Close

Cart

Total $0.00

Checkout

From buildings filled with sensors tracking employees, to software that monitors reams of leasing documents, new technologies are rapidly being incorporated across the commercial real estate industry.

While no two tools are the same, they share a common output: data.

Big data, and the technology driving it, are promising huge leaps forward for the real estate industry. While broad-based data collection requires requisite caution, the eventual outcome is likely to be greater transparency, especially in markets where information remains tightly held, according to JLL and LaSalle’s Global Transparency Index.

“Property is in the midst of a technological leap,” says Jeremy Kelly, global research director at JLL. “The adoption of new technology platforms generates new and more easily-accessible market data, which is key for overall real estate transparency.”

In recent years, progress in improving transparency has failed to keep pace with growing demands from investors and the public. “We’ve gotten used to using technology to track everything from our health to our relationships, and this has raised the bar in terms of what we expect from real estate technology,” says Daniel Mahoney, vice-president, research and strategy, at LaSalle Investment Management.

But significant change is on the horizon. In the last two years, US$6 billion has been raised by so-called proptech start-ups – companies developing technologies dedicated to the property industry. More than 250 start-ups are developing and rolling out proptech around the world.

Take Israeli start-up Skyline AI. The company claims to have the most comprehensive dataset – including stock-market performance, interest rates and financial indicators, commercial real estate analytics, city and district level data – drawing on more than 130 sources going back 50 years. This allows the platform to make algorithm-based predictions around real estate asset performance, pricing, rents, effects of renovation and broader market trends.

Corrigo, a facilities management platform with more than a million users, has developed a platform that is able to predict how many cooling systems will need repairing in a particular city each summer, and to then allocate engineers appropriately to fix them.

New technology platforms and services will give investors, tenants and property managers access to more easily-manageable datasets, allowing for better-informed decision-making processes.

“As these companies mature, proptech has tremendous potential to improve transparency wherever it is adopted,” Kelly says.

Transparency through technology

Countries like the U.S., the Netherlands, and Canada, which already boast high levels of real estate transparency, have embraced proptech, the index shows.

But it’s markets such as China, Dubai, Mexico and Brazil – where data coverage by traditional operators may be less extensive – that innovations like blockchain and brokerage apps will significantly boost transparency.

“Technology is enabling these markets to leapfrog the transparency process undergone in more developed markets,” Kelly says.

Listings websites are among the most widely-adopted technology platforms, even in low-transparency markets like Egypt and Argentina. At the other end of the spectrum, blockchain technology could lead to greater global standardization in all areas relating to property, from city planning to environmental reports.

Trials have already started. Dubai plans to record all real estate transactions on blockchain by 2020. Estonia is also using the technology to authenticate property registries.

Long-term promise, short-term problems?

But the path to greater transparency has its hurdles.

Accurately monitoring real estate markets requires high-quality insights from strong data sets. However, the rapid expansion of proptech tools has provoked concern around the consistency and reliability of some of the data, a natural side effect when some of the new data providers rely on scraping online sources.

Kelly warns of unintended consequences for the industry. “Many proptech pioneers claim they have solutions to real estate data problems, but there may be compromises,” he says.

The ownership of information is also a key concern. Property owners and managers can collect vast amounts of data on tenants through sensors, internet-linked devices, and video feeds. If the information is tightly-held among operators, it could limit the broader benefits of new tools on wider market transparency.

Publicly-shared data “expands the size of the market and makes it more efficient. Proptech data certainly has this potential, but this outcome is not guaranteed unless the firms involved choose to take this path,” says Mahoney.

As real estate becomes a mainstay allocation for almost every institutional investor, access to consistent and reliable information is crucial.

“Improvements continue to be mad but investors and corporate occupiers are demanding ever higher levels of disclosure,” Kelly says. “And proptech firms are promising to accelerate progress.”

Download Now

About Real Views

Real value in a changing world

Real Views is a news site from JLL that features stories exploring the world of real estate and its impact on the wider business world. Our authors and contributors, from within and outside of JLL, provide expert insights that create stimulating conversations to help you make informed decisions.

Related News

Can Artificial Intelligence Replace Human Intelligence in Hospitality Revenue Management?

Apple Core Hotels, Inc. Selects Cendyn to Power CRM Across Hotel Group

How Many Tourists Is Too Many?

New SiteMinder Study Reveals Economic Turmoil Is Not Holding Latin Americans Back From Traveling

Shiji Group Opens New Office in Washington D.C. Metropolitan Area to Continue Expansion in the Americas

YOTEL Makes INTELITY a Brand Standard

Hapi Announces Availability of “Hapi Connect” on Salesforce AppExchange, the World's Leading Enterprise Cloud Marketplace

The Queens Hotel in Canada Sees 20% Growth in Revenue With Hotelogix

TPI Hospitality Leverages ProfitSword Integration to Maximize Business Intelligence Transparency and Efficiency Across Organization

Hotel Data Management: Build an Integrated Journey

Newmark Hotels Joins With Pegasus/Travel Tripper for Comprehensive CRS Solutions

Hotel Booking Engine Launched by Bedvine

StayNTouch CEO and Director of Strategic Partnerships Talk Platform Power

Azalea Hotels & Residences in the Philippines Sees a 30% Increase in Its Revenue With Hotelogix

RCD Hotels Taps Duetto to Drive All-Inclusive Technology Innovation

Opportunity for Hotels Is Big: SiteMinder Report Finds Travel to Germany Is Outpacing EU's Top Destinations

Cloud5 Communications Upgrades Internet to GPNS Standards at the Key West Marriott Beachside Hotel

How France’s Hotels Are Rethinking Style and Space

Hospitality M&A Focus to Shift to Smaller, Niche Platforms in 2019

Cendyn Launches the All-New ePlanner Platform

All News »

Please login or register to post a comment.