(NEW YORK, NY) — I had the pleasure of speaking with the President of Helmsley Spear, Kent M. Swig, about the firm’s investment in blockchain technology and the data revolution that is taking over the real estate industry.
Blockchain technology is expected to grow in value to $9.7 billion by 2021. It will allow real estate companies to record property transactions, improve property search processes, speed up pre-lease due diligence, and maintain leasing and property management information.
“Changing real estate trends, intense competition and increasingly complex financial considerations require an understanding of investment and management risk and rewards,” said Kent.
Helmsley’s recently announced its collaboration with Hercules SEZC, a blockchain-based supply chain software company. The technology will be used in the initial phase of documenting rent rolls for the company’s commercial leases and will provide confidentiality and indisputable historical building documentation for two of its properties in Lower Manhattan.
Founded in 1866, Helmsley Spear, the oldest operating firm in the country, is putting the most sophisticated technology to use. It is a beautiful juxtaposition.
What role does blockchain play at Helmsley spear? and why are so many people and industries hesitant to adopt it?
Blockchain is another form of of storing information. It is most often shared publicly, but it doesn’t have to be. For Helmsley, when our information is stored on blockchain, we rest assured that it is verified and cannot be changed. This technology is the most efficient way to store our data because our projects call for a lot of documentation. For example, when we are representing investors, there are a lot of leases, rent rolls, zoning permits, etc., that need to be stored and easily accessible. It is both expensive and time costly to manage the information and those who are allowed access to it. However, blockchain offers an inexpensive, simple solution to the mess. By setting up blockchain nobody can manipulate the data, therefore it does not matter who has access to it.
Can you talk about your recent partnership with Hercules SEZ?
Hercules SEZ is a company that is heavily involved in digital currency. They perfected their practice and have figured out how to take blockchain to other industries. I have worked with them on personal endeavors in the past and when they approached me with the idea of taking blockchain to the real estate industry I agreed. Our partnership with them has proven effective and has given us the ability to secure our data in the most effective way. As we continue with this partnership, we will look for ways to adopt blockchain into other areas of our work at Helmsley.
Why are so many people and industries hesitant to adopt blockchain?
The reason why most people and industries are hesitant to adopt blockchain is because they are mislead about its purpose. It has become a common misconception that blockchain is used solely for public enterprise. People are associating blockchain with the public aspect. It isn’t public all the time. Users can determine whether they want to disclose the information publicly or privately. And, even when information is disclosed to the public, crucial elements like the buyer’s identity and information are never revealed. Another crucial element to understand is that blockchain is not synonymous with cryptocurrency. Blockchain is simply a method of storing and retrieving data. It is often paired with a digital, but it does not have to be.
Can you discuss blockchain’s role in the real estate industry?
Once the industry fully adopts blockchain, we will be able to see what buildings are being sold, for how much, and what currency is being used to buy it. Blockchain will become the most transparent way to sell real estate. Data and statistics will be much more valuable as transaction information will become easily accessible. Information and documents will be securely stored in one space which will not only make things easier for the brokers involved in the transaction, but the clients will find it to be cost and time effective as well.
Thoughts on cryptocurrency?
I have recently jumped into the digital world, so i’m just beginning to learn about it. But digital currency is and will continue to revolutionize the way of trading. Every item that is bought in the digital world is a piece of data that is provided to the public yet it doesn’t show who bought or sold it. There is privacy in the transactions while also allowing them to be transparent.
How will blockchain revolutionize real estate?
Real estate transactions can be easily made and protected through this technology. The world is slow to warm up to the internet, but eventually it will be too good to pass up.
As for now, blockchain will continue to shock the industry with its ability to organize and secure data. Tools like the ability to see what building is being sold and for how much will draw more and more firms to the technology.