Five Factors Shaping Technology Use
By Michele Lerner

Jim Young knows a thing or two about real estate technology. As the chief executive officer of commercial real estate technology conference Realcomm, Young has identified five key factors that have happened in the past year or so that have fundamentally affected the real estate business and what technology decisions real estate companies need to make.

1 - The first factor is the expansion of broadband capabilities in the face of industry turmoil. “There has been tremendous carnage among companies providing this service,” Young says. “In the past year, perhaps as many as 75 percent [of the broadband providers] declared bankruptcy or are on the way. But at the same time, everyone acknowledges that high-speed connectivity to the Internet is required. Any building that does not have reliable, cost-effective broadband access will be considered second-rate and will not be competitive.”

2 - A second key issue has been the increased use of wireless capabilities. “Every company ought to be at least experimenting with providing this capability to property managers and customers. Wireless capabilities will eventually be available everywhere, including airports, restaurants and retail centers,” Young says. “Wireless technology is relatively inexpensive now, so that what used to cost $10,000 can now cost as little as $150. There are basically three standards for wireless, known as 802B, 802A (which is the newest standard) and Blue 2, which works only in short distances. For instance, Blue 2 could be used to establish a system for people to swipe their cell phone past a sensor to get into the lobby of a building or into a garage.”

3 - The third factor has been more universal: the rise of the first standard, wide-area network—the Internet. “It used to be that different systems couldn’t talk to each other, but the Internet now provides a consistent standard communications network at almost no expense,” Young says.

4 - Fourth, the network appliance industry is poised to explode and the coming trend will be that every piece of equipment in a building and even the building itself will be connected to the Internet, according to Young. “For instance, an air conditioning system could become an Internet appliance so that instead of adjusting it physically or reading meters to determine usage, this could all be done online,” Young says, adding that video cameras for security and building directories could become web appliances as well. “It could be almost like playing an orchestra online, adjusting every system in the building through the Internet so that it all works well together.”

5 - Young calls the fifth factor the entering of “Phase Three” of the Internet–complete connectivity. “Companies now need to have web-based information systems so as to eliminate paper completely and to take processes to real time,” Young says. “Once the connected world changes the real estate world, then the next step is for tenants to start using their space differently. Real estate companies need to be ready to provide the services their tenants will demand.”