Big data. It’s a buzzy term thrown about, but what does it really mean? And what does it specifically mean for commercial real estate?
Development magazine describes big data in CRE as spanning “everything from leasing, financial and demographic statistics, to building systems information, to tenant movements inside of buildings. It can also include things such as social media and news feed monitoring. Much of this information is being gathered by sensors and cameras connected to the internet of things (IoT), which is the embedding of internet connectivity into devices and objects.”
Big data is created from an incalculable amount of data points generated from mobile devices, smart networks, wearables and more. Medium reports that the volume of data created worldwide is forecasted to reach 163 zettabytes in 2025. In comparison, the total amount of digital information created by mankind in 2009 was half of a zettabyte.
In “The Office Property and Big Data Puzzle: Putting the Pieces Together,” a white paper released by the NAIOP Research Foundation, the author says that big data is spurring new technologies and disciplines that affect the real estate industry. For example, blockchain technology will have an increasingly larger role in data management and property transactions. The need for job positions such as data scientists, data stewards and data visualizers will continue to grow as companies take stock of their data sets.
In the office sector, big data can be a major catalyst for evidence-based decision making, helping developers, owners and building managers make informed choices that improve operational efficiencies, like HVAC and lighting systems, as well as creating and maintaining spaces that enhance the tenant experience, improving productivity and developing a cohesive working environment.
IBM says that understanding “the growth of big data in CRE, making informed decisions for properties based on that data, and [utilizing] enhanced reporting on decision making can enable CRE to develop technology roadmaps, streamline business processes, and implement leading practices.” All of these things deliver greater value to businesses.
Watch what Donna Salvatore, CEO of Megalytics, Inc, had to say on how big data is shaping commercial real estate today.
Kathryn Hamilton, CAE, is Vice President for Marketing and Communications at NAIOP Corporate.