Generative AI is set to revolutionize the property sector, and property leaders need to prepare for this AI-driven future. Yardi’s latest thought leadership paper, Fuelling the AI Future, highlights the staggering growth and potential of generative AI.
According to Yardi, by the end of 2028, an estimated six billion users, representing around 90% of the global smartphone market, will be using generative AI. One of the most prominent generative AI tools, ChatGPT, achieved an impressive milestone of reaching 100 million users in just two months. To put that into perspective, TikTok achieved the same feat in nine months, the worldwide web in seven years, and the telephone took 75 years.
While artificial intelligence itself is not new, generative AI is a game-changer. Unlike traditional AI that makes decisions based on existing data, generative AI creates new data. This immense demand for data is fueling the need for data centers.
Analysts predict that by 2028, the generative AI data center server infrastructure, along with operating costs, will surpass $76 billion. This is more than double the annual operating cost of Amazon’s cloud services, which currently holds one-third of the world’s cloud infrastructure.
However, the availability of land for data centers is becoming a challenge in many capital cities. Additionally, energy efficiency is a pressing concern as data centers are responsible for approximately 1% of global energy-related greenhouse gas emissions. The exponential growth of generative AI will inevitably lead to increased energy consumption.
Fortunately, advances in IT hardware and innovations like immersion cooling have contributed to improved energy efficiency. Many large-scale data center operators are also embracing renewable energy to offset their emissions. However, as generative AI workloads and models become more complex, data center operations become more challenging to manage effectively.
Streamlining operations is crucial for maximizing revenues and improving return on investment for data center operators. This includes efficiently managing leasing, billing, procurement, maintenance, work orders, and vendors.
While generative AI offers numerous rewards, it also carries risks. Ethical use of AI is a concern raised by organizations worldwide, including Yardi. Intellectual property infringement, identity theft, social engineering, and security threats are just a few of the challenges that need to be addressed.
Nevertheless, generative AI offers immense power and potential in the property sector. Yardi’s Rentcafe, for instance, incorporates a chatbot to assist prospective build-to-rent customers. Yardi Payscan utilizes AI to facilitate a paperless invoice process.
Looking ahead, it is evident that the property sector must navigate this AI-powered future carefully. Although challenges abound, the power of generative AI cannot be ignored. It is time for the property sector to embrace this new space race and pilot a new course into the future. By doing so, property leaders can unlock the full potential of generative AI while ensuring its ethical and responsible use.
