The commercial real estate (CRE) industry faces a wave of change in the next several years. From payment forms and innovations to new security threats, the modern CRE manager must tend to a variety of new challenges. However, there is reason for optimism in these changes. While the pace of change is unending, there are steps CRE managers can take to keep up with industry innovations.
This year, U.S. Bank once again hosted CRE representatives from across the country at our annual client conference. The theme, Expanding the Possibilities, solidifies our mission of opening new opportunities with advanced technology. However, there are still many questions about how these innovations work in a practical sense.
Opened by U.S. Bank head of Commercial Real Estate Rex Rudy, and sponsored by Nexus, Visa and Chrome River, the conference offered attendees a chance to network and learn about driving factors in the industry. For those who could not attend – or for those who need a refresher – here is a summary of the topics discussed at the conference.
We’ve seen dramatic change in the payments space in the past few years. For the longest time, most payments were conducted by standard check or cash. Now, modern payments technology has fundamentally changed how we process and accept payments from tenants and vendors.
Sayantan Chakraborty, head of Global Treasury Management product management at U.S. Bank, noted that these changes must be viewed in practical context for best results.
“We are already seeing some of this transformation,” Chakraborty said. “This is the most impactful time for the industry in the past 20 years. While there’s never a good time for change, we want to spend time on how to make it practical and useful. How do we these new payment rails work to solve real business problems?”
Chakraborty and Bradley Matthews, head of product management and marketing for U.S. Bank Corporate Payment Systems, conducted an open panel on the varied types of technology trends. For Matthews, faster payments and APIs were especially important in the near-term.
“These new payment rails have great capabilities over time, but that growth also enables us to solve new problems in the short-term,” Matthews said. “Take mobile payments, for example. We’re missing an opportunity because of what the mobile device provides from the customer, including geolocation and additional behavioral data.”
Several attendees expressed concern about the economic outlook in the short-term, with most anticipating a recession hitting within the next 12-24 months. Despite this guarded outlook, U.S. Bank executive vice president John Stern offered a more balanced view on the state of the economy.
“While the global economic growth rate is slowing down, the U.S. dollar still shows signs of dominance,” Stern said. “As a result, the U.S. economy is becoming less dependent on exports. The labor market also shows no signs yet of declining.”
Stern expressly mentioned the rise of negative rates, which has taken off in Europe but not in the U.S.
“Negative rates are already happening across the globe, especially within the European Union,” Stern said. “Can they happen here? While there are some academically appealing reasons to take them seriously, there are also risk factors. There would need to be widespread consumer education for this to take place.”
In 2013, Apple released their (successful) iPhone 6 and Google unveiled their (less successful) Glass augmented reality system. This occurred during an age of device enablement, where organizations slowly granted greater power to consumers for accessing account information. Since this initial push, demand for digital wallet use has exploded. Dominic Venturo, chief innovation officer at U.S. Bank, notes how this initial push has led us to a world where all emerging technology is aimed at seamless integration.
“Five years ago, API development kits for augmented reality didn’t exist,” Venturo said. “All data have to be recreated manually, and location services drained the batteries of older phones. Today, location services are far more reliable and real-time video rendering is more possible at faster speeds. Combined with the increased use of mobile devices at point-of-sale, the goal of emerging tech should be to provide ready access to available data with speed, control, and security.”
As new technologies take hold in the marketplace, organizations continue to balance business/customer needs with internal security concerns. Business email compromise (BEC) continues to be one of the largest drivers of financial fraud, accounting for $12.5 billion in exposed dollar losses between 2013 and 2018.
Tim Held, chief information security officer at U.S. Bank, and Jake Bernier, info security architect, showed live demos of how BEC attacks function in the workplace. One of the most common, “The Executive Masquerade,” spoofs the email accounts of high-level business executives and urgently requests funds. Cybercriminals are unfortunately becoming more adept at these spoofs, to the point where they can commandeer an employee’s email account and send attacks without the employee’s knowledge.
“The first remedy for these types of attacks is awareness,” Held said. “Don’t use free web-based accounts and consider buying domain names that are like your own, perhaps with one or two letters misspelled. Make sure two-factor authentication is implemented on the corporate and vendor sides as well.”
Exploring the potential of robotics and artificial intelligence
Will there come a day when artificial intelligence and automated processes transform the way payments are made? That day may come sooner than you think. Robotic process automation (RPA), defined by its combination of technology, business logic and structured inputs, can fundamentally reshape how data is collected and processed.
Dhiren Patel, central regional manager for deposit and payment solutions at U.S. Bank, moderated a panel of business intelligence experts who shared the main benefits of RPA within emerging technology.
RPA has the potential to reduce costs through automation of traditionally manual labor/non-labor tasks, the panel mentioned. It can also help reduce errors by eliminating human data entry requirements, encourage more value-added activities, reduce IT needs at the back end and ensure better compliance with security needs.
For those in the commercial real estate industry who finds themselves struggling against these new changes, we can help. Contact your commercial real estate relationship manager today for insights on managing the pace of emerging technology.