We tend to think of data as a tool for understanding the “big picture.” It’s true that data provides tremendous perspective on industry trends, market conditions, and best practices. Aggregation services that compile this information and present it in a digestible format are worthy of a line in any firm’s budget.
The data that’s available for CRE is critical for informing decisions on investment, valuation, and development. It helps develop a deeper understanding of the market by providing details on cap rates, vacancies, rent comparables, new development, and many other key aspects of the market.
For owners and developers, data can be utilized on a smaller scale to understand the market on a hyper-local level. Tuning into the trends and conditions in the local market through the use of relevant data is a sure way to improve performance and help owners and developers to identify and act on opportunities. CRE data can be especially helpful in three major areas.
A solid understanding of the local market, including historical information and projections as well as current conditions, helps to inform marketing decisions. It’s wise to consult the data in planning an effective marketing strategy.
Attracting tenants is one marketing area in which data are helpful. With access to information on area demographics, including prominent area businesses, job growth, and general economic trends, marketing efforts can be targeted to a relevant audience.
The use of data in building and portfolio management is tremendously valuable. The potential for improving tenant services is great when data are put to use. While this is still essentially a human relationship, analyzing our interaction with tenants provides helpful insights and a basis for more efficient property management.
For example, analysis of tenant requests for service can inform decisions on maintenance issues. The information can be used to determine the most cost-effective solutions and also how to enact those in a way that disrupts the tenant’s routine as little as possible. The result is cost savings and a higher level of tenant satisfaction.
The CRE data available provide a solid foundation for decisions related to property sales as well. Obviously it’s essential to have a clear picture of comparable prices in the area, as well as any tax considerations that apply to the local market. It can also be extremely helpful to understand the long-term rental patterns and demographic trends in the area. This ensures that pricing is fair and competitive.
Being able to provide potential buyers with this sort of in depth information on the local market can also be critical to making a deal move forward. Data aggregation allows for instant access to relevant figures that would take weeks to gather on your own.
In this digital age, there is no shortage of available information. The key is isolating the information that works for you, and applying it to specific processes and problems. Taken together, data are a powerful and essential tool for informing decisions, developing strategies, and improving services.