Article
Get onboard the proptech wave
Why property organisations need to play defence and offence with their digital transformation strategy
Like many other industries, the property sector is ripe for transformation through the use of digital innovative technology, to the extent that the technology explosion in the sector has its own portmanteau – ‘proptech’, to cover the wave of advancements that have disrupted the sector.
Artificial intelligence (AI), big data analysis, data visualisation, virtual and augmented reality tools, blockchain, 3D printing and the Internet of Things (IoT) are all increasingly integral parts of the property industry. Not only are buildings being developed with smart design, smart construction and smart systems front of mind, the buildings themselves are ‘smart’ – and able to provide constant outputs about things like their own health, operational status and usage patterns.
Buildings are generating terabytes of detailed insights, that are creating new avenues of opportunity for property owners and managers to be much more proactive in anticipating and delivering the levels of service that their tenants and stakeholders demand.
Property owners and managers can gain “a level of actionable insight that they’ve never had before,” says Brian Devlin, Industry General Manager at TechnologyOne – but there is a flipside to that.
“If they don’t have a solid ‘digital core’, with their data centrally available and accessible via a mobile-enabled, ‘intelligent’ enterprise-wide system, they are likely to fall behind."
“Capturing the right data, analysing it, interrogating it and acting on the insights gained, so that you’re making intelligent and informed decisions, allows owners and managers to be much more proactive than ever before,” he says.
Using a sporting analogy, Devlin says an intelligent enterprise system not only allows the property owner or manager to “play defence” – as in to optimise the usage of the utilities, the lighting, the HVAC (heating, ventilation and air-conditioning) and the lifts, to lower their own and their tenants’ costs – it also gives the opportunity to “play offence”.
“That’s the next frontier, of intelligently using the information you’ve gathered to make informed decisions, improve your service levels, apply human-centred design and proactively invest when needed. You’re no longer just monitoring for problems, you’re using your data to inform your investment strategies in your core asset over 10, 20, 30-year time frames. Getting that long-term asset management plan right really drives your ‘offence,’ and an intelligent enterprise system can help with that,” says Devlin.
Gabrielle McMillan, CEO of property technology company Equiem, agrees that technology’s biggest contribution to the commercial property industry in recent times has been to drive greater efficiencies in cost. But the second part of that contribution is to “promote a more consumer-focused approach to commercial real estate”.
As people’s workplace expectations rise, she says, owners and managers have to deliver the type of workplace that occupiers are looking for – and they have to leverage technology and data to do that. Equiem sprang from technology implemented at Rialto, a 60,000-square-metre twin office tower in the Melbourne CBD.
“Back in 2011, the owners were facing significant vacancy risk, with their 25-year-old, 1 million square-foot office tower struggling to retain and attract quality tenants in a highly competitive market. They saw the potential for a technology solution to transform their product and enrich the lives of those working in the building by delivering services and amenities, streamlining communication and creating a community that people wanted to be part of.”
Data analytics is an “absolutely vital tool” for landlords and building managers when it comes to providing a tailored, satisfying workplace, McMillan says.
“Analysing how users are interacting with your building allows owners to better understand occupier preferences and adapt their tenant engagement strategy accordingly. Being able to measure the success of a particular space, service or event, means that owners can amend their offer to better suit the needs and tastes of their occupiers, rather than simply guessing, ultimately allowing them to create both a more cost-effective and satisfying environment.
”McMillan’s argument reinforces the importance of property businesses having the most current and accurate information available to them.
A sophisticated and contemporary enterprise solution will arm property executives with the insights they need not just to deliver projects but to better understand the changing needs of their customers. This means they can more confidentially develop strategies that are attuned to longer term trends in the property sector.
“All areas of the commercial property market face disruption though the pace of change differs across different sub-categories."
Retail clients have been the most affected due to the rise of ecommerce with companies like Amazon offering the most stark competitive challenge.
In the office space market, companies like WeWork have tapped into a desire for businesses to lessen their floor space to accommodate more flexible arrangements. While in the hospitality sector, AirBnb recognised the opportunity to open up new non traditional inventory to compete with incumbent providers.
All of these disruptors share a common characteristic. They all know the criticality of understanding customers and responding to their needs, and are all sophisticated consumers of data.
To operate in such competitive times, all property companies need systems which provide them with as good an understanding of the market and their customers as possible.
Discover More:
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