Harnessing the power of data is key to the future of the property legal sector

COMMENT As the UK economy adapts to the unprecedented impacts of the Covid-19 pandemic, the commercial real estate sector is shining bright and is contributing to the UK’s broader recovery. The latest investment trends highlight the boom that we are seeing in the commercial property sector. Investment volumes in commercial real estate – from offices to industrial – are on the up and show little sign of slowing. While the “return to the office” still seems to be far away on the horizon for many, investors remain confident that offices will still play an important role in working life. Demand for office space remains strong, and this is being spurred on by the attractive returns available to investors. This is particularly a characteristic of the London market, which continues to offer attractive deals compared with its European counterparts, with Brexit paying into this trend. Flexible market At the same time, there are considerable emerging signs of change and innovation in the use of property. For example, banks are increasingly entering the build-to-rent sector in the UK, and we are seeing the rise of commercial-to-residential conversions and the repurposing of older buildings that are already in the right places into sustainable and cost-effective offices. These trends have brought new dynamics and demands to the market as certain rules and restrictions have been loosened to create a more flexible property market. As the market continues to adapt and evolve, we are moving into a new world rather than re-entering the old one. Technology is on the cusp of a new decade of delivery in the servicing of commercial real estate investors’ needs. The pace of change is dramatic, and this is particularly evident in the groundswell of technology and innovation. New innovations are enabling the property sector to realise the gains talked about in the 2010s, when the likes of artificial intelligence and blockchain emerged as buzzwords. Such technologies are now becoming part of “business as usual” as more and more property professionals integrate data and technology into their day-to-day work. We have seen a rapid increase in the use of technology over the past five years, and this has been accelerated by the pandemic over the past 18 months. Every day, fewer people are relying on paper-based processes and more people are entering the workplace with the expectation that they will have access to technology and digital solutions. Ongoing investment Harnessing the power of data is central to the future of the property legal sector. Technology is there to help real estate lawyers keep up with the demands of their clients. In five, 10, 20 years’ time, there will be even more people expecting technology and data to be a key part of the commercial transaction process. To keep up with the rapid pace of change, it is important that legal firms no longer treat technology as a one-off investment but instead see it as an ongoing overhead that is part of their annual costs. Technology should not be seen as the end goal in itself, but instead it should be regularly integrated into law firms to help lawyers deliver on customers’ requirements, grow their business faster, do more and achieve greater things. There are so many game-changing technologies emerging right now – both inside the legal sector and elsewhere. I urge companies to bring on board people that are ready to challenge the existing ways of doing things. These people do not have to be technologists, but they should be people who are ready to challenge the status quo, no matter how uncomfortable this may be. There is a huge opportunity for lawyers to get on board early with the technological changes underway. We have seen in other areas, such as social media, where the law is catching up with the huge shifts in how we communicate. There are equally a broad range of innovations that are arriving now in the legal sector – from AI to blockchain. The time to prepare is now. Only by adopting an open, digital-first mindset will the property legal industry be able to unlock a more efficient and robust real estate sector that is fit for the future. Andrew Lloyd is managing director of Search Acumen  Photo © Search Acumen