We’ve all heard the phrase, “data is king” before, and it seems that this sentiment will hold true for the future of commercial real estate. In a recent episode of the AFIRE Podcast, hosted by Gunnar Branson, Michael Mandel discussed the importance of data in CRE. Take a listen to the episode here.
Although data has always been present in CRE, it has been approached differently by various schools of thought. Old school players prefer to be in the field themselves and inspect a building’s perimeter to understand a CRE asset. Conversely, some in the CRE market rely on data to understand the asset. Factors such as average rent in the area and desirability of the location are key insights that can be obtained from data sets. Before proptech existed, brokers would call up other firms and trade comps with them. Data was passed around, but it wasn’t streamlined and compiled into one place. Now, with the right CRE technology, trading and sourcing relevant data has become easier and more efficient.
While gathering data is one thing, ensuring its reliability is another. Cue: the CompStak platform. CompStak is known for its crowdsourced nationwide CRE data. Brokers give CompStak data in different formats, and the team of real estate data experts ensures the reliability of the lease and sales comps. All of this data is analyst-reviewed and then compiled onto the CompStak platform.
When asked where the CRE industry is heading, Mandel believes that it is becoming more data-driven. He suggests that some firms will build out data science groups, while others will need to source their data from third parties. Those that invest in data science departments will be able to leverage internal data to find new opportunities. In the end, everyone will be investing in the data itself, regardless of whether it is collected in-house or not. As Mandel notes, “you can’t do anything without the data.”
The takeaway: when everyone invests in data, it becomes more available and transparent.
Interested in learning more about how CompStak is creating transparency in commercial real estate? Let’s talk!