Home » The future of proptech and AI: An interview with RICS’ Andrew Knight

The future of proptech and AI: An interview with RICS’ Andrew Knight

by Tim Clark
A representation of AI interacting with a house

Earlier this year, the Royal Institute for Chartered Surveyors (RICS) launched a report on the changing nature of proptech, as well as artificial intelligence (AI) and the potential impacts on the built environment. 

AI is expected to play a role in data analytics and information modelling and support decision-making and understanding complex scenarios – although, it is likely already doing so in some areas.

The property sector and the quest to improve ESG credentials could push AI use even further as property owners seek to adopt new technologies to improve their building performance. 

In light of this and to understand how AI could shape the future of real estate and new building projects, Build in Digital spoke with the author of the report, RICS’ Global Data and Tech lead, Andrew Knight.

What level is the construction and property industry at when it comes to using AI?

Andrew Knight, RICS

AI is now incredibly pervasive in the sense that people are using it in so many different products, whether it’s controlling the heating and ventilation system, whether it’s using it to look at data sources to aggregate data to analyse data to do analytics.

And as you know, the real estate sector is in some respects, still very kind of archaic and poor in terms of the quality of data that’s out there. Also, from a behavioural point of view, not particularly keen to share it often as well. So, data is often siloed and not particularly well structured, and not even available digitally.

How will AI help solve some of those problems?

AI can help because it can do natural language processing, it can extract data from documents, it can pull different data sources together and can look at the quality of data that people have.

What’s really interesting is that, in a sense, AI is so pervasive and is going to help in so many ways, it could revolutionise the sector. The flip side of that is that people will need the ability to interpret what AI might be doing.

RICS members work in a commercial setting so they have to explain their work. They can’t simply say, “Oh, well, here’s the result, it came out [of an] AI black box.” Ultimately, they could be standing up in court defending their advice and defending their decisions, particularly in the valuation space.

When it comes to property and construction, how do you see people ending up in court, either over AI use or interpretation?

It’s important that AI is not only used responsibly but that we can interrogate and understand how AI is presenting information that it’s used to control things. At one end of the spectrum, it might be simply controlling your office’s temperature, which is great; you’re saving money, no problem.

If you’re using it to provide advice or do analytics on how much it might cost to renovate a building or to do a new development or  pay to buy a property, then clearly there’s a huge risk factor there. You would expect that AI would need to be interpreted so that people can have comfort in the kind of results they are seeing.

“The brutal reality is that if you’re a valuer and you produce a valuation for a bank or for an asset manager, and it’s wildly wrong, you will get sued”

When it comes to digital projects, or valuations, could people realistically get into legal trouble? The reality is that AI doesn’t exist in some sort of cyber world. The brutal reality is that if you’re a valuer and you produce a valuation for a bank or for an asset manager, and it’s wildly wrong, you will get sued.

You can’t just tell a judge or an adjudicator, “I put in the address and it [AI] said £10m.” Your PI insurer will say that’s not good enough. 

One of the main challenges for AI could be to understand the technology and use it to solve a real problem for a business, I guess?

It’s separating the fact that digitisation is not an IT issue, it’s a business issue. It’s not a case of just digitising a current process. It’s about saying, actually, is there a better way to do this? And would digitisation help us achieve that? You don’t replace a poor existing process with an equivalent digital process; you think about how as an individual or a business can you reimagine it and do it differently using technology.

Ultimately, this should be about the clients such as you or I buying a house, or a government building infrastructure or a corporate client building a new development. It’s about the people who use and consume real estate getting a better outcome. 

How can AI help with the biggest challenges facing the real estate sector, such as ESG or carbon emissions?

One of the challenges I would highlight is the whole learning platform that is ESG. How do we stop the 40% of emissions that come from real estate? How do we really do that? One can get very excited about all these new smart buildings such as 22 Bishopsgate, but the challenge is this long tail of buildings that are already out there, such as schools or offices out in regional areas. They’re not in some shiny central business district, but they’re the ones producing so much of the emissions.

Whilst it’s great to have these new shiny buildings in the city that have you know, a BREEAM, rating, what about the 99% of the rest of the building stock that needs to be similarly kind of made smarter and more efficient and have this done in a cost-effective way?

This is an area where big data and technology should help, but it needs to reach that long tail of existing smaller assets.

Is this where AI could be most effective, by tackling that long tail of buildings which need improvement?

Arguably, yes, it can make a difference. With cheaper sensors, and with off-the-shelf type of AI, which is used as a service, you imagine a kind of democratisation of data and tech, which would allow it to be made available to the smallest asset owner.

Building owners can use inexpensive sensors on air quality, temperature, or similar and plug into an AI service, which can then feed back into your air conditioning, and you suddenly save an awful lot on your energy costs. Simple things that can make that difference on scale is where it will be useful.

New technologies can often take a while to bed in, with AI are people still exploring where it will create the most value?

In some respects, people slightly like a Terminator 2 syndrome where AI is going to take over the world and make us all redundant. I’m not being overly optimistic that it isn’t going to do that but I think that AI will be more prosaic. It will take meeting notes for us or do those under-the-bonnet things in a non flashy way, but actually very clever way.

“You won’t lose your job to AI, but you may lose it to someone else who uses AI”

But it won’t be replacing us when we sit in a meeting and talk to our clients, or taking notes or a transcription. That isn’t Terminator 2, it is an evolution of the dictaphone. As someone said, you won’t lose your job to AI, but you may lose it to someone else who uses AI.

It feels like the whole concept of AI has only really caught on since the end of last year with the launch of Chat GPT 3. Has that had an effect from your perspective?

Chat GPT has been good in the sense it’s brought it into the public domain a lot more strongly, because people don’t realise that when you get your Netflix recommendation, they’re using AI not just to select the movie that they want you to watch, but they’re showing you pictures of the movie that are relevant given the kind of movies you’ve previously watched. They’ll choose subtle images of the movie to show you as that as the kind of clickbait based on your preferences. 

It is much more subtle, but AI is under the bonnet in so many different products, from councils using chatbots, and sometimes it can be quite clunky and get things hilariously wrong.

Where do you see the property market itself, as the RICS report gave a good snapshot of the sector?

I think where we are is that there is so much opportunity [for AI], to improve the way real estate works and also because the property lifecycle is so broad, and hopefully the RICS report brings that out. You’ve got people looking at the construction at land acquisition at planning and financing. 

Property is the world’s biggest asset type, and there is almost infinite demand in the short to medium term, as there is simply so much to do.

Main image: DALL.E

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