Howard Berger: Bringing Industry Leaders Together for Innovation at RealComm

I am your host, Amy Peck. And today we have with us, one of my friends, my can call a friend Howard Berger, who is the managing partner at real com . Welcome.

So we started an investment commercial real estate firm , uh, down in long beach. And I soon discovered , uh, the how analog and how far behind the commercial and investment real estate industry was in terms of the document technology. So , uh, I saw a lot of opportunity given my it background at the time. And I got tied up.

I tied in with a startup up in LA that was producing digital data sets on large mainframes that mortgage companies and bankers and appraisal firms could use to better understand , uh, the industry really very, very deep , uh, data on properties, transactions, and whatnot , uh, that spanned the entire us. And they were updating this information everyday . Now this is mind you, this is 1987. This is like seven, seven years into my real estate career . Uh, and I just, I said, this is what we need.

Um, and so I , I started producing , uh , data such . We were later acquired by a series of companies , um, data quick experience then TRW , uh, the aerospace firm, and then later , uh , first American title. And now that they just said this called core logic , which you may have heard about, but now it's still in existence. So we were kind of the , the beginning stages of that. And during that journey, I mean, I'd say this is the early nineties.

Uh , I started producing some data for a gentleman named Jim young. Who's currently our real calm CEO. He was at that point chief information officer for Sperry Vanesa commercial services firm in Southern California. So we got to know each other and he said, you know, I have this idea. We've both kind of on the same path. He said, I want to start a consulting firm and I want to automate the commercial real estate industry. So I want to go into big companies.

I want to teach them how they can apply, how they can digitally transform everything about their operations, because it's coming, someone's got to do it. We've we've lived it. We can articulate. And I said, okay, that sounds like a great idea. So over on the side, I started consulting with CIM and did that for a few years and had some large international clients really, I think started just that process of the industry, understanding what PropTech is now , mind you, this is 19 93, 94.

Um, and so we did that for about seven years. And then in 99, we said, listen, you know, we're , we're going into all of these companies were writing these huge project , uh , you know , uh , you know, project scopes of work, half of the companies really aren't doing all of the things that we want them to do. Let's find the folks we're really get what we're talking about.

So what we decided to do is we , we launched a conference real common in 1999, and tagline was at the intersection of the technology automation innovations, the commercial and corporate real estate industries. And the idea was , um, we're going to find the top 3% of those companies. We focused on the big reefs on our developers, those folks that had an it staff , um , and somebody that was in charge of, and we, and , and at a very early stage, we said, you know, these companies are tremendously.

And like , I mean, they're doing million million dollar deals , uh , on the backs of napkins, they have no data. They're just totally disorganized. Um, their silo . They, they, they may understand, they may have a concept of what it is, but no concept of how to apply it to their organizations. Um, so we thought, geez , if we can find, if we can get them together and start creating an educational program, plus get them talking to each other.

Now at that point , uh , back now, we're talking early two thousands. Uh, if you were a large real estate organization and you wanted to start playing with technology, so, okay, we need a new financial system, or we want to manage our leases. There was really no place to go to get information. I mean, the internet was, I mean, you didn't have a Yelp where people could send in their reviews on a Yardi or an MRI, or, you know, a, a, some kind of a BIM program.

Uh, and folks typically weren't talking to each other because they all thought that technology was a competitive advantage. So we said, okay, we're going to go after the folks that are in charge of technology, they're going to be the agents of change for their organizations. And so we created a big group that community, so to speak of industry leaders in that. And then, so that , that kind of started us off.

And we , uh, we kind of grew, we started with back prophecy technologies, and then we just started going horizontally throughout the organization. Anything that touch technology was pretty much fair game. Then the thing that opened our eyes as we started traveling around the world, we started hearing what's going on in Asia. Uh, and we started to organizing trips to Asian companies. We did one trip, we did it, we did it a few of these.

When we bring , uh , folks from the industry, senior industry leaders, we bring , uh, developers, we bring some politicians sometime to come see what's going on with the rest of the world. So they could get an idea of what we weren't doing here and where we stood and getting to know kind of that continuum of deduction technology. And it was really an eye-opener .

We did a, I mean, the last one we did in Asia since probably the 2007 timeframe , uh, we visited eight countries, 32 projects, it was bang, bang, bang. Everyone was exhausted, but everyone said, they'd never seen anything like it. And the executives from Cisco came back and started this smart, connected building program and that kind of spread through it . It really catalyzed the industry. And we did the same thing in the middle east, did the same thing in Europe.

And that kind of level set us as to, you know, what, where the industry is going. When we learned about things like , um, all processes in a building being IQ enabled, and then being able to connect it to the internet. So that was really the first inspiration for what we would call the internet of things for buildings. We used to call it the IOT , the building internet of things. So stop me if I'm going too crazy.

security, their video cameras, they're all going to be IP enabled. If back in those days, they weren't, you know, they were just plugged in and they had an on-off switch. You know, maybe they had a, they had a dial to dial them up or dial them down, but they weren't computer controlled. And we knew that all of that data was going to be running over in networks .

So it's going to be important for everyone from the manufacturers like Johnson controls and Honeywell, sun Siemens, to the, you know , large reads Boston properties, petitions , and the , uh, you know, the Lendlease is an all day and all the folks that own and operate and develop real estate to understand that , uh, they are going to have to know they're going to have to start intersecting with that world.

And that the world of it was going to intersect or collide with a world of operational technologies that both are actually, they are, they're in different worlds. They speak different languages. They were going to have to start becoming brothers. Uh, you know, and , and so we started, I think we were , we catalyzed a lot of those conversations simply by finding the folks in the industry that were really at the leading edge of the spear . They were, they were really at the cutting edge.

They understood this, never taking risks to do this stuff and , and bring this stuff together and understand it and start actualizing it in their own companies . So that became our, our core community. It evolved into us launching the IB con conference, which now sits with real calm they're kind of twins. Um, uh, that , uh, that we host typically , uh, in June, of course last year kind of pushed us off our schedule a little bit.

Uh, and we're in November this year, but we're going to get back to our regular June schedule. And then , um, in addition to that, I've been doing these small regional events with CIOs and CTOs and CEOs and CEOs pretty much all over the world. I do have in the U S in Asia and in Europe , um, so that small regional groups can kind of understand what's going on around the world and we can help focus , uh , focus them on kind of the issues that , that , that, that challenge with regionally.

Uh, we do a bunch of rep webinars by one a week. And , uh, then we launched in 2010, a , a , a conference specifically for corporate real estate occupiers. This , the Googles, the Intels, the Microsoft, the bank of America , American express is a big corporate occupied . They're not, not the, not the landlords, but the tenants , uh, that occupied to do their businesses. And they usually have huge portfolios , uh, sometimes , uh , uh, some, some of the largest in the world.

So they needed their own conference. We run cortex Houston in the fall. Um, and , um , that's kind of kept us pretty busy , um, and , um , kept us at the edge, kept us connected with a community of who I would call doers. They're they, you know, they're, they're the three percenters, the two percenters that are really out there and making a difference and trying things. So , um, you know, I've been very fortunate , uh, to be able to be a managing partner.

I, I focus on the educational program, so I kind of figure out what we're going to talk about. We're going to bring in speakers. Um, and , um, I'm usually blessed with being able to find some of the best speakers in the world, like yourself name , uh, to , uh , uh, to help us develop our programs. And you had mentioned Denver, our hybrid conference , um, last year , uh, as a result of , uh, just a necessity to be able to do things differently. We , uh , uh, we decided to put a stake in the sand.

All the other industry association conferences were canceling for 2020. We said, listen, we are, we have to set an example for the industry. Uh, the folks that come to our conferences, they run buildings, people have to get into, back into buildings. We need to figure out a way to show them how , um, so we decided, listen, we're going to do a hybrid conference. We're going to have, it's going to be , uh , a combination hybrid being, we're going to have a live component.

People will actually be there participating. We're also going to open it up virtually. And what we did is we had two and a half days of a virtual event, all virtual , uh, 250 speakers, about 170 individual sessions , uh, done , uh, in a very engaging way. We literally scoured the world for a platform that we could do this on, and then we tore it apart and customized it , um, so that we could create something that folks would be comfortable dealing with.

And not just another , um , you know, virtual, it was just another crazy virtual platform. Um, and , uh , so we had two and a half days of virtual, and then we had our hybrid event , uh , in Denver, we took a ball room at the Gaylord Rockies, and we outfitted it like a , like a production studio, had an led wall. And , um, we, you know, we, we streamed, we broadcast, we hosted , uh , our live sessions there and , uh, we had a good mix of live versus versus remote.

And I think we did a good job at being able to make that hybrid , uh, feel engaging. Um, so that was our first attempt. Um, it took us, it was harder than I ever expected, took us , uh, it burned more brain cells than I normally would at a conference, but I think it was worth it. And we learned a lot doing it. And our, one of our main missions has been to share that knowledge with the industry, because we think that building owners need to know this stuff.

Uh , cause they're going to building owners and occupiers. They're going to need to be able to incorporate these types of technologies and strategies into their businesses and into their events and into the buildings. Leading by example,

We have software training, support consulting and custom development applied software. Has you absolutely covered for all of your workflow needs? And BIM designs is proud to be a client and partner of applied software to visit asti.com . That is eight S P I that com and please let them know that feature construct in Dem designs sent you no. And , and it was, it was so refreshing.

And I think I was actually at the airport for one of the digital panels and then got on a plane and came to Denver and that was there for the next day. And you know, it, it, it, I think it was really inspirational on , on a number of levels. I mean , content is always great, but you know, to , to show like, look, we can, we can actually do this and, and it, it, it can be successful and you can have meetings and you can be safe. And it was, and it was really, really well done.

And I remember, you know, all of the tables were, were sort of six feet in diameter. And so you could have four people that were kind of safely apart and you had some, some, some great technology there that that was , uh , you know , sort of brand new cutting edge safety technology , um, and then great sessions. So it was, you know, a half the operation that was, I know, I know I can imagine how hard it was and now you certainly verified that.

Um, and it was , I was really impressed with some of the companies that were there that were , you know, who were really low verging the technology. Um, but , but one of the things that I think that's remarkable in this industry, and I'd love to get your take on it is that you do have those who are out there kind of forging a path. Uh , but then you have others that are just kind of cleaning to these arcane systems, because it's just what they know.

And that's, it's kind of battling inertia, right. And it's going to be very difficult for them to, to, you know, compel their workforce to embrace the new technology, but also just really kind of create this , um, this change that needs to occur. And to your point, you know, across, you know , the , you know, every business unit within their companies. And so, you know, what , what are the companies that are getting it right? We don't have to name names.

Um, the , the companies are getting it right. We know what is the secret? I mean, is it really just start somewhere?

They have not automated payments. So it's just a couple of examples that what I think what it takes is there has to be someone in the organization with a vision. Um, and I think that they shouldn't have to, you know , it , at some level the , uh , the, the executive , the executive leadership , um, you know, has to, has to buy into it. Um, organizations are just really resistant to change.

Um, but if , uh, you know, I think in all, most of the examples that we've seen , um, uh, of companies being successful, there was a driver, there was a leader. Uh, there was a , there was an advocate who could articulate a business case, had the sense to be able to , um, uh, to able to organize projects in a way that they got small successes, they built up. Um, there was a , there was a science to, you know, to, to change and transformation.

Um, there'll be some organizations that will never, they'll never change until they have to, until they start losing business until their tenants stop, you know, stop , uh, uh, you know , uh, renewing their leases , uh, you know, until the list they start getting tons of complaints , uh , from , uh, from their tenants and from their visitors. Um, yeah. And then , and then there are other organizations that see the writing on the wall.

So, you know , I think it starts with , uh , you know, with an advocate with somebody who's really done that really understands and can articulate , um, you know, a good business case in the organization. I mean, I hate to say it, I mean, a good portion of our organization for the past 25 years has been older, white guys in their fifties and sixties and seventies , uh, that don't necessarily understand, you know , the trajectory of technology and what it can , uh, you know ,

Um, but, but how do you think of this, you know, will , will impact just the use of space and how will technology kind of help us define, again, you did a , you know, you did a hybrid event, but, but really when you think about hybrid workforces, I mean, construction requires people to be onsite. Of course. Um, but for those who don't know, what do you see as some of the technologies that are emerging to, to support this kind of fractious workforce?

A office was , uh, you know , uh , kind of level that you were , you're talking with 60% occupancy. So there were indications whether it was in retail or an office , um, that we might've been overbuilt. You know, we started out , uh , 253 square feet for a person working in a building at an office. And we started organizing cute farms back in the sixties. People went down to a hundred square feet.

Uh, then we went to an open office concept , uh, questionable whether that was whether that really helped utilization , uh, kind of move to activity based work. I think , um, you know, I think right now what we came to a huge realization, our workforce can go Q2 due to realization and did the executives , um, who both build buildings and operate buildings that people can work remotely. They can work out of their homes.

Um, and there's a good portion of the workforce that said we really liked working out of our homes. We, you know, in some cases we like working out of our homes more than we do schlepping into an office , uh, every day and working there. I think we're in a transition period right now. A lot of folks were a lot of , um , uh, corporate occupiers were looking to open up their offices and start flowing back in workers. First.

It was June 15th now , uh, now it's after labor day, summer at the end of the year, some folks who are looking at June, 2020 to get up to that 50% level, I don't think we really know how it's going to go yet. I think there are, there are still more questions than answers, but we have learned that not everyone has to be in an office. Um, there are people that have to collaborate. Uh , our constructions workers have to be on the site.

Um, you know, engineers working on projects have to collaborate. There are times in very creative positions, those spontaneous collaborations that happen in the hall there , they , they make the difference between success and not having success, but just the account and to have to be in the office, do the back office workers need to be in the office.

They need collaborative technology so that they can have a meeting and, you know, and will it look like, you know, I think a lot of corporations are looking more at that 3, 2, 2, 3 days in the office, two days home, two days off. Um, is that realistic? I mean, it , it sounds like it makes sense, but it's still that won't work for everybody. There, there is a percentage or a percentage of folks that absolutely want to be back in the office.

There are a percentage of folks that have said my lifestyle has shifted. I actually want to work at home. I can do get just as much done. And there are arguments on both sides where the productivity improves or , uh , is, is impaired , uh, by remote work . I think this is all playing out in front of our eyes right now. And I think we'll know we'll have a much better idea.

Um, you know, how the science of how the science hybrid is going to evolve, but I think it will require technologies that will require a new understanding of how we look at work, how we measure work. Um, and , uh, just to just that whole , uh, you know , and what we need to do to attract people back to the workplace. Yeah.

And then, you know, it's , everyone started working from home , uh, you know, on a daily basis and got to see their families for some people that was a blessing and a curse, but you know, what , what was really nice about it is, you know, you know, you be on a call, you know , really serious call on . And then all of a sudden someone's like cat walk across their keyboard and , you know, you'd see this like tail go across the screen.

And I think we were reminded that, you know, we're just people, right. We're and we're all sort of connected.

And by focusing on that, rather than just the productivity metric that will in fact benefit the productivity metric, because you're going to have a happier workforce and therefore they will be more productive, but it's kind of a big science project.

And so , uh, you know, so those folks that are responsible for workplace design and strategy , uh, you know, are looking at things like , um, is this a healthy working environment , um, you know, indoor air quality , uh, is it what it should be , uh, you know, so folks feel safe. Um , they feel healthy , they feel safe. Um, are they making the right connections? Are they , uh , do they have the supportive technology here to do simple, to do collaborative work?

I mean, it's, it's, it's one thing doing zoom calls on a , you know, on your laptop, but can I create a better experience here in the office? That's more immersive , uh, connects us in ways that we really can't do as well on the small screen. Um, and, and that enhances that whole, the whole collaborative effort.

So I think , um, you know, both landlords who build the buildings and , uh , kind of maintain that space for, for the occupiers who have the, have the employees , um, starting to have some kind of interesting conversations on how they can work together to just enhance the experience from the time , uh, you know, the employee or the visitor, or the occupant walks through the doors .

And before they walked through the door and they go through the act, they go through the lobby and the , and the, in the, in the gateway and the elevator going up to the office , um, that they , they, they create just a whole envelope of , uh , enhanced experience and starting to see those, those conversations now , um, you know, the question is what we, how will that impact how we use space?

Um, you know, if we were only at 60% utilization in 2019 , um, what is that going to do to utilization now, what's that going to do to portfolio rationalization and resizing in the future? Um, our we're still building buildings. Do we really need all that space? If we do what happens to all of the class B and class C space that doesn't get improved? Um, what do we, what do we do with that? I mean, do we turn that into, you know, into a affordable, affordable housing?

You're all able to work on the same designs. I mean, you know, they, you see industry as a 3d industry, right? That's been, that's managed to, to teach itself how to be effective in the 2d world. And, you know, these 3d environments require one thing that we haven't always had an offices that we have now and that space, right. And we can have even a holodeck now, you know, you can have a whole room that's dedicated to this immersive collaboration.

So I'm kind of hoping that, that we see more of that in , in the coming years.

I mean, you need to have a production studio , uh , with green screen and a large led wall and full motion AR VR , uh, you know, in your building as an amenity for your tenants, because they're going to want to use this stuff for collaboration. Um, you know, we've played around with the idea of , uh, you know, kind of creating a, creating, not a studio in a box

But, you know, imagine being able to have these virtual meetings where you're actually looking at somebody that's not just an avatar, you know, it's , it's their , it's their home .

They're, full-size , this is one of the things we're playing around with , uh, for our event this week is making people, absolutely lifestyles bringing the led wall down to the floor, so that if I'm standing up in front of that led wall, I can be talking to someone remotely is they're the same size as I am. And it looks like we're having a conversation. Um, I mean,

I think anyway, as have something have a device that it doesn't just actually translate verbatim, the words that they're saying, but it , it, it tells you about really what they're thinking and what's in their heart and, and you really get a , you really get a peek into where somebody really is at , uh, you know, both spiritually, mentally and emotional. Um, I think that would be kind of cool.

Cause I think , uh, in a lot of cases, our , our verbal communications is we, we either don't take the time and I'm guilty of this , uh, to really articulate , uh, what we mean and what we feel. And I I'd love to see something that helps us connect more on a human level.

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