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5 ways AI is creating new demand in commercial real estate

  • Writer: Team CapStack
    Team CapStack
  • Aug 17, 2023
  • 3 min read

According to JLL a slate of untapped opportunities are emerging in real estate thanks to AI.


CapStack has been instrumental in helping clients secure optimal debt solutions for their diverse real estate projects and acquisitions
CapStack has been instrumental in helping clients secure optimal debt solutions for their diverse real estate projects and acquisitions.

According to Yuehan Wang, Real Estate Technology at JLL.

“AI has enormous potential to reshape real estate, with near- and long-term impacts ranging from the emergence of new markets and asset types to innovations in investment and revenue models…A rapidly expanding AI ecosystem and its supporting infrastructure will drive new demand for real estate in different markets globally.”

Read on for five areas where AI’s rapid development is having an effect.


1. AI Clusters in Established Tech Markets




“The need for specialized skillsets will only rise with the advent of AI. The war for talent is already driving decision-making for AI companies and investors on where best to establish operations. Companies have been sprouting up in established markets, often within major technology hubs and in close proximity to top academic institutions, to tap into the technology ecosystem and a ready crop of AI engineers and technical talent.”

2. Data Center Development




AI’s huge data processing and storage requirements has put data center development into the spotlight, with data demand and appetite only going to increase. According to JLL data “the number of hyperscale sites in development is expected to double by 2024, up from 500 sites just five years ago” and crucially these new projects are being built with a focus on sustainability and energy efficiency.

3. Smart buildings powered by AI




Developers are focused on building smart buildings - based on smart technologies and powered by AI.


Albert Ovidi, Chief Operating Officer, Markets, Asia Pacific, JLL, says: “With all generative AI applications, the key for real estate owners and users will be to create the right prompts to connect insights across essential elements such as human experience, real estate performance, and sustainability to learn and address new opportunities…Another key opportunity is to further integrate AI with existing technologies such as robotics, drones, and digital humans to “see” different parts of a building and improve feedback and communication with the building and its users.”


Examples include using AI to “identify, interpret, and integrate data from disparate building systems, equipment, and devices.”

4. New Investment and Revenue Opportunities



Property analytics and transaction speeds are both improving due to AI given its ability “scan data and find meaningful patterns at speed means” allowing it to provide recommendations “aligned with an investor's objectives, risk tolerance, and market conditions”.


5. Experience-Driven Design and Space Functions



Workplace enhancements and improvements in user experiences are also occurring thanks to AI allowing for “a greater degree of personalization in the office environment.”

Albert Ovidi, Chief Operating Officer, Markets, Asia Pacific, JLL, says: “What AI is able to do is to connect the cognitive data we collect from users with the physical data on usage patterns and human behavior before making sense of it and recommending better insights on how we can run offices, I believe the workplace should align with people’s experience of technology in their daily lives as personal, useful, and easy. And I believe AI can help meet that expectation.”


When it comes to securing the right financing for your commercial property acquisitions and projects in Australia, CapStack is the partner you can trust. With unparalleled expertise, a vast network of lenders, personalised service, and data-backed insights, we are committed to helping you achieve real estate success. Get in touch with CapStack today and unlock the full potential of your commercial ventures with our expert property finance services.




When it comes to the financing options it pays to speak to the experts. By working with the CapStack team, you can avoid the hassles and headaches of dealing directly with lenders while gaining access to a wider range of financing options and expert guidance through the process. We can handle the entire financing process for you, from reviewing your needs, analysing the best options, submitting your loan application to negotiating terms and closing the deal.


CapStack can assist with bank, non-bank, or private financing. Start here to connect with us and send through some basic information to get the ball rolling or email us directly. Our lenders are Australia-wide and ready to fund investments acquisitions and development projects. CapStack help's developers and investors fill their capital stack by providing access to the capital puzzle piece they are missing. CapStack works directly with developers and investors who need access to capital markets.


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