OUTLOOK
POST-PANDEMIC ADOPTION
The on-going coronavirus pandemic has accelerated the development and application of proptech. While social distancing may affect onsite sales, further deployment of VR / AR showrooms and increased application of big data and artificial intelligence into marketing and sales processes have helped real estate marketers to continue sales operations. Preventive health measures against the pandemic have further encouraged smart applications at the workplace and home. We believe proptech applications will be broadened and embedded in real estate industry practice in a post-pandemic world.
“ We believe asset or property management will become the area that drives the next generation of proptech development and investment, as the advances of big data, IoT and artificial intelligence support further proptech development.”
Currently, the development of proptech has been focusing on the following areas:
• Marketing and sales – For real estate marketing, we have already seen the impact of the advances in VR / AR on promoting real estate sales. With advances in big data, cloud computing and artificial intelligence, the real estate industry has further adopted more robust customer relationship management( CRM) applications to its marketing and sales operations. The adoption of more powerful CRM applications allowed better identification of sales opportunities, customer acquisition and expectation management, as well as project management.
• Property transactions – Property transaction has always been a complex process due to information asymmetry and involvement of multiple parties with diverse interests. While the first generation of proptech has gained ground in aggregation, marketplace and direct-listings, further development in the area of property transactions has been limited. With advances in blockchain technology, the use of blockchain to build an open system for property transaction ledgers and exchanges of property become more prevalent. However, the challenge of utilising blockchain technology for property exchanges has always been regulatory, especially in bridging the technological advances with oversight from authorities.
• Property management / asset management – One area of proptech application that has gained traction within the real estate market has been asset management, which includes lease management, tenant management, smart home and smart workspace, digitalisation of property management, asset maintenance and asset enhancement. From the perspective of landlords, these tasks of asset management are tedious and costly in terms of money spent, as well as time and efforts involved. However, they are necessary in keeping and adding value to an asset. Thus, the development of proptech has given the landlords opportunity to deploy more efficient property management solutions. The advances in cloud computing and Internet of Things( IoT) technologies have allowed increased digitalisation and automation in lease management, space utilisation management, day-to-day operations and maintenance, which do not only accelerate the development of platform sharing operations( e. g. co-working space and co-living space) but also help investors / landlords with multiple assets to gain economies of scale in property management. Another proptech application to property management in selected countries is the solar energy system: starting as a cost-saving tool, it has also become a new source of revenue.
NEXTGEN TECH TO DRIVE ASSET MANAGEMENT
In a post-coronavirus pandemic world, we believe proptech to be further entrenched in the different segments of the real estate industry, as the pandemic also pushes the real estate industry players to improve cost efficiency and to deploy technology to satisfy customer needs. Notably, we believe asset or property management will become the area that drives the next generation of proptech development and investment, as the advances of big data, IoT and artificial intelligence support further proptech development. Asset management / property management has also been less penetrated by technology, which means the potential for cost-savings and efficiency gains by deploying proptech is substantial.
ABOUT THE AUTHOR
Patrick Ma, CFA has served as Admiral’ s Research Director since 2016 and subsequently Admiral’ s Director, Listed Products and Research. Patrick is responsible for the investment research that backs all of Admiral’ s investment advices and management activities. He is also responsible for Admiral’ s products in the listed space. Patrick has over 20 years of experience in the securities markets.
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