Proptech – The Future of Real Estate
'-tech', a suffix that denotes the most phenomenal phase of transformation that the world has ever seen. The emergence of fintech, regtech, suptech, among others, is completely changing the way we live and do business. Digital transformation is the new order, and every industry is either being disrupted or on the verge of disruption. The real estate sector, however, has been slow when it comes to tech adoption. Despite representing the world's biggest and most valuable asset class, the property sector has always been considered a late adopter of technology, but things are changing fast, and proptech is emerging as one of the hottest trends in real estate.
As consumers become more and more technology-dependent, and businesses look for new ways to increase efficiency while reducing costs, real estate players around the world are turning towards technology as solutions. A recent study by a global bank indicated that proptech is shaping customers behaviour when it comes to dealing in property. According to the survey, 72 per cent of UAE property buyers search for property online, 67 per cent use online tools to check their property value, 65 per cent search for information on taxes and regulations online, and 64 per cent use internet tools for prospective home prices. While online listings portals have been around for a while, today, real estate developers can transform every aspect of their business with the right technology integration. Let's look at some of the ways in which technologies, both existing and emerging, are reshaping the industry.
Big Data and CRM
The real estate industry has always been a treasure trove of big data. However, the data is often scattered and unstructured. By organising this data and employing the right analytics tools, real estate developers can conduct better financial analysis, take better investment decisions, predict market conditions, and serve customers better. At DAMAC Properties, we have migrated all our customer data to Salesforce, an integrated CRM platform that gives all our departments a single view of the customer. The digitisation of data has enabled us to create Hello DAMAC, a one-stop customer services portal that allows customers to access essential property services 24 x 7.
Speaking about DAMAC’s digital transformation initiatives, Ali Sajwani, General Manager of Operations, DAMAC Properties, said, “For any organisation, digital transformation is a long and ongoing process. However, what’s most important is to get started with a long-term vision in mind. At DAMAC, we have started our journey by adopting technologies that help us engage with our customers better. As an innovative and agile organisation, we are always looking at new ways to improve our processes on all fronts.”
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Artificial Intelligence is perhaps one of the most influential forces in the technology revolution that's transforming the world. From voice recognition to autonomous decision making, AI's implications on the real estate sector are genuinely incredible. Through AI and predictive analytics, developers can get access to never-before-seen insights into the market. We can improve the efficiency of operational processes and completely transform the way we make decisions. We can build better, improve the energy efficiency of our projects, and understand the present and future needs of our customers better.
Robotics and Drones
Robotics is changing the way we construct buildings, bringing more efficiency and cost-effectiveness in construction. However, their significance is not just limited to construction or facilities management. Robotic process automation, for instance, the implementation of virtual agents can be immensely helpful in automating repetitive back-office processes such as invoicing, NAV calculations, and documentation, among others. While drones have long been used for site surveillance, we could soon see drones being used for tasks such as property management, inspection and maintenance.
So far, 3D printing has been used extensively to create scale models for real estate projects. Prototypes of 3D printed homes have been created in various parts of the world. The technology could soon become more mainstream and transform the way real estate built. 3-D printing of entire buildings or parts of architecture will have a significant impact on reducing the time involved in construction.
Virtual Reality and Augmented Reality
Virtual reality has already been successful in marketing real estate. By giving potential customers a virtual tour of off-plan projects, we help them make better decisions. However, the scope of VR in real estate transcends marketing. By integrating VR in planning and construction, developers can take better decisions and improve operational processes. Earlier this year, DAMAC Properties introduced VR to train construction workers on safety procedures. Augmented reality can also be used to show customers and other stakeholders what an under-construction property will look like once completed.
Blockchain will transform various aspects of the real estate industry. The transparency and security associated with blockchain could expedite pre-lease due diligence, improve contract management, and enable more efficient processing of financing and payments. Blockchain also allows real estate tokenisation, the process of representing an ownership interest in real estate with a token. In Dubai, the government is leading the adoption of blockchain in the real estate sector. In 2017, the Dubai Land Department launched its blockchain platform that uses a smart and secure database to record real estate contracts such as lease and registrations and linking them to telecom and utility accounts.
While 'tech' implies technology, a tech transformation is not just about adopting or acquiring technology. For real estate developers to become digitally fit, they need to bring about a culture of innovation at every level. Proptech can undoubtedly transform the future of our industry. However, we need to adopt a mentality that compliments technology.