The need to give away information to stay relevant, up-sell your services to beat the robots and accept there will be fewer agents around, were among the insights shared by industry professionals in the latest part of our series on the future of working in property.
- Neil Hockin, director + Patrick Liddell, surveyor at retail and leisure agency, Lunson Mitchenall
- Shaun Simons, director of City Fringe for Colliers International
What are the new skills that property managers will have to learn?
Colliers International: I’m not trying to compare an agent to a brain surgeon but you’re always going to need doctors to do something. Robots will take over certain things, and nurses will, but you’re always going to need doctors in the same way you’re always going to need agents. Whether it’s on the marketing, development consultancy, or negotiation side, intel is a big thing that agents have, which robots can’t provide. Agents will always be required but they have to become more modern in the way they approach things, the days we have been used to are numbered. Agents have got to be more accepting of the fact that we have got to give away information to stay relevant. We can’t be scared to post our buildings online because we fear that it may impact our tenant rep teams. Our tenant rep teams should be able to survive on good reputation and adding value to a service that is still required.
Lunson Mitchenall: Our industry is becoming more about advisory services than pure brokerage. Clients are looking to tap into our market experience and knowledge, to find creative ways to unlock value from their investments.
What will a commercial agent’s daily routine look like in 2040?
Lunson Mitchenall: We have seen enormous changes in the way we do business over the last 30 or so years. There are fewer agents completing a far higher number of transactions as we have become more efficient. Most of this has been driven through speed of communication. The retail sector has seen a seismic shift in consumer habits with multi- and omni-channel retailing becoming more prevalent.
Colliers International: I believe in 2040 we will still be viewing buildings with people. We will still be going round and advising our landlord clients how to refurbish their buildings, how to market them. The fundamentals of what we do today will still take place in 2040, just the processes in between will get shortened, and the amount of agents in the market will be significantly less.
Are there examples of tech already impacting the role?
Colliers International: It’s the internet, and it’s the websites that are on there. If you want to go and buy a house, where do you go? Right now it’s either Rightmove and Zoopla, and between the two, you probably get about 95% of availability for any given town or city. There is not a portal in the commercial world that offers that, and the reason it’s not happened is because the old school agents have been so protective of their information because they’re worried about their tenant rep teams. They’re now softening on that because of the ‘if-you-can’t-beat-them-join-them’ type mentality.
There are platforms like CoStar and Realla, where you can now get really good comprehensive availability for towns and cities on the commercial property front. You’ve got landlords marketing their space directly now, who can post on portals themselves, so the role of an agent is less required. You’ve got agents populating their own websites, their own social media accounts in a far more comprehensive way which means the amount of information out there is so much more than it’s ever been.
Lunson Mitchenall: Proptech is a growing sector, but it is hard to produce apps that can deal with very sector specific requirements. With shorter leases and a desire from landlords to see a varied tenant mix I can see the growth in apps that connect occupiers to property owners but principally for short-term and pop-up lettings. Having projects across the UK, technology allows us to view our clients’ shopping centres in real time and allows us to speed up and simplify retailers’ decision-making process.
What will be the benefits of going digital?
Lunson Mitchenall: There is a fine balance between relying on tech and providing clients with a reasoned opinion, I still believe the best way to communicate with our clients is to meet face-to-face, or at least speak on the phone. It is much easier to convey information, and move the conversation onto new areas that might result in additional business. I can see a situation where we become more integrated with clients in using tech to share information, which is critical to the process of agreeing deals.
Colliers International: For agents, it does make our life easier. There are a variety of platforms that we use, such as VTS and Realla, that really helps us organise our mandates and provide our clients with a better and more comprehensive service – but these are not mind-blowing from another sector’s position, we’re playing catch-up on the rest of the world. Commercial property seems to be 10 years behind where everyone else is, we’ve done a really good job over the last 10 years of trying to catch up but it’s still a little bit old fashioned in the way it behaves. I don’t think there’s any major benefits at the moment, yes there’s time saving, better reporting and doing more deals, and therefore more money but I’m not sure it’s necessarily about those benefits; it’s more about keeping up with your audience basically.
When do you expect to see the tipping point for adoption?
Colliers International: It’s happening now. There’s some market conditions, like the Brexit situation, which are unsettling and the market is a little bit fragile at the moment. I do think that we’re going to see a reduced headcount on the agency front because whenever there’s a downturn, numbers always decrease. What will be the difference this time is when the market improves, I don’t think the headcount will increase again. There are too many agents, and a combination of political and economic events, and an impact in structured technology, is going to really change the face of the agency world. The tipping point is starting to happen, I don’t think we’re at the cliff edge yet, but I do think within the next five years there’s going to be a really big shift.
There’s another factor, which is really important and not spoken about enough. Historically, you would either be a tenant who wanted serviced offices or a conventional space. You were either in one camp or in the other, and you never really hovered between the two. That wall is virtually non-existent now. Most occupiers and tenants today want conventional and serviced offices in the same brush because the actual offerings now are incredibly similar – both offer flexible space and turnkey, so the boundaries are no longer there. There’s approximately 1,000 agents in London that do conventional, 500 agents who do serviced office and they’re both oversubscribed anyway, and now that wall has come down, you’ve got way too many agents all doing the same things.
Lunson Mitchenall: There has been a significant take-up in tech over the past few years which has no doubt made us more efficient but has not fundamentally changed the role of a commercial property agent. I see this gradual adoption continuing without there ever being an absolute tipping point. Retail agency is an interesting and varied sector to work in, from a personal perspective I am delighted to accept technological improvements that make the job more efficient but wouldn’t want to be replaced by an app. With the changes we are seeing to the retail market, the property sector that serves it is at the forefront of the tech revolution, and as agents it is key that we do not become complacent.
Who will be the winners + losers?
Lunson Mitchenall: It’s important to not ignore the way the industry is changing, and be prepared to adapt. However, if you are offering nothing but a brokerage service you are at risk of being overtaken by technology. We pride ourselves on giving high quality advice, and negotiating complex transactions by building strong relationships with our clients.
Colliers International: The winners are the ones who embrace it, it’s really simple. If you embrace, if you can understand the changes that are occurring, and you can look at turning what are perceived weaknesses into your strengths, then you’re a winner. You will grow with the change, and if you grow quickly enough, you’ll find yourself in a really strong position when it has fully changed. It will be those ones that fight against change that will be the losers and those agents who are unaccepting of the new ways in which the market is going to behave, without a question.