Brandon Dey, Co-Founder, October 4th, 2024

Retail CRE is stuck in the past while rapidly flying blind into the future. The reason is twofold: an over-reliance on institutional tactics of risk management (“retail fundamentals”) and an old school oligarchy: the broker model. Brokers have long misidentified their biggest weakness—relationships—as their strongest asset, relying on personal connections, basic demographics, and brand recognition to select tenants, set rents, and control deals.

This reliance on who they know—not what they know—leaves retailers and landlords vulnerable to mispriced risks, frequent lease defaults, and long vacancies, causing cyclic seesawing and financial volatility. The tyranny of relationships and institutional rules of thumb are holding us back. And the cracks are beginning to widen:

• 30-40% of leases fail to renew, showing poor tenant selection and unmet demand.
• 5% of leases default, creating instability and unmet demand
• Leasing takes 9 months despite excess inventory
• Expanding national retailers face delays while locals pay unjustifiably high rents, averaging 6-8% growth annually
• Bankruptcy among national retailers isn’t substantially better than independents
• Deal flow relies on overwrought criteria, driving up costs

Without intervention, these inefficiencies will fester and keep retailers and landlords at the mercy of speculative deal making.

AiCRE’s mission is to make CRE antifragile by transitioning from broker guesswork and fraternity-style thinking to machine intelligence and scientific thinking to better predict, price, and control risk. We’re doing this by creating a vertically integrated system designed to sense, anticipate, and respond to local market risks at national scale. Our system includes three key layers:

• Foundation: A Decision OS that tracks, predicts, and prices risk
• ARM: An insurance layer that absorbs and redistributes financial shocks
• Controls: Autonomous tools to optimize market value

Together, these layers work together to replace the outdated boom-and-bust cycle with a self-reinforcing ecosystem of next generation tools and information for risk management and value optimization.

The plan is simple:

1. Own the data layer by attracting the market with freemium-to-premium tools
2. Use that data and money to build insurance/hedge products
3. Use that data and money to build autonomous decision tools
4. Scale and monopolize CRE