The Beginner’s Guide to Commercial Real Estate Tech: What Exactly Is PropTech?

The real estate market is growing at a tremendous pace as industry actors and players are looking for the next disruptor. As technology continues to penetrate all sectors, it’s becoming more important for real estate professionals to stay on top to remain relevant.

In 2019 there was a lot of talk about PropTech. It’s still a new moniker PropTech is already making waves in the real estate sector. In this post, we are going to give our readers an overview of all things PropTech.

What is PropTech?

The term PropTech has plenty of definitions, the most widely accepted definition its described as technological solutions that are geared towards disrupting the real estate industry. In simpler terms, PropTech refers to companies that are changing the real estate sector to make things better prompted by new consumption patterns and evolving digital landscape.

Proptech combines multiple facets of the industry ranging from planning and construction to the sale of a property.

Proptech is very expansive; it ranges from real estate, leasing, appraisals, residential property management, commercial property management, overseas property management, the sharing economy, smart cities/buildings, construction, RegTech, and even FinTech.

In PropTech companies are embracing innovative technology to change and enhance existing ways of conducting business and address emerging problems within the industry.

The tech solutions by Proptech leverage things like

  • Big data & analytics
  • Blockchain technology
  • Artificial Intelligence
  • Robotic automation
  • Payment/transaction/lending technology
  • Digital capabilities
  • Virtual Reality

Which real estate professions is proptech going after?

The rise of PropTech is threatening several sectors within the real estate sector PropTech. Numerous startups are geared towards eliminating and replacing real estate industry professionals.

In real estate construction, most startups operate as suppliers or intermediaries for high-tech tools for developers resulting in less disruption. Due to PropTech, there are plenty of emerging new trends within the real estate sector.

The changing dynamics are forcing innovators and entrepreneurs to think about various aspects of the industry and create startups to address the emerging specific needs from the sector.

Main areas that PropTech will focus on

Some of the critical areas that PropTech focuses on in commercial real estate are:

  • Cost reduction, building/asset performance, and optimization
  • Compliance & regulatory obligations
  • Tenant information
  • Monitoring risk
  • Listing and search
  • Compliance & regulatory obligations
  • Speed and ease of processes
  • Automation
  • Customer engagement
  • User experience
  • Creating value

Factors to consider for Proptech solutions

  • Choose a solution that is adaptable and flexible
  • Asses your digital strategy
  • Determine how to use proptech such as partnering with vendors and startups, building your solutions.
  • Obtain buy-in for the solution
  • Find areas that should work together on solutions
  • Train, socialize and implement comprehensively

Why explore/choose Proptech?

PropTech provides a positive disruption in the commercial property sector. The PropTech solution will uncover, develop and monetize intersections between commercial real estate and technology using tools such as blockchain, machine learning, and virtual reality.

It will also provide solutions that will shift the industry towards efficiency and improving market transparency.