Having recently completed proptech investments in Unissu and Dashflow, I was interested to read Andy Saull’s article, “Proptech disruption won’t hit any time soon”, in the last issue of Property Chronicle. It introduced me to the concept of Gartner’s Hype Cycle, which at first glance seems to neatly embrace the challenges, and the reality, when it comes to the adoption of “proptech solutions” across the real estate industry.
Having been an active member of this community for over 35 years, I have seen massive change, and on the whole qualitative improvements, over this long stretch of time. But, as well as benefitting from the advances in technology, I have also seen both the hype and the disillusionment arising when so-called transformative technologies fail to deliver.
Additionally, what I find also slightly curious today, is that references to Proptech seem to suggest that this is the first time that innovation and technology has been directly pushed up against the real estate industry. But of course, many tech innovations have already run their course, following the lines of Gartner, adding material benefits to the industry: mobile phones, computers, excel spreadsheets etc! Today, I regularly hear the refrain that Proptech will both disrupt and transform my old business world of real estate fund management. As an aside, I often wonder whether the constant reference to Proptech being disruptive, acts as some kind of road block against wider trialling of many of the great ideas and concepts out there, but that’s not a topic for here.
Returning to Andy’s article, in his analysis of where various Proptech innovations are in the hype cycle, he listed many of these. From autonomous reality to light cargo delivery drones to immersive workplaces, what strikes me most about the list – with the possible exception of Blockchain – is how few of the high profile innovations seem to be aimed at the investment and ownership process, that is so crucial to landowners, developers, investors, property owners together with their respective advisory community (banks, investment agents, insurers etc).
This is an industry that relies on information and processes that can access, and utilise the underlying data speedily and accurately. Yet, I think it’s still fair to say that generally we have been poor to collect, order, and apply data that our own businesses generate, let alone obtain full access to the wider universe. Surely anything that better facilitates the full understanding of a property asset, in the widest sense, has got to be crucial in ensuring the progressive and qualitative evolution of our industry? While there are some technologies already out there in this space, with few exceptions these seem, as yet, to be only in the foothills of an ascent towards Gartner’s “Peak of Inflated Expectations”.
Yet, as I write this “hunkered down” in pandemic confinement, I cannot help but feel that this unprecedented period will act as a strong catalyst towards meaningful change. This will not just be about how people and organisations choose to use real estate, it will also materially change how real estate people work within the sector – and I don’t just mean holding team meetings via Zoom, Skype or LoopUp!
This change will be partly society-driven and Proptech will act as an enabler and facilitator. Where solutions are nascent or not quite there yet, so they will likely accelerate with the support of the industry. This may have some impact on the shape of Gartner’s Hype Cycle in relation to Proptech. Or perhaps the cycle stays the same, but innovations will run through it much faster.
When I look at property-related innovations that relate to fund management, what I’m looking for quite simply are start-up concepts that are accretive in qualitative terms to the overall industry: the ability to do things better, and faster, and to have at your fingertips all you need to know about, and operate an asset in its underlying market.