Virtual Reality is Improving the Commercial Real Estate Sales Process
Commercial Property Owners and development companies are now using virtual reality to plan, manage and then market projects. Numerous firms have adopted Virtual reality technology to help clients visualize what they will get when a project is done, not only as space is now, but as it could be in the future.
As Wall Street tries to calculate the possible impact on a number of industries, Goldman Sachs Group has put forth some charts laying out its assumptions for what it believes will be an $80 billion market by 2025., with an estimated 2.4 Billion being attributed to the real estate industry.
Per the Report
“Our Base case assumptions lead to $750mm in revenue in 2020 and $2.6bn in 2025. To size the market we consider the number of agents using VR as a selling tool and the potential average annual spend. We believe the value proposition of a VR listing ad can significantly outweigh that of an online ad. For 2020 we estimate 130k in real estate agents using VR to show properties with an annual spend of $5,000 which we believe can grow 10% annually. In light of a $107bn real estate commission market and given VR has the potential to change the business model, we see these estimates as conservative.”
Property managers and development companies are using virtual reality to plan, construct and then market projects. New startups are popping up to handle that process. Virtual reality software lets users take 360-degree immersive tours of spaces and gives us a wider field of view. The concept of the virtual desktop no longer confined by the size of the physical display screen on our desktop or palm of our hands. In the world of VR, the controls of the device become what we are already familiar with through gestures and graphics.
Given this attributes of ease of use and multiple use cases across the real estate industry, VR has the potential to disrupt and improve the real estate buying/ leasing process.
An exhaustive search for a office or retail space could end as a costly disaster if the company doesn’t turn to a design specialist to do a test fit to make sure the space can efficiently accommodate the client. That’s why many building owners and commercial realtors working with professionals often provide or suggest a test fit or rough layout of a space to make sure it meets the potential client’s needs.
This relatively simple and quick rough layout of the space under consideration can quickly reveal if the space is appropriate, or if it will be a costly mistake for both parties to proceed with an office that will not effectively accommodate the needs.
Consider empty space that are available but leave little to the imaginations. Imagine walking through that same space with a creative type design and then with a swipe of a button changing to a more contemporary or modern layout. Virtual Reality provides endless possibilities to marketing spaces to potential buyers and tenants.
Brokers also benefit from virtual reality in many amazing ways. Virtual Reality give brokers the flexibility to customize their pitch to each tenant and instantly react to feedback on how a tenant wishes to use the space. Imagine instantly showing a law firm several different layouts in a full immersive experience. You can share multiple test fits and space plans within minutes on a headset or through webvr which allows desktop, phone or tablet experience. You can show one layout to an accounting firm and a different layout to a software development company. Then bring your ipad or Google daydream headset on the tour and show multiple space options as you learn more about your tenants needs. Early adopter brokers can utilize the software a way to differentiate and win new business.
Virtual reality is still new, and it’s anybody’s guess how quickly clients might adopt the technology. What is clear, though, is that virtual reality’s a flexible technology with far-reaching utility and commercial real estate is just another avenue to showcase the potential of Virtual Reality and the effect it will have on our future.
