Real estate sector: Strengthening foundations of property technology
With the rise of innovation, data democratisation and our growing understanding of how technology can give birth to new opportunities, Proptech will improve business performance and enhance the end-user experience
Digital technology is gradually changing the way we plan, build, maintain and use our social and economic infrastructure. The buzzword for the real estate sector now is property technology (Proptech) and most of the real estate players, large or small, are abreast on what advances it might bring to the sector. Proptech enables to bring the current piecemeal uses of technology into cohesive manner that will make economy more productive, improve standard of living, and our society more responsive to people’s needs and aspirations.
Therefore, with the rise of innovation, data democratisation and our growing understanding of how technology can give birth to new opportunities, Proptech will improve business performance and enhance the end-user experience. This indicated that the real estate sector is now poised for a “Proptech Boom”. While several companies are still in process of exploring enormous wave of digitisation and technology, below are some major developments that have emerged as of now:
Race to leverage data will intensify
The real estate industry will continue to leverage data with the help of Internet of Things (IoT). With an objective to provide products that drive benefits to consumers, it is vital for the industry to understand the importance of data. Therefore, to improve and personalise the user experience of the built space, it is important to harness data more strategically and tactically.
In what was earlier restricted by boundaries, Proptech now allows workplaces to get rid of these and promotes flexibility. Having been popularised recently, Proptech has made a variety of possibilities available for new-age workspaces. From adjusting room temperature and lighting, reserving desks at work to even ordering food and beverages from their preferred restaurants, all this can be easily done through an app. And this is not all. This data can be leveraged further in areas such as facilities management. Since, Proptech can be used in official purposes, the data gathered can be used to understand office usage patterns. This leads to better efficiencies in space. They can map out peak periods of space usage and shut down power and water supply when the space is not in use, or place unused zones in a low-power mode to maximise energy savings. Or they may dynamically make this space available to other enterprises to use in real time.
We are increasingly witnessing government investment in smart building technology as well. With increased automation, facilities management service providers can consolidate network operations to manage a portfolio of buildings remotely at a lower-cost location, relying on automated sensors, supervised by a lean pool of highly skilled facility managers.
Such models of building management stimulate the economy as they are in line with the government’s plan to create high-value jobs. Through virtual centers, a single facility manager can manage a portfolio of buildings without relying on low-skilled workers. These virtual centres or network operation centres are a product of automation of building management.
Such synchronisation of data results in better utilisation of under-used spaces. This makes it possible to imagine a scenario where landlords can rent out co-working space and manage their resources efficiently.
Cybersecurity in sharper focus
Apart from the growing trend of smart infrastructure, another important aspect of proptech is the focus on cyber defence and cyber security as the rise of the implementation of smart-building technology and various user app to interact with built environment can lead to an increased infusion of access point hackers of such buildings in an economy.
Technology supporting smart buildings will increasingly have to take into account multiple scenarios and building owners will have make investments to safeguard their buildings and the assets of those who occupy them. The focus on cybersecurity in buildings will only intensify in the future.
Automation of smaller deal sizes
It is not easy to guess that fintech advancements will progress to real estate as well. It helps match retail investors with developers or institutional property funds. Fintech also helps create algorithms, automating the match between investors and available assets, especially those priced in the smaller sub-million-dollar market.
Like all other fields, this also come with few challenges which include limitations in access to top talent who have the ability to understand and reimagine digital real estate. We need to effectively capture and harness data which will intelligently leverage data, to drive remarkable outcomes. But, these challenges are just a part of the transformational journey, just like in any other sector and the benefits balance out to be far larger.