Regulations and Implications of Drone Technology

Unmanned Aerial Vehicles (commonly referred to as “drones”) are without a doubt changing the commercial real estate transaction and marketing process. The use of technology has enabled brokerages to effectively market properties by providing quality aerials, parcel layouts, and give prospective buyers a larger perspective on how a property fits within the local market. Property owners and managers can use drones to keep an eye on their properties or show vacant spaces. Even online retailers are experimenting with delivering products via drones. However, it’s equally important to understand the rules and implications of using such technology. It is tempting to rush and purchase a drone and start watching it soar through the skies, but policies have tightened over the last few years. We’ll also share how to use drones for marketing your properties, so come back to see our newest posts. Before you fly, here are four (4) major impacts to consider:

1. FAA Regulations

On June 21, 2016, FAA released new regulation which took effect on August 29, 2016 (Part 107 to the Code of Federal Regulation). An individual must obtain a remote pilot certificate by meeting several requirements including, but not limited, to passing an initial aeronautical knowledge test or hold a part 61 pilot certificate. It is also important to note that this only applies to commercial drones under 55lbs. Aircraft over 55lbs must be registered and undergo a pre-flight check to ensure Unmanned Aircraft Systems (“UAS”) is in condition for safe operation.

2. Flying Restrictions

Some properties and areas may be under a restricted No Fly Zone. Drones can operate in Class G airspace. Recreational operators are required to give notice to UAS, the airport operator and air traffic controller, of its intent to fly within 5 miles of the airport and obtain the necessary approvals. Otherwise, other notable restrictions, including around stadiums, are prohibited within one hour before or after the scheduled time of an event. If your property may fall within a restricted area, it will be important to keep such restrictions in mind or obtain the necessary approvals before flying.

3. Operational Guidelines

To operate under Part 107 of the Code, the drone must adhere to the following operational guidelines: the aircraft must be in visual line of sight; fly under 400 feet and during the day; fly below or at 100 mph and not over people; and not fly from a moving vehicle.

4. Drone Options

There are several cost options when deciding upon a drone. A multi-rotor is the easiest and usually the least costly. It is typically used for aerial photography and videography, because they have great control over position and framing. Such drones, however, only run about 20-30 minutes on a charge. A Fixed Wing is the costlier option, but it is more efficient. Such drones can run for 16 hours or possibly more with fuel. The downside is they can’t hover in one still spot, so they are not ideal for general aerial photography.

The drone industry is growing quickly with U.S. industry experts predicting the creation of 100,000+ jobs and generating more than $82 billion in economic impact over the next 10 years. There are even attorneys specializing in the drone practice field by providing business formation, compliance, and obtaining FAA waivers. For real estate brokerage firms, many are sourcing companies and individuals with the proper licensing. This may make the most economic sense in the interim where the opportunity cost of FAA regulations and licensing may not be worth it. Larger brokerage firms and real estate companies may decide, in the near future, to incorporate full-time staff and personnel. The potential is here and will continue to grow.

Regardless of the complexity of issues, safety and privacy concerns, drones will most likely continue to be a valuable resource to the commercial real estate industry.