PROPTECH IS HERE TO STAY
The panelists agreed that 2020 served as a significant turning point in the development of PropTech: over the course of the past year, landlords saw a dramatic and sudden uptick in demand for virtual and contactless tours, electronic signing of documents, and remote payments.
The panelists also noted that as a result of the success and efficiency of interactions via the virtual world in 2020, stakeholders have come to realize that PropTech is more than a band-aid solution — in fact, it was noted that brick-and-mortar leasing and sales offices may disappear altogether — replaced by “virtual” storefronts accessible via the internet.
PROPTECH CAN ENHANCE THE TENANT EXPERIENCE
The panelists touched on the notion that there is a common misconception that technology masks personal interactions in business. In real estate, the opposite has proven true: landlords have strategically deployed PropTech to deliver personalized and bespoke experiences to their tenants – for example, tenant interaction software (which is customarily white-labeled with the landlord’s brand and available via the iOS and Google application stores) places payment options, maintenance requests, and avenues for feedback at the fingertips of tenants. The communication and transparency enabled by PropTech, coupled with smart building technologies that allow tenants to lock their door, adjust their thermostat, and turn off lights remotely via their mobile phones, contribute to a modern luxury experience that today’s tenants have grown accustomed to and will expect long after the pandemic is no longer front and center.
PropTech enables savvy landlords to offer such a full-service white glove experience without the significant upfront capital and labor investment required to implement traditional enterprise platforms – payment systems, virtual tours, and smart building platforms are often offered in the form of Software as a Service (SaaS) accessible via the cloud, which allows landlords to adopt PropTech rapidly. Because the process to implement SaaS solutions is generally capital light, labor efficient, and highly scalable, PropTech deployments are flexible and can be scaled up very quickly to keep up with a landlord’s growing business and portfolio.
CONCLUSION: PROPTECH IS KEY TO MAINTAINING A COMPETITIVE ADVANTAGE IN 2021 AND BEYOND
PropTech, which was already on an upward trajectory, experienced exponential growth in 2020 – according to data from Pitchbook, more than $37.7 billion was invested in PropTech in 2020 (up from $14.92 billion in 2019).
Based on insight from the panelists, utilizing PropTech to do business in the real estate industry amounts to less of a sea change than a “retrofit” of the real estate industry – which has historically been heavily rooted in face-to-face interactions – adapting it to the technology augmented world we live and do business in today. While only time will tell the effect of the events of 2020 on the real estate industry over the long term, one thing is immediately certain: identifying, implementing, and leveraging strategic PropTech is key to the success of landlords in 2021 and beyond.