The True Intelligence of Artificial Intelligence in the Real Estate Industry: Video

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From left: Joseph Graziose, Vaughn Ratchford, Randy Salvatore and Sifo Simela. Photo by Diana Castillo.

Artificial intelligence (AI) was a major theme when Westfair Communications hosted its latest forum, Driving Innovation in the Real Estate Industry. While panelists acknowledged the importance of keeping up with technological advancements, they made it clear that the human element, rather than technology, should take precedence in decision-making.

Panelists are Joseph Graziose, executive vice president of development services at RXR, Vaughn Ratchford, senior vice president and chief real estate officer at New York Blood Center, Randy Salvatore, founder and CEO of RMS Companies, and Sipho Simela, founder and CEO of Matrix Rental Solutions. Moderator is Tim Foley, CEO and executive vice president at the Building & Realty Institute.

“AI plays a big role in our company,” Simera says. “Just automating certain tasks has helped us surpass our capabilities.”

Simera explained that Matrix Rental hired an outside company to create a system to extract data from documents and verify their legitimacy through metadata, eliminating a time-consuming process that had to be done manually and that sometimes led to lost rental income due to fraud.

“We also use AI to verify income and employment. We call it 'cross-source verification.' Once we've stripped down all the transactions from the bank statement, we compare the account holder to the name on a driver's license or the name on a pay stub. We can do some really interesting checks where we can verify the authenticity of documents and identities, but also do calculations that take a lot of people's time and a lot of staff. We're automating every part of the process to get housing to more people.”

Salvatore said that when his sons joined RMS, they began to thoroughly research software to help set rents, but stopped the investigation when lawsuits based on allegations of price fixing through the use of pricing software began to surface.

Graziose said RXR has embraced technology but at the same time hasn't eliminated the human element.

“We're not going to just 'set it and forget it,' and we're not going to rely solely on technology,” Graziose says. “One of the things we've done at RXR over the last five years is we've developed our own digital lab and we've put some data scientists in there and their sole job is to look at real estate technology and AI opportunities and how that can enhance what we do as owner-operators and developers. We're not going to say, 'Technology calls for X, so we're going to do it.'”

Graziose said RXR evaluates the market daily. They see ongoing changes in project and property management as an opportunity to leverage AI, but they want to have humans behind it, so they're keeping an eye on the technology as more is deployed. They want to make sure the information that's “spit out” by the technology is accurate, is information they agree with, and is ethical, he said.

“We want to make sure that the results we're setting as an organization and what we're sending out as a brand and, more importantly, as community leaders, are right,” Graziose said.

Salvatore said technology and AI are different things, and RMS is embracing both.

“Especially in hotels, there's a lot of tasks and organization — cleaning rooms, determining what's clean and what's not, checking guests in — so of course we employ technology where it makes sense. AI is an extension of that,” Salvatore says. “What we're really mindful of, whether it's a hotel or an apartment, is that we're selling a lifestyle rather than a building. We're careful not to replace the human part. I think what we're really doing is reusing the human element to save time on the mundane tasks. For example, in a hotel, we might have had an extra front desk agent, but thanks to technology and systems, that person is now a concierge roaming the lobby, greeting guests and asking if there's anything they can help with.”

Salvatore said technology isn't advanced enough in apartment buildings for computer systems to handle any complaints or issues without residents having to call and speak to a human being, a situation he said could change in a year or two.

“We're looking at when that will happen, and we think it will free up our leasing and management staff from dealing with day-to-day resident issues that can be addressed with technology,” Salvatore said. “They'll become ambassadors for the community, act as concierges for our buildings and organize more events for the community. We don't see this necessarily as a cost-cutting measure, but rather a redirection of the workforce to create a better lifestyle for our hotel guests and apartment residents.”

Latchford said New York Blood Center is in the early stages of exploring AI adoption across various business units, but is applying it to its real estate portfolio of 75 properties in 15 states. He said the company relies heavily on evaluating data that shows whether there are enough blood donors in an area when scouting locations for blood donation centers.

“This is all data we sift through when determining if a space is suitable for rent or purchase,” Latchford said. “It's about truly understanding the data and where it leads us.”

Latchford said blood centres have to store and manage large amounts of data, including information on donors as well as various blood products and their distribution to hospitals.

“When you think about where we're actually going to do the testing, processing and distribution, proximity to hospitals is one of the most important factors in choosing a location,” Latchford said. “Having the space to set up the mobile drive, position the vehicles and equipment, and bring what we collect back to our headquarters. All of those factors come into play when we're choosing a location.”

The Westfair Business Journal event was held at the CV Rich Mansion in White Plains.

Silver sponsors were The Cappelli Organization and RMS Companies.

Bronze sponsors are BRI (The Building & Realty Institute), Cuddy + Feder LLP, Consigli Construction Company Inc., DelBello Donnellan Weingarten Wise & Wiederkehr LLP, Fordham Real Estate Institute, GDC Ginsburg Development Companies and Turner.

Backers include M&T Bank, Action Entertainment, Sharc Creative, Spinnaker Real Estate Partners LLC, Rakow Commercial Realty Group and Langan Engineering.

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