By Legal Futures Associate SearchFlow
Property law firms are on the cusp of an AI-driven digital technology transformation in 2024. Only in the last few weeks, a law firm based in London that created an ‘AI paralegal’ capable of passing part of the Solicitors Qualifying Exam (SQE) received £9.5 million of investment from Google. The challenge is when to invest and exactly what to invest in.
To understand the appetite for new technology, including AI, within the industry, SearchFlow interviewed some of the UK’s top commercial property law experts; here is what we found out.
Are firms ready to invest in technology?
The large UK and international law firms that have already invested heavily in new ‘PropTech’, including AI, will have chosen the timing and nature of those investments extremely carefully. According to our experts, the question many conveyancing firms are now asking is, “Do we invest now or later?”
They also believe that efficiencies can be gained through automation and streamlining of existing technology, for example, the use of an automated onboarding workflow and providing online dashboards to allow customers to see the latest on their cases.
Key takeaway: Many conveyancing firms are grappling with the question of when to invest in cutting-edge technology. In the meantime, it is important to maximise the efficiency benefits of existing systems and software.
How will AI affect commercial property lawyers?
AI-driven cultural shift
Jonathan Wright, Commercial Property Partner at Knights, believes that the investment by the largest firms in AI will change how the whole sector functions day to day in the next five years; “we have one of the largest commercial real estate teams in the UK, and if companies or firms like ours lead the way in adopting it, then AI will be the key to an entire culture shift”.
Automation of time-intensive tasks
Laura Ford, Senior Associate Professional Support Lawyer at Clarke Willmott LLP, foresees the adoption of AI for collating information and documents (e.g. title reports in due diligence), tasks that normally demand a considerable amount of people resources. The use of AI for resource-intensive work will allow conveyancers to make better use of their time in the view of Jonathan Wright; “I think better use of data points and analysis will also reduce the more boring aspects of our job as lawyers and let us concentrate on how we can really add value”. Indeed, the notion that AI will allow workers to move up the ‘value chain’ is a common one that is echoed in other industries.
Chris George, Real Estate Principal Associate and Innovation Specialist at Shoosmiths, also says that AI could be used by landlords to automate tasks; “It [AI] could be used by landlords to help with rent collection or managing tenant requests”.
Adding value through data analysis
Chris George also believes that AI will soon take on more complex data and trend analysis tasks, which may have enormous commercial value for property law firms; these may include, for example, identifying or evaluating commercial property investment opportunities, predicting the likelihood of lease renewals, and identifying factors contributing to tenant turnover.
Those we spoke to also emphasised that AI must be used with care. At the moment, it cannot make judgments, and it can only report the information to which it is exposed.
Key AI takeaways:
- AI is likely to prompt a culture shift in the UK’s commercial real estate sector
- It will play a key role in analysing and anticipating market changes
- Automated AI analysis may predict the likelihood of lease renewals and identify factors contributing to tenant turnover, and
- AI may also be used to spot new commercial property opportunities by analysing vast amounts of data.
What next?
For more expert insight for your law firm, please download our free guide – ‘Commercial Real Estate Insights 2024: Planning for a successful future: expert perspectives from legal professionals’.
