The growth of PropTech and its impact on the commercial real estate industry
What is proptech?
PropTech, otherwise known as property technology, is the application of technology to the real estate industry. This technology is also often referred to as CRE Tech, Real Estate Tech or Real Tech.
These technologies are designed to improve the efficiency of commercial real estate operations, such as customer service, deal sourcing, property management and transactions processing.
What are the uses and benefits of PropTech?
PropTech offers a range of opportunities for the commercial real estate sector, from streamlining processes to generating valuable insight based on analysis of Big Data.
Improved data analysis and decision-making capabilities
Leveraging analytics is one of the most powerful benefits for the industry. PropTech can be utilized to analyze complex data from a variety of sources to provide valuable insights into commercial real estate operations. They can help pick-up and predict tenant trends, market conditions and business opportunities.
Tasks that would usually require weeks of research, could potentially be done within minutes. For example, there are technologies, such as MapYourProperty, that aid developers in determining where to locate their new projects. Software such as this could pull all the information the developer needs, such as zoning laws, transit corridors and land use, to generate locations that most suit requirements of a project.
More efficient leasing process
A key benefit of improved data-analysis capabilities is that it can be a great resource in helping business owners to make better decisions about utilizing their resources and optimizing processes for greater efficiency.
The technology could also be used to streamline communications and collaboration between different stakeholders, including the landlord, tenant and tenant’s representative aiding them in negotiations. For example, by automatically routing completed forms and contracts to all stakeholders simultaneously. Such automation accelerates processing of documents and ensures all parties are notified of any developments in the process.
Building management systems and smart technologies
To ensure efficiency in management of buildings, for example, optimization of space in relation to footfall in given times of day and week to insights on building performance in terms of sustainability and energy use. PropTech systems can use real-time data and insights on building performance to help property managers make data-driven decisions to improve efficiency of operations.
Smart tech can be utilized to enhance the tenant’s experience, with systems such as smart locks, security cameras and smart lighting and heating. Tenants can also use technology to schedule maintenance and handle property related issues.
Improved property tours
Virtual and augmented reality tools can assist tenant representatives, tenants and property managers save time by completing the initial viewing in virtual reality. This gives the tenants the opportunity to take an initial look, before deciding if they want to dedicate more time to view the property in person.
The tool can also be used in situations where the property has not been fully fitted out to demonstrate what a finished office would look like, giving tenants a better sense of the potential of the property and how it can meet the needs of their business.
Finally, for property managers virtual reality tools can also be used as a marketing prop for their building, helping to reach more potential tenants and do it efficiently.
Increased accessibility and transparency in the real estate market
The increased accessibility can be achieved thanks to real-time data. By using analytics the platforms can provide real-time data on market trends, available properties and pricing, which can help tenants and their representatives make informed decisions, faster.
By offering a centralized database of property data, PropTech can also reduce the possibility of fraudulent activities and make the process of leasing a property more transparent. In the past, these transactions were conducted offline, which made it difficult for all stakeholders to get accurate information about properties.
PropTech: a promising future for commercial real estate
Technology has seeped its way in multiple aspects of our lives, so it’s no surprise that it will also have a big impact on the commercial real estate industry. The pandemic has already accelerated some uses of PropTech, such as the adoption of virtual reality for office viewings and site visits.
As new technologies advance the property industry, savvy industry professionals will use those tools to stay ahead of the curve, utilizing these technologies to optimize their operations, improve marketing and customer service and make better business decisions that are backed by data.