After the last unpredictable 18 months, we wanted to spend some time talking to senior commercial real estate legal professionals to understand how the industry is faring in embracing digitisation, automation and artificial intelligence in the property transaction process.
Our research shows that the pandemic has had a huge impact on people’s thinking, with a significant 95% of professionals confirming that digitisation strategies have been accelerated as a result. It also highlighted gaps where further advances could now be made.
While just over a quarter (26%) confirmed they already have a defined digitisation roadmap, 38% said they are working on this now, and a further 31% said a plan would be developed within the next one to two years, so there is still plenty of opportunity for new initiatives.
However, the benefits of embracing digitisation are wide-reaching, with 71% confirming that advances here will provide their firm with a competitive advantage. A further 60% agreed that digitisation enables lawyers to evolve or upskill – with fewer manual interventions required, they can instead concentrate on more complex areas of law or on working more closely with clients.
There was, however, some hesitancy around AI and automation software. Just 12% confirmed they have already been using solutions for a year or more, and 71% said they are not currently using AI or systems to automate previously manual tasks, although a third are reviewing solutions with a view to launch within the coming 12 months.
Several challenges were cited, with more than half suggesting that the fast-paced nature of AI-led legal technology makes it difficult to scope. Just over two-fifths (43%) mentioned budgetary constraints and 40% felt that changing mindsets could be a potential challenge.
From our study, it is clear that by 2025, lawyers believe that more data and automation will play a part in speeding up commercial real estate transactions. Almost all the senior professionals we spoke to agreed that further change is coming, driven by legal tech, and I for one believe that the positives will outweigh the negatives. It is certainly an interesting time to be working in this sector.
Dr Thomas Quirke is managing director of SearchFlow