to generate $2.5 billion in revenue. So the financial implications are great, but what does this mean for CRE?
Sectors of CRE set to change via AR and AI
Experts say every sector in CRE is already seeing evidence of the impact of AI and AR. Here are five ways they are affecting sectors by saving money, streamlining processes or generating revenue.
1. The retail sector
Retail products are already moving differently thanks to AR and AI. AR is already resulting in pared-down stores, allowing merchants to sell daily purchases like furniture, clothes, automobiles and appliances. The result is that retail commercial real estate will need to be tech-ready and the possibilities for retailers who want to cut costs on inventory and warehousing are expanding.
2. The office sector
The remote workforce is real, thanks to relatively recent technological advances. But with AI, robotics and automation, reports that up to 60 percent of the workforce could disappear. That’s in, “ .” Meanwhile AR and virtual meetings are allowing companies to reduce their travel budgets. The bottom line: commercial real estate professionals will need to view assets through this lens to find creative ways to accommodate these massive changes for clients.
3. The industrial sector
Retail and industrial changes are moving in tandem. AR and AI are being employed in industrial buildings, manufacturing and distribution channels to cut delivery times, reduce mistakes, lower payroll and improve warehouse and distribution efforts.
4. The hospitality sector
Front desk staff are getting a futuristic overhaul. Hotels, resorts and inns are now beginning to replace concierge and front desk employees with AI that is voice-activated. It works like smart home technology: guests can just say what they want, and the room will do as told.
5. The multi-family sector
In the multi-family sector, AR is helping fill spaces with tenants even before construction begins, by letting them virtually walk through the living space before it exists. More, AI is now matching stakeholders in the CRE space: tenants with landlords and developers with the right investors.
The future of CRE is AI and AR
When it comes to the future of CRE, AI and AR are big time change makers, bringing sci-fi fiction to life, with exciting implications.