For most companies, reaching Level 6 in AI proficiency (
see last week's blog) may not be, or should not be, the ultimate goal. At this stage, AI oversees processes and makes decisions based on the information it collects. The critical differentiator here is the ability to make decisions. In the real estate development world, some decisions are black-and-white, but we make decisions every day that fall on a spectrum of gray. Accounting, on the other hand, is ideally suited for Level 6, where decisions are binary answers: yes or no. A sequence of thousands of binary decisions is ripe for being disrupted by AI. However, navigating thousands of "
maybes" or "
kinda" responses does not yield effective AI solutions, and we encounter many such scenarios in real estate.
DXD leverages AI to analyze data, enabling us to make more informed decisions. It handles the repetitive tasks that previously required a human—someone who didn’t necessarily need extensive experience but could manage data entry and analysis. For example, a tool to search all available land listings, identify the most profitable opportunities and feasible development sites, conduct preliminary due diligence, that can draft and send an LOI. At the moment, I cannot get my arms around this challenge because there are many intangible factors to consider. Such as understanding the seller’s position based on the broker's feedback. Does the seller seem eager to close quickly? Have others had the property under contract but then backed out? These insights significantly influence how much we’d be willing to offer for the land. This ties into the importance of relationships and reputation in our business. If there’s one thing that’s crucial in real estate investing, it’s relationships. And AI is more likely to harm these connections than strengthen them.
Five to ten years ago, coding was considered the most essential skill in tech. However, AI has transformed the landscape. Why learn to code when tools like Claude can do it for you? This shift is unlocking countless opportunities for businesses to create tools that were once deemed too complex or challenging.
Take an example from our own experience: we’ve been using a software solution that’s become an industry standard for tracking deal progress and managing all the intricate details. It serves as a single source for consolidating deal information. This SaaS (Software as a Service) product, once regarded as untouchable, comes with a hefty price tag comparable to a brand-new luxury car. While it’s undeniably valuable, we’ve realized we can rebuild it, improve it, and customize it to perfectly suit our needs for a fraction of the cost—just 1/20th.
The best part? We own it.
It’s not just about saving money; the true value lies in making it work for us. We can train it to understand our priorities, what matters most, and what to watch out for. This would never have been possible with an off-the-shelf SaaS solution.
Along these lines, we built a centralized “warehouse” for all our data: past, present, and future. And this warehouse data is updated in real time. You can ask it anything: What was the occupancy at Extra Space Kihei in Maui in September 2025? Within seconds, you’ll have an answer. Summarize the earnest money deposit structure for our last 10 LOIs. Seconds later, the information is at your fingertips.
This system continuously improves with more data, better instructions, and additional reference points. All securely contained within our organization, safe from data leaks. This is Level 4 AI: a specialized, in-house tool designed to address specific challenges. Companies that embrace this approach long enough naturally evolve to Level 6, where the mindset shifts to AI-first. Instead of asking, “How do we solve this problem?” they ask, “What can we build with AI to solve it?”
In our business, when faced with similar challenges in the past, the solution was to hire more help. That’s no longer the case. There’s no doubt we’re already seeing clear examples of AI replacing human roles.
It’s happening today.
Drew Dolan
October 18, 2025
