Stephanie Boyle
Content Marketing Manager, VTS
The competition in modern commercial real estate demands creativity, and owners and operators are focused on fostering lean, strategic teams. Especially in today’s economy where cuts to internal resources and technology are rampant, finding ways to attract and retain tenants in your buildings while streamlining operational expenses (opex) is essential.
Where teams are concerned, both internal and external resources are needed, bridging internal knowledge of the market with external expertise concerning tenant behavior and expectations.
But it is challenging for firms to bring in-house employees and third-party partners together. If data and insights aren’t shared across all stakeholders, it’s harder to create an exceptional leasing experience for the tenant, thus making it more difficult to close a deal.
If all teams — from asset management and marketing to third-party leasing and property management — were given a unified platform to communicate, collaborate, and share information, a commercial real estate firm and its third-party partners could operate like one team.
How are firms streamlining resources
38% of landlords are investing in ways to consolidate their tech stack, creating a single source of truth and lowering solutions-based costs.
While downsizing technology and workforce are both difficult decisions, these cuts are not made lightly.
Owners are asking:
- Is our firm prioritizing the right roles?
- Do we need to consider outsourcing certain roles?
- Does our existing technology stack clearly add value to how we operate?
The result? An increased dependency on third parties to drive leasing activity and manage your properties with potentially more fragmented operations. This means it’s back to the drawing board to strategize how more can be done with less.
The challenges of reduced resources
With fewer internal resources, firms have to adjust strategies to account for these opex changes.
Increased dependency on third-party partners: Depending more frequently on external stakeholders becomes challenging when your goal is to have a shared understanding of what’s happening with your tenants and the broader market.
Disparate systems create knowledge gaps: Disjointed legacy systems for tracking deal activity, bringing spaces to market, and managing building operations will fail to connect internal teams with third-party partners, leaving you with questions about your performance.
Lags in cross-team data sharing: The combination of third-party partners and multiple, disjointed systems means inaccurate or out-of-date data is used to drive decision-making around how to create an enticing building experience for prospects and in-place tenants alike.
When cuts to people and technology occur, it leaves the same amount of work to create and protect revenue for a space, building, and portfolio with fewer resources to make it happen.
The benefits of streamlining opex
With fewer technologies, there are fewer wires needed to effectively connect teams. Technology bridges the gap between internal and external teams so CRE firms can move as one entity.
Third-party expertise gives firms an edge: Third-party partners are experts in the industry and the tenants they serve, unlocking additional in-the-field insight and giving firms a holistic picture of what’s driving asset performance and tenant sentiment.
Platform technology exists to connect teams: Effective CRE tech will consider that not everything is in-house, and enable unity across multiple business functions, including:
- Marketing: content management, bringing listings to market, listing performance insights
- Leasing: deal pipeline tracking and CRM, transaction modeling, portfolio risk analytics
- Property Management: tenant experience applications, property operations, utilization metrics
- Portfolio Management: market valuation insights, tenant demand data, portfolio performance measurement
Advanced systems reveal early tenant insights: In contrast to a legacy system that clumsily pieces separate systems together, platform-focused solutions give stakeholders early access to tenant insights with data input from in-house and third-party teams at once and analyzed in real time.
What does this look like in practice?
Consider a leasing scenario where your asset manager notices that a tenant’s lease is about to expire, and they are at risk of not renewing.
In digging into this renewal opportunity, the property manager for that asset has had many touchpoints with this tenant and has noted that these conversations have been positive.
The marketing team sees that this tenant has been actively viewing listings in the same building and are looking to expand their current space.
With all of this information found in a central platform, a third-party broker can leverage this powerful data and connect with the tenant in a meaningful way. Already armed with advanced insights on their current lease, expectations and desire for a larger space, the broker can easily tailor the conversation to retain and even expand the lease.
This would improve transparency and alleviate issues where teams are working in silos and doing business with outdated data. The key to enabling this integration is finding a robust platform technology that supports every business function while also opening lines of real-time data sharing.
How can a technology partner enhance streamlined firms
Technology removes roadblocks, especially when multiple teams are involved. However, it can be difficult for both internal and external stakeholders to adopt new tech when it impacts their already effective processes.
66% of technology rollouts fail when four critical barriers to adoption stand in the way:
- Misalignment of goals between stakeholders
- Rigid workflows that don’t meet business needs
- Poor change management leading to low adoption
- No support in achieving success post-launch
A technology provider that acts as a partner will be able to effectively foster alignment, implement new solutions, create an atmosphere for adoption, and help firms optimize processes with their new platform.
For these reasons, it’s essential to evaluate potential technology on a tactical level, but also evaluate what the life of your teams look like once the technology is enabled. A set-it-and-forget-it service provider may have a solution that works, but without the continued support of an expert team, you will be left out to dry when issues arise.
The next steps
Streamlining your opex is essential to remain competitive and continue to provide tenants with an unbeatable experience from lead to lease (and beyond).
After evaluating your current resources and streamlining your expenses, it’s time to focus on the technology you need to reduce costs while maintaining success.
In this blog, see how executives recommend evaluating solutions to find the best fit before, during, and after implementation.
Stephanie is a Content Marketing Manager at VTS.