The volume of PropTech financing globally has been rising steadily, increasing 36% each year (CB Insights).
Property Technology: the future of real estate. From funding to data analysis to record keeping, technological platforms are changing the face of real estate. Feeling out of the loop? Check out these three articles for an update on the PropTech people were talking about this week and what it means for our industry.
What it’s about: Blockchain technology allows for a level of transparency that is unparalleled by any method of due diligence used in the real estate industry today. Aspects like fraud-proof record keeping and a frictionless closing process make this technology appealing to those begging for higher efficiency in the title process. However, while blockchain can be used by title insurance agencies as a tool, the full integration of this new technology is a long way off, and even then, the human aspect of title will always be needed.
Why it matters: While brokers, attorneys, and title agents often sweat at the mention of blockchain, wondering if this complicated technology of the future is going to make their jobs obsolete, blockchain should be looked at as a platform that will improve efficiency in ways that will make jobs easier, not replaced. Even though it is likely that many of the current functions of title will be handled by blockchain in the future, the need for title insurance agencies will still exist. With the rapid pace of technological innovation our world is facing, all jobs are changing; continuously learning about and adapting to the changes specific to our fields is how to stay competitive.
What it’s about: Investors have realized the profitability of property technology and venture capital is quickly entering the market. MetaProp is a venture capital fund doing just that, and it recently raised money from the reputable firms Prudential and CBRE. These firms clearly see magnitude of the potential uses property technology can have. MetaProp is aiming to fund approximately 40 startups with early funding of between $150,000 and $2,000,000.
Why it matters: Venture capital firms are cognizant of the benefits advances in property technology will have on the real estate industry. The need to keep your business current and understand the disruptors in the industry will lead to a more successful business. Startups often have a big picture attitude that is lost in the repetitious workstyle of more established firms.
What it’s about: New York is leading the market in property technology, which prompted French real estate development firm Vinci Immobilier to seek knowledge on relevant advancements. The French market for property technology is far smaller than that of New York City, and so is the abundance of co-work spaces and smart city technologies. Visiting New York will give the French firm a renewed sense of innovation and hopefully propel it to apply and create new real estate technology.
Why it matters: New York is emerging as the global leader of PropTech— and other countries are taking notes. With a commercial real estate market unlike any other, it’s unsurprising that some of the greatest property innovation, an industry in which approximately US $6 billion in venture capital has been invested globally since 2011, is based in New York City.