The arrival of the coronavirus pandemic threw just about everything into a state of uncertainty. Commercial real estate (CRE) was hit especially hard as the economic future of senior housing, retail and office space itself was uncertain.
To dig into some of the unique challenges facing the CRE space and opportunities that arose from the unexpected crisis, Procore recently hosted a roundtable featuring CRE leaders. Joining Procore’s Product Marketing Manager Jeremy Chasen, were panelists Marcus Motes, Senior Project Manager at Redstone Investments and Tim Allsopp, Director of Construction at Seasons Retirement Communities.
Commercial Real Estate is Evolving Coming out of the Pandemic
COVID-19 affected the real estate industry potentially more heavily than any other aspect of construction. Corporate office spaces were shut down and redesigned, while the needs of residential real estate shifted to provide a safer environment for residents.
To keep up with the changes crashing over the industry, Motes and Allsopp discuss how Procore helped replace outdated and disconnected processes. For Allsopp, the catalyst was disjointed communication and documentation that relied heavily on static documents.
“Excel, Word, email, PowerPoint, that’s how we communicated. The problem we had with it is that it’s always open to interpretation. Excel sheets can be amazing, but if one formula is out, that absolutely kills everything,” Allsopp said.
“What you find is inconsistency. If anyone jumps on that Excel sheet, you don’t know what’s changed, you don’t know how things have happened. Procore just consolidates it all.”
Organization and Efficiency Go Hand-in-Hand
At Redstone Investments, which develops and owns about four million square feet of office, industrial, retail and grocery-anchored shopping centers across the US, a need to improve the organization of their data was what prompted the 30-year old company to turn to Procore.
“We have a lot of data that we’re not leveraging, and we don’t really have a rock-solid process for how we organize that information and keep it rolling as something that can really be structured,” said Motes.
Improving Redstone’s ability to track and monitor financial information, without involving the accounting team, helped the company’s efforts to become more transparent.
“We wanted to improve the organization and also be able to have the numbers organized outside the accounting system. Not getting in there and messing with the accounting folks and what they’re doing, but still being organized and keeping a close eye on that information, tracking it going forward, and having a real jumping-off point for how we want to do that was really what we wanted to achieve,” added Motes.
Another way Procore helped Redstone become more efficient around data organization was decreasing its reliance on paper-based documentation.
“There’s the getting away from paper drawings, but even once you do that, there’s getting them organized and not just having them in ugly folders and random places on your computers. Drawings is one of the lowest-hanging fruits from an implementation standpoint, but it’s just such a huge win from an organization standpoint,” said Motes.
Organization and efficiency go hand-in-hand and the value offered by Procore quickly became apparent across the company.
“You have folks who maybe don’t touch the numbers as frequently and don’t have to deal with that side of it, but they’re still trying to get drawings in hand and circulate them to the right people. That’s the area where they said ‘yes, we’ve clearly upped our game by implementing this tool and moved the needle for our organization,” Motes explained.
Sometimes in construction the best way to anticipate what’s ahead is by looking to the past. Using Procore has enabled Motes’ and Allsopp’s companies to easily review data from previous projects and improve processes and performance on future ones.
“We get the answers, we understand how to get them. It’s not a case of ‘where’s the holdup?’ You can use on-the-spot referencing, then look back and ask, why did we make that decision? What did it cost us? How did that affect us?” explained Allsopp.
“Then we can even go as far as deficiencies and observations. What did we notice today on-site? There were three guys on a mobile phone, observations noted. We see it’s a trend, we’ve got to stop that, it’s a safety issue. Procore has been really helpful to us where things that would have just gone away from you and not really been a part of everyday workings are now visible, accountable, and everyone can see it.”
More Transparency = More Control
Seasons Retirement is a large developer, owner, and operator of senior living communities across Ontario and Alberta, Canada. Their development group works closely with their GCs to build their projects. The company enlisted Procore in part for better transparency and key insights.
“When we brought Procore on board, it gave us as the owner more control, just being more transparent with all the information that’s out there. We can look at some of the GC comments that were made when the owner wasn’t around. That might come up a year or two later and we were like, ‘why did we make that decision?’ No one knows, no one can fathom the logic behind it,” said Allsopp.
Procore helps Seasons decipher many of those questions.
“Everything is date-stamped, as an owner, we can always look back and understand our key KPIs or lessons learned. The information is there for us to see, not held in someone’s Dropbox or on someone’s PC who’s no longer with the company. Everything is just there, open and transparent,” Allsopp said.
Looking to the future, both Allsopp and Motes had no shortage of things they were looking forward to as their companies’ relationship with Procore deepens.
“We all hate change orders, the only thing I hate more than a change order is the same change order on a future project that I’ve had in the past,” said Motes.
“As we get organized with our commitments and change orders we can then take that and say alright, what did we miss on that one? How can we make sure we’ve got that included in the base scope? It’s the same thing with project cost. We’re feeding the machine with more and more information, to have that in a really clean manner we can reference at our fingertips is what I’m most excited about,” Motes explained.
Boosting Efficiency, Cutting Costs
One major challenge of the pandemic, particularly when it comes to organizing construction projects averaging 150,000 square feet, was keeping teams coordinated when travel was not possible. One way Allsopp helped his team navigate this was incorporating 360-degree photos and other project information into Procore.
“An architect is just able to zoom in, click on it, and he can see that certain elements are done or not, and write a review. It helps speed things up, and eventually it will be a little cheaper as well because we can save people from traveling as much, which comes off our budget,” said Allsopp.
Looking even further ahead, both men cited additional ways Procore will help their companies boost efficiency.
“A lot of our focus is on the automation of the estimating process and preliminary site design, and that’s easier with Procore,” Motes said.
“One of the biggest movers on the needle on our projects is definitely the site work component. We do a lot of similar types of designs, similar types of building costs, and so we’re as comfortable as you can be with everything that’s going on in the world right now with material lead times and lumber, which we all laugh about. Laugh and cry, I should say,” Motes said.
Allsopp touched on a key point to remember for companies getting started on their Procore journey.
“I think when we originally went for Procore, we understood what the benefits were and what we can achieve from it, but they don’t happen overnight, unfortunately. It’s not a turn-it-on and all of a sudden, you’ve got this information, you’re only as good as the information you put in.”
Building into the Future
Both Allsopp and Motes said they’re looking ahead to how emerging technology will help their companies perform even better.
Motes cited the ability for Redstone to leverage LIDAR and GIS information to more quickly put a detailed site design together internally instead of outsourcing the job, which he says will improve budgeting and shorten the bidding process.
“It’s something we are eager to get away from and I think we’re taking very tangible steps to get there. That’s something that excites us, being able to take that and reconcile it with all of this historical cost data is where a lot of our focus is and I think where it will continue to be,” he said.
For his part, Allsopp says Seasons is getting ever-closer to the ultimate goal of seamlessly unifying their data under a single platform.
“By 2025, I’m hoping all of our information is top-notch, amazing, and you can just pull from it. I would love to learn more about how we can benefit from [Procore Analytics], whether that’s on-site health and safety issues or why trends in construction are going certain ways. The more information we put in, the more we’re going to get out of it.