The Value of Location Data
Technology can make the world seem like a smaller place but, in real estate, location still reigns supreme.
The analysis and application of data are hot topics across business sectors. It's an understatement to say Jack Dangermond was ahead of the field in understanding the importance and potential of data in real estate. In 1969, he founded Esri (Environmental Systems Research Institute), the California-based supplier of geographic information system (GIS) software that is currently the dominant player in the market.
Knowledge is power - and GIS allows commercial real estate professionals to understand complex variables that impact a property's worth and potential.
“In real estate, more than almost any other field, location matters,” Dangermond says. “While there is a lot of talk about everything going to the web, people still want to visit retail outlets, experience products, and get a sense of what they are buying.”
The Amazon effect is changing retail, warehousing, and logistics, meaning the market is responding to the disruption.
“In the last several years, we have noticed a lot of manufacturers building brick-and-mortar retail stores that represent their brand and allow customers to have direct interaction with them,” Dangermond says. “Relocating these facilities is enormously important.”
Esri established itself as an industry leader decades ago, but Dangermond cites a dedication to research and development as a primary reason the firm has remained atop a tech-driven market.
“From our outset over 50 years ago, we continuously aspired to push ahead with new thinking and innovation,” Dangermond says. “Money helps, of course. We spend approximately 30 percent of our ongoing revenue on innovation of various types. We also organize Esri into teams that work closely with each other and have a focus on making their users successful. This combination of end-user focus and pure interest in advancing our platform with the latest technologies has tended to inspire our product engineers and developers to push forward year after year.”
The personalization of technology, with everyone holding a veritable computer in a pocket or a purse, has opened new avenues for tech companies to interact with consumers. But with accessibility comes competition, which Dangermond sees as a driving force to make software products that are easy to use while also capable of delivering exceptional benefits.
“At this point, Esri is growing over 10 percent per year and, at the same time, making our technologies easier and more accessible for end users,” he says. “We see an enormous expansion in our market, largely caused by the new generation of web GIS and mapping tools. We believe that our customers will double or even quadruple in the next few years resulting from easier tools and a more geospatially literate workforce.
“Within the real estate community, we now see people who are wanting access to all types of geospatial assessment from their mobile devices, and this is now entirely possible. Location tracking of people, understanding a location in reference to all its surrounding geographic forces, and predicting into the future what will happen are all on our horizon for empowering the commercial real estate professional.”
Smart devices, after all, should aid the decision-making of smart users.
Hear more from Dangermond in his keynote presentation at the 2019 CCIM Global Conference, Oct. 13-14, in San Diego. For more information, visit conference.ccim.com.