Real estate firms have begun to realize the benefits of a diversified portfolio as they focus on roles far different than the ones they're used to. According to JLL's The Investor, there are those who have focused on studying how technology can be made to bolster their business as challenges to the industry are being overcome through the proper use of tech.
Another analysis by Digiday UK tells of a different set of assets being looked at by traditional real estate agencies. Office supplies retailers like Staples are looking at being branded as just 'office supplies retailers' to becoming 'co-working and business service' franchises. This is evident when Staples re-envisioned itself as 'the Worklife Fulfillment Company.'
Last year, around US$9.6 billion in venture capital was raised for prop tech. The amount was down from a measurement done in 2017, where the protect fund was valued at around US$12.6 billion. This figure, however, was modified with Softbank's US$4 billion investment in WeWork, a co-working operator.
The technology revolution is real. Real estate companies have already invested in at least a type of property technology firm. From a survey done by Altus group, more than two-fifths of those agencies are already using some form of technology. Most of them have been invested in using automation for processes like benchmarking and performance analysis in different sectors of their businesses.
Real estate agencies have accounted for 13 percent of the world's GDP, but the productivity growth in this sector has always been poor when compared to other industries. Dr. Bing Wang, an associate professor at Harvard University who studies business practices in real estate and the built environment, said that one area that should be studied is the lack of innovation.
That doesn't seem to be the case now, whether in asset use or enlisting the help of technology. In the case of Staples, it's going the way of WeWork--repackaging itself as a place where workers 'can feel happy and productive.' Since then, it has rolled out new private-label technologies, as well as different office products and business services still in the works.
What kind of future awaits the real estate sector with these changes abounding? One thing's for sure--the revolution in tech has always been good to the sector adopting it. It's about time for real estate to adjust to tech and the changes if it wants to survive and evolve into the future.
