Technology in Real Estate: A 75-Year March of Progress
Setser, Bradley, Journal of Property Management
IT'S AMAZING--THE MASSIVE EXPANSION OF TECHNOLOGY'S REACH ACROSS ALL ASPECTS OF HUMAN ENDEAVOR THROUGHOUT THIS LAST CENTURY, FROM TRANSISTORS TO SPACE FLIGHT TO COMPUTERS AND HAND-HELD ELECTRONIC DEVICES.
Over the 75 years of IREM's existence, the commercial and multifamily segments of the real estate industry have been no exception to this breathtaking escalation. Today, real estate management is driven by its underlying technology. The scope of technological innovation would astound even the most visionary leaders of three quarters of a century ago.
Decades of evolution, from ledgers to computers
Handwritten bookkeeping methods from the 1930s eventually gave way to the first forms of automation. It wasn't until the last quarter-century that the real estate industry experienced the most profound growth and progress in its portfolio management technology.
In the 1980s, Microsoft DOS-based accounting systems let real estate managers and accountants make digital entries to property financial books and generate static reporting by using computers.
This marked the end of the era of manual ledgers and handwritten checks; property managers and accountants began relying on databases to keep transaction information organized and easily accessible. For the first time, property managers and investors could validate data entry and produce automated reports on occupancy percentages and financial performance. As technology continued to advance, visionary commercial and multifamily real estate companies saw opportunity in innovation. They realized that working more efficiently and managing more information in meaningful ways would provide a competitive edge and generate growth through the expansion of portfolios and new markets--and that was just the tip of the iceberg!
Business strategy in a technology culture
Technology has evolved to the current state of the art in real estate technology: strategically focused Internet-based property management software packages that consolidate portfolio, financial, lease and other data into one database. The best equipped among them comprise a browser-based, dashboard-driven platform that handles the full real estate lifestyle for a diverse portfolio with dynamic consolidation capability, and even include functionality for multiple tax and accounting rules, language translations and currency conversions--all in a single, fully integrated, end-to-end system. This all sounds technically impressive, but what does it really mean for today's property managers?
The answer is a series of profound payoffs for property managers: better informed decision-making and faster access to information on new or expanded markets, along with the means to grow operations. With a complete picture of a portfolio, managers can diminish risk and more easily see a path to organizational growth and profitability. Another byproduct is healthy synergy of best practices and competition: Businesspeople seeking faster and more agile technology to match and surpass their competitors look to their technology providers for the next great innovation, which in turn leads to the industry's next wave of best practices.
As in any industry, property management companies must consider all stakeholders's expectations when devising a strategic business plan. Technology has permeated both our business and personal lives, giving rise to high expectations of information accessibility, service availability and investment success. Today, competitive edge is gained not only by efficient operations, but also by managing larger portfolios, making faster and more reliable decisions, and providing services that competitors can't provide.
Over the past 75 years, real estate's most successful leaders were those who were able to look ahead. Today's leaders must do the same; as part of their vision for success they must understand how to leverage the latest market demands and economic trends. …