Proptech as an element of a sustainable growth
March 10 2020
A good development investment? Localization, localization above all. This is half of the success; the other was always interior design. Today space, not only office space, is not only a place for doing business or living. Today space is larger than life, and for designing it companies use corporate social responsibility and new technologies. Today and tomorrow belong to proptech.
Proptech or property technology is a big innovation in the world of owners and renters. The digital transformation reaches almost every industry, and it’s nothing different for large buildings, office parks, and house owners.
Digital transformation can serve two purposes:
- Elimination of humans from the process
- Allowing people to work in such an environment and giving them kind of tools that drastically increase their effectiveness and shorter time of performing tasks
Property tech supports the second option. The element of this option is constrtech, the technology of the building’s construction. Its influence reaches from the design, through usage of proper construction materials, up to the technology. All of this became an ecosystem, an industry inside the industry. It directly translates into the lives of city’s residents and workers, not only the office ones.
Proptech already has its stars. Companies like Tower 360 (integrated tools for renting, marketing or analytics), ProperGate or ShareSpace, allow assortment a proper production and operating materials, central marketing and administrative solutions for the estate manager, or finding a co-working space for companies.
It’s only the beginning. In the future, proptech will offer:
- Automation and tools for increased productivity, also for dispersed teams
- Tools for enhanced and virtual reality. They will help with resources management and diagnostics (predictive maintenance)
- Big data and machine learning will offer cost optimization; from the stage of buying materials up to water and electricity usage control
- Drones and autonomous vehicles will monitor, safeguard, and help with buildings’ repairs.
In Poland alone, there are over 100 companies building the proptech sector. They collaborate with experts and scientists to utilize the newest market knowledge to create the perfect space. New generations of employees don’t want good pay alone. With the local unemployment rate of 5%, companies race to rent offices in good localisations (opening up second or even third branch office even dozens of kilometers from the previous one). Today employees, followed by companies’ owners, expect from estate managers room for creating experiences. Free parking, means to charge electric cars and scooters, room for meeting colleagues from work for a beer or bowling. It’s another step in the awareness development – back in a day there were popping up gyms anywhere you looked, even in the tiny office buildings. All to extend the time employees spend in the office. Today there are entire business parks designed to reach one goal – identification of employees with the company. It’s still more than the Green Office Park in Tangerang (Indonesia) or green terraces in Tischnera Office in Cracow (Poland).
Modern development industry and real estate rental business today is all about:
- Buying up real estates requiring work to turn them into profitable businesses
- Development of new office parks, designed to utilize new management methods and technologies from the beginning
- Space design for artistic and business events, concerts, co-working space
- Assigned space for technological hubs that support startups
- Long-term rents based on relationships
As you can see, everything is thought-out and part of one ecosystem.
53% of American companies in this industry work for the residential sector, 38% for commercial sector, and 9% for retail. 69% of all American companies are focused on B2B, 28% work on B2C, 3% take care of both. Top cities for ReTech (as Americans called real estate technology) are New York (over 300 firms), San Francisco (over 200), and Boston (leaning towards 100).
In Europe, a leader of property technology is Great Britain (over 800 firms), France (over 500), Germany and Spain (over 300), and Netherlands (over 200), Sweden, Finland, and Switzerland (over 100). In Europe the number of companies working for residential sector is 55%, commercial is set at 41%, retail is over 3%.
The proptech market was established in 2008, heavily expanding to 2014, when ‘only’ little over 200 companies were founded. Today we are a witness to another tide, driven, among others, by increased awareness towards corporate social responsibility. Leaders discover that initiatives that are possible through created shared value (CSV), directly impacts the image and financial performance of their companies.