In today’s world, there are a lot of zero-sum games – winners and losers; those that benefit, and those that miss out.
Thankfully for those of us working in the world of PropTech (and I say thankfully because I personally prefer a situation in which everyone wins), the technology solutions coming out of this industry bring tangible benefits to all stakeholders in the real estate market – buyers, investors, developers, agents, and property managers alike.
If you fall into one (or more) of those categories, chances are there’s a PropTech service that can make your job more profitable and more productive.
Technology is increasingly impacting every stage of the real estate life cycle. Let's start with owners looking to buy. Owners are the first ones to benefit from PropTech offerings, with the introduction of investment management solutions powered by blockchain technology.
For those unfamiliar, a quick summary: at its core, a blockchain is a digitally-distributed, decentralized, public ledger that exists across a network.
In real estate, it leads to greater transparency in the purchase process, encrypted information, and faster transactions, with fewer (or no) intermediaries involved. Owners remain in charge of their own data, and the entire buying and selling process is more secure.
PropTech Solutions for Owners
What are some examples of PropTech solutions benefitting owners in the sales cycle? For starters, there are smart contracts - computerized contracts that execute the terms when certain conditions are met, facilitating trusted transactions and agreements to be carried out among disparate parties without the need for a central authority. Transactions are quick, traceable, and transparent, and are protected against fraud.
There's also tokenization, a process that divides a real estate asset into smaller units (called "digital tokens"), assigning ownership rights, increasing security, and improving liquidity. Tokenization allows individuals to purchase these smaller units and gain fractional ownership of a property, meaning more people can invest with minimum capital, lowering the barriers to market entry.
Often overlapping with owners, investors bring an added dimension of complexity to the real estate market, most evident in their focus on analyzing data to monitor risk and returns. Traditionally, investors have had to rely on laborious methodologies that involve years of market analysis and data collection – time that often resulted in opportunity losses.
PropTech is a game changer in this realm, giving investors the tools they need to keep a finger on the pulse of real estate and investment risks – collecting, analyzing, and controlling data in one place and in real time. Not only does this provide additional transparency, but it enables better decision-making, with more precise adjustments to respond to specific risk profiles and business needs.
PropTech Solutions for Investors
Investors benefit greatly from two major PropTech solutions -- investment management solutions and crowdfunding and equity platforms. Names like Allvue, SuiteSpot, Stratafolio, and Exquance are making waves in the Canadian market in the first sphere, empowering investors with the data they need to increase profitability and build more targeted relationships. In the second sphere, platforms including NexusCrowd, addy, and Fundscraper are connecting large groups of investors with high quality real estate deals to reduce risk and democratize real estate ownership.
Once a real estate asset is sold, the possibilities for PropTech don't end; the market is ripe with services and applications servicing property management companies, designed to manage assets with greater efficiency and less spending. There are platforms that help control and automate access to buildings and suites, managing visitors and deliveries; those that help optimize energy use and reduce utility costs based on weather conditions, market price, and other indicators. There are solutions for measuring equipment, outputs, and sensors, and AI that can monitor and record power consumption and voltage-level data in buildings.
There are services that can resolve maintenance issues and update financials, and others that can manage communication with tenants and residents.
In short, PropTech enables property management companies to set a new benchmark in service, to scale up or down, and to support everything from residential to commercial property assets.
PropTech Solutions for Property Managers
When seeking out a property management PropTech solution, there is truly a world of choice. Names like Buildium and Total Management offer comprehensive solutions for portfolios of every size. Others opt to target their offering to commercial properties (as with Re-leased) or residential (as with Doorloop and Entrata). Whichever you choose, you'll find technology that helps make management more – well – manageable, letting property management companies provide better service to more properties (and people) in less time.
In the end, PropTech sets up the entire real estate industry for a win-win – great news, no matter what side of the table you’re on.
Stay tuned for next week, when we’ll explore how PropTech supports developers, brokers, agents, and lenders.
This article was produced in partnership with STOREYS Custom Studio.