Artificial intelligence is increasingly proving its transformative potential in asset management. As transaction times in real estate lengthen – recently increasing from an average of 342 to 363 days – the promise of AI to accelerate processes, uncover insights, and automate time-consuming tasks is more compelling than ever. Yet to unlock these benefits firms must prioritise smart implementation and meaningful change, not just rapid adoption.
AI adoption: Where are we now?
AI investment is robust: Surveys by the CFA Institute, BNY Mellon, and EY have found that 70–80% of asset managers are investing in AI, but typically only a quarter rate their capabilities as mature or feel very confident in their use of AI. Why the disconnect? Experience shows that while AI excels at specific tasks like document review or due diligence, widespread, confident integration is held back by cultural and operational challenges, not just technological ones.
Unlocking value: The practical impact of AI
- Automating the mundane: AI is currently most effective when automating repetitive manual work, such as sifting through documents for due diligence or compliance checks. This frees up asset managers and legal advisors to focus on analysis, negotiation, and strategy.
- Cutting time-to-close: With AI-driven platforms, information can be retrieved, organised, and analysed much faster, shaving weeks off the due diligence phase alone. In practice, platforms built around AI are reducing document review times by 50% or more.
- Cost and competitiveness: By streamlining legwork, firms have reduced legal costs and can work on more deals simultaneously. However, in some cases, AI is used more for show than for practical value – the focus must remain on measurable improvements, not hype.
Foundations matter: Data readiness is key
Despite advances, most firms are still not consistently “deal ready”. From our own experience, we see that around 60-70% of customers lack organised documentation and don’t hold information centrally. Due to this, the actual deal preparation phase takes longer, because documentation needs to be found, reviewed and updated first. The property industry struggles with managing data because recording and updating it is often undervalued as a tedious admin task. Fragmented and poorly structured data remains a stubborn pain point, with issues like:
- Data stored across multiple, disconnected systems
- Lack of standardisation and clear governance
- Insufficient transparency about what documentation is available (or missing)
Without these foundations, AI alone cannot deliver magic solutions – data must be structured and centralised from the outset. No matter how powerful an AI tool, it is only as effective as the information it works with.
AI’s role in speeding up dealmaking and beyond
While AI is not a cure-all solution, it can significantly accelerate certain high-effort processes. For example:
- AI-assisted document summarisation can speed due diligence by up to 50%, although current tools don’t achieve 100% accuracy yet and require human oversight to verify outputs. Verification can only happen if the AI-tool shares its sources.
- AI helps reduce legal costs by compiling and structuring information for lawyers to review more efficiently.
- Pipeline management and validation are key areas where AI can progressively boost productivity.
That said, AI hallucination (where AI generates inaccurate or fabricated content) remains a concern, emphasising the continued need for human checking and accountability in workflows. Validation, context, and ethical judgment remain core human strengths. Technology will not replace dealmakers; rather, it will empower them to focus on relationship-building and strategy.
Transparency is also vital, not just for internal users, but for clients and regulators as well. Asset managers need to know how decisions were made, what data was used, and where any limitations or risks lie.
Overcoming barriers: Trust, awareness, and change management
Many in the real estate sector have yet to fully adopt AI, citing reasons such as:
- Lack of awareness about available AI tools.
- Limited internal structures and processes to support AI implementation.
- Distrust in AI platforms, especially consumer-facing ones like ChatGPT, compared to enterprise-grade solutions.
- Lengthy IT approval processes restricting rapid technology adoption.
Risk management through thorough tool evaluation, including legal compliance assessments, understanding where data is stored, and completing due diligence questionnaires before adoption are important best practices.
Getting started: Recommendations for asset managers
To fully leverage the benefits of AI, firms should focus on these principles:
- Centralise and standardise data: Build a “single source of truth” with structured, up-to-date documentation.
- Invest in data governance: Strong management practices underpin every successful AI application.
- Prioritise transparency: Use platforms that support audit trails and clear reporting.
- Set practical goals: Deploy AI where it delivers tangible improvements, such as reducing due diligence times or streamlining document reviews.
- Champion human oversight: Keep people involved to review, validate, and explain outputs – building trust and confidence. Use platforms that share sources for generated input.
- Ensure data protection: Only use platforms that have a proven track-record of advanced security measures and are built to protect confidential information.
- Deploy dedicated data experts: Hiring a dedicated data manager can significantly improve outcomes.
Conclusion: Incremental innovation builds long-term value
AI offers asset management an evolutionary path toward enhanced efficiency, better capital raising, and faster, more reliable dealmaking. The journey demands incremental progress grounded in solid data infrastructure, human oversight, and cross-industry collaboration.
The companies achieving the most value will be those blending thoughtful AI integration with strong data governance and clear accountability – taking deliberate steps to “walk before they run”. At Drooms, we remain committed to supporting asset managers through this journey by providing a secure, user-friendly digital platform designed to future-proof dealmaking and asset management workflows.
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