As 3D technology races ahead in the communications, visual arts, and motion picture industries, the comparable impacts on transactional real estate are yet to be felt.
As the medical, architectural, and engineering professions have been irrevocably altered forever, so too will the real estate industry. The near “blockbuster movie” level quality of video imaging of real estate offerings available to buyers and sellers potentially will increase the velocity of real estate transactions. Until recently brokers, sellers, and buyers have relied on 2-dimensional depictions of properties as a way to market them. In order to conduct their due diligence, buyers were limited in their avenues to visualize first, what the property actually looked like, and second what it could look like if it were developed or redeveloped.
In days gone by the seller could convey static photography of the subject for sale properties. Today, the dynamic simulated flyovers and fly throughs utilizing Google Earth, drone aerial photography, and 3D computer technology have eclipsed that. The programs for the latter are too numerous to mention.
The latest iteration in this evolution is something called virtual reality. To illustrate this with a simple example, one can hearken back to the 1996 classic film Space Jam. Michael Jordan, the other actors, and the background were real but the animated Warner Bros. characters, such as Bugs Bunny and Elmer Fudd, were added “virtually” to the “reality” of what one was seeing on the screen. In other words, a make believe animation is immersed in the real setting captured during shooting. With today’s technology a movie studio, a staff of dozens, months of production time, and millions of dollars is no longer necessary to achieve these results.
Gone is the necessity for surveys and access to the property. Historically in the brokerage process, this has been a cumbersome, lengthy, and sometimes unwieldy task. So using site photography via Google Earth or by drone photography, the backdrop for the image creation becomes available. With these new tools, permission to gain access to the site is unnecessary. The cost of hiring a survey crew is eliminated. The as-built site can be modeled to less than a millimeter in accuracy.
The step of hiring a skilled architect also becomes unnecessary. Think about cut and paste. Particularly in the retail industry, what is there to differentiate one “cookie cutter” franchises’ building from another? What if one had a computer tablet of over 10,000 typical buildings? Need I name fast food chains, branch banks, national retail stores as well as hotel chains? Don’t they all, more or less, look the same?
The next step is you take these predesigned “Bugs Bunny animations” and immerse them in the captured images of the actual real estate property garnered via the techniques discussed above. It is not just the buildings that can be added to the property site but also landscaping, people, and moving vehicles. This gives the virtual reality even more of a “reality” feel.
The most compelling aspect of virtual reality is the speed and flexibility in preparing both the initial creation and the ability to change up the building type images as the buyer may demand. Whether it be multi-family housing, hospitality, office, retail, or educational uses, an almost unlimited array of prototype buildings exist to create futuristic video images of alternative development scenarios. What better way to establish highest and best use options, prepare financial proformas, or prepare prospectuses for investors and lenders?