‘Get Behind, Or Get Out Of The Way,’ SIORs Warn Skeptics
AI and supercomputers have been, and will continue to be, the source of revolutionary changes within the CRE industry, say SIORs. “AI and supercomputers are revolutionizing global commercial real estate by prioritizing sites with robust energy availability, particularly for data centers and advanced manufacturing facilities,” says Ryan Thomas, SIOR, vice president with Cushman & Wakefield in Memphis, Tenn. “The focus is currently on searching for power, so markets around the globe that have historically been overlooked for capital development by the world’s largest tech companies, finally get a seat at the table if they have excess power or facilities that are easily re-developed.”
“With Moore’s Law [Moore's Law states that historically the number of transistors on a microchip doubles every two years], computing power has been roughly doubling every 18-24 months since 1965, and each time this happens the cost of computing power is cut by half,” notes Geoffrey Kasselman, SIOR, CEO of Evoke Partners in Chicago. “So, after more than 30 iterations, supercomputing is in everyone’s office and their computers and cell phones. Now layer on advanced technologies like 5G edge computing (enhanced data throughput at the place where data is created and consumed), the Internet of Things (IoT), and of course, AI. The result is transformation of everything – all businesses including the CRE industry.”
“The real opportunity we see lies in integrating AI with our proprietary market intelligence platform to analyze our extensive dataset of properties, owners, leases, and sales,” adds Andy Westby, SIOR, president & managing broker with Goldmark Commercial Real Estate, Inc., in Fargo, N.D. “Our goal is to leverage AI for deeper market trend analysis and opportunity identification, allowing us to provide even more strategic insights to our clients.”
Markets around the globe that have historically been overlooked for capital development by the world’s largest tech companies, finally get a seat at the table if they have excess power or facilities that are easily re-developed.
Strong Foundations Help
It’s logical that SIORs who have made a strong commitment to the access and use of market data are in a good position to understand and unleash the potential benefits of AI, and Westby certainly fills the bill with his company employing a proprietary market intelligence platform.
After 16 years in the software and tech industry, Westby entered commercial real estate in 2015 and found that his company’s “market data” was contained in a binder filled with old comps pulled from client appraisals. To fill a clear void, he found ways to extract large datasets from the MLS and combine that with public city and county property records, compiling his own market analysis quarterly. When he took over as managing broker, one of his first calls was to a former software developer he had worked with, asking if he would consider building a custom software solution to take what Westby had been tracking quarterly and transform it into a daily, real-time intelligence platform. In early 2020, the first version the system was launched; it allowed the company to track every lease listing on the market and every property sale since 2017.
Today, the system includes:
- A comprehensive database of every commercially zoned property in the market along with ownership records for every building.
- Tracking of every lease listing (active, closed, cancelled, etc.) and every completed sale transaction with summary market trends, comparisons, and detailed reports at our fingertips.
- Soon, it will be adding the ability to track every new commercial permit issued in the metro as well.
At present, Westby reports, “We are still in the testing phase of AI adoption, primarily using it for tasks such as generating marketing content and automating lease abstractions.”
He has tested numerous AI platforms, including ChatGPT, Claude, Gemini, Perplexity, Deepseek, and others. “While none have yet reached a level where we can fully implement them in a production environment, it is clear they are continually improving,” says Westby. “The biggest challenge remains training AI to understand and interpret complex, localized market data with the accuracy and nuance required for high-stakes real estate decision-making.”
An ideal future use for AI, he shares, involves the quarterly market reports, which are still compiled manually. “I foresee a future where AI can handle much of the initial analysis—identifying trends, summarizing key takeaways, and even generating drafts of our reports—while our team plays a review and refinement role,” he explain.
‘Just Scratching the Surface’
Other SIORs also see that when it comes to AI and CRE, we are still in the early stages. “I think we are only scratching the surface with applications for the current ChatGPT models of AI,” says Thomas. “Grok (a generative AI chatbot developed by xAI) is the no-brainer, for the same reasons we like to eat and shop with local businesses; Grok is here in Memphis! I have certainly benefited from its use; it can assist with wording challenging ideas/summaries, which really comes in handy when you have a lot on your plate -- every free minute is useful.”
He says he has also started using ideogram.ai for image generation. “I have found this to be the most useful when I am working to create visuals for social media posts,” he shares. As new software is developed, he adds, “It only gives us the ability to better serve our clients. Any type of competitive advantage I can get justifies any learning curve!”
AI, says Kasselman, means more data, more analytics, more processing power, more insights, faster responses, more sophistication, enhanced capabilities, etc., “We’re now in a position to monetize our data for new revenue streams and enhanced ROI at both the property level and on an operating company basis,” he says. Soon to follow, according to Kasselman: Ultra-mobility and the ability to effectively and affordably live, work, and play anywhere; and affordable quantum computing to quickly tackle what were once unthinkable and unsolvable challenges.
And how is Kasselman taking advantage of these new opportunities? “We are leveraging AI in every possible way,” he asserts. “We used it to write the content of our website and deliver it in record time. We use AI agents like ChatGPT and Perplexity for everything – ideas and suggestions, document templates, travel planning, lists, data evaluation, truth detection, and so much more. We use AI to automate internal pain points and minimize bottlenecks that used to slow us down. We have custom-coded, proprietary client-facing software, which is already being monetized, and which has been set up to be a spin-off company in the future. We have monthly all-hands phones-down AI ‘moonshot’ meetings. AI is everyone’s reality and everyone’s future. We’re simply trying to stay relevant and viable.”
Advantages are Clear
While SIORs may still be in the “learning stage” when it comes to the ways in which AI and supercomputing can benefit their businesses, the advantages are already becoming crystal clear.
“There are endless applications for CRE, from property management to capital markets; ultimately the earliest users/adapters will have the strongest competitive edge,” says Thomas. “Once you can upload raw data (think of all the data that CoStar has access to historically) and overlay that with migration data, income data, interest rates, weather trends, insurance rates, etc., the type of computing power could tell you about the absolute best return on investment for any market across the country in a few seconds. AI will give users the ability to quickly make informed decisions and increase the speed of business transactions with confidence in their decisions.”
“Supercomputing in any form is accelerating the speed of market trend analytics, enriching related data streams, and detecting market anomalies and thus opportunities that might have otherwise been missed or overlooked, which in turn generates more revenue and reduces risk,” adds Kasselman. “Same thing with property management – faster work order processing, pre-emptive maintenance, superior tenant analytics, enhanced experiences, better overall performance. Same dynamics with design and construction. Adding supercomputing power and AI to everything supercharges it.”
The Sidelines are Not an Option
Looking to the future, say SIORs, one thing is clear: if you want to succeed in the future, you have no choice but to get on the AI ‘train.’ “As agents, we need to embrace AI technology, or we risk being left behind by brokerages that do,” warns Westby. “I believe we are only scratching the surface of what AI can do for our industry and our clients, and I am excited about the opportunities ahead. While AI will never replace the relationship-driven nature of commercial real estate—which I firmly believe will always be the foundation of our business—it will most certainly enhance our efficiency and decision-making.”
That will allow SIORs to focus more time on what truly matters – building and maintaining client relationships, he asserts. The brokerages that successfully integrate AI into their processes, says Westby, “Will gain a competitive edge by offering faster, more data-driven insights while still delivering the personalized service that clients expect.”
Kasselman agrees. “On the one hand, affordable supercomputing power and AI fast-evolving capabilities have been democratized and leveraged to be a game-changing equalizer by smaller more nimble companies. On the other hand, bigger companies like JLL and CBRE have undisputable depth of resources and cash reserves to leverage their own capabilities in this regard, potentially giving them a path to even greater industry superiority,” he observes. “The only real losers in this equation are those companies and practitioners who have declined to engage in this new reality. There is no refuge on the sidelines. Ultimately, everyone will be in the technology business with a focus on CRE, rather than the other way around. In turn, we expect to see new global partnerships, accelerated transaction activity, and new monetization opportunities that will enhance ROI for all stakeholders.”
“Trump’s recent announcement of the Stargate Project (a $500-billion enterprise to develop AI infrastructure in the U.S.) signifies a pivotal shift, transforming AI from a technological pursuit into a key component of national strategy,” adds Thomas. “I would compare the AI and the energy/infrastructure race to something similar to historical national strategic races (think nuclear arms and race to the moon), emphasizing energy requirements and grid access as critical factors. This is also giving rise to small modular reactors (SMRs), enhances energy independence, enabling more flexible and sustainable site options for AI-driven industries. As these developments unfold, they will reshape commercial real estate landscapes, making energy-efficient, strategically located properties highly sought after, which is vital for meeting the demands of a tech-driven future.”
Looking further into that future, Kasselman expects accelerated change to be the dominant theme. “Getting comfortable with endless change and the rapid evolution of everything should be a priority for all,” he says. “Staying nimble, self-education, dynamic team formation, new sources of capital, better KPI’s, constant innovation, etc. Beating our clients to the future and welcoming them when they arrive. So, the winners will ultimately be those most adaptable to change.”
“As AI technology evolves, we expect it to enhance both efficiency and depth of analysis, ultimately helping us deliver even greater value to our clients,” says Westby. “The future of AI in CRE is going to be exciting to watch, and even more exciting to be a part of!”
This article was sponsored by the SIOR Foundation - Promoting and sponsoring initiatives that educate, enhance, and expand the commercial real estate community. The SIOR Foundation is a 501(c)(3) not-forprofit organization. All contributions are tax deductible to the extent of the law.
CONTRIBUTING MEMBERS