Transparency of data produces a shift of roles in the real estate chain
February 2, 2016
Information asymmetry is an important phenomenon that can help us understand the historical distribution of roles in the real estate sector. Many services in the real estate sector owe their existence to the fact that one party possesses a certain knowledge which is not available to the other party. Transparency of data produces a shift of roles in the real estate chain.
You may know a consultant who helps you find a good location for a new office. He knows the market, the usual incentives provided and negotiation room with the rental party. As a result of transparency with regard to the many data sources that are so valuable to the real estate sector, we see a shift in the balance of power.
This can be seen most clearly in the world of realtors and appraisers. If you are looking for a new home, a little digital research will help you form a good idea about the local market. The public nature of transaction data sheds a different light on the added value created by the realtor and the appraiser. We observe similar developments in other links of the real estate chain. For example, let us look at a real estate manager who occupies a special position between the user and the owner of the property. Because of the greater availability and transparency of operating data and tenant data, the position of the real estate manager changes in this chain.
More control over cash flows in the management portfolio
The online benchmark tool developed under the leadership of Ingrid Janssen (TIAS) supports the real estate manager in this new role. The tool makes it possible to compare the operating figures between real estate portfolios and against the benchmark. These reference data give property managers more control over the cash flows in their management portfolio. Thus, it is expected that a better explanation of the development of cash flows is possible through a combination of cash flow related data with other data sets on property characteristics and market indicators. Properties will increasingly be managed from a "control room," equipped with dashboards for monitoring information on tenants, the market, and properties in real time and comparing it with the rest of the market. Property managers will thus have access to unique information that will boost their advisory role vis-à-vis real estate owners.
Added value to the owner and the user
The real winners will be the parties who are able to provide added value to the owner and the user with a smart management information system. It is a matter of time before the new generation of digital whizzkids will take over the helm in the real estate sector. Only then can we take stock of the new situation caused by this shift in roles. And this will happen faster than you think.
Do you want to read more about the increased transparency in property management? PropertyNL recently published accompanying article (in Dutch).