‘Moving to a digital business model’
The digitalisation of real estate is proceeding at an increasingly fast pace, experts agreed at Real Asset Media’s European Innovation, Proptech & Data Investment briefing, which was held at the International Investors’ Lounge at EXPO REAL last week.
‘Companies are moving to a digital business model,’ said Norman Meyer, Head of Digital Services, Drees & Sommer. ‘We have seen a big change in mindset. They are working with start-ups even if some of them will fail’.
The new mindset has also radically changed the way that proptech is being financed.
‘Now 53% of real estate companies are investing directly in proptech, which is a huge percentage,’ said Guillaume Fiastre, SVP ARGUS Product Strategy, Altus Group. ‘In Germany two out of three companies invest directly in order to accelerate the digitalisation of their business, to disintermediate and facilitate discussions among stakeholders and to have access to data’.
Access to data is key.
‘The thirst for data is increasing, as is the sophistication with which the data are being used,’ said Tom Leahy, Director of Market Analysis EMEA, Real Capital Analytics. ‘Now there are data scientists working for real estate companies, which never used to be the case. Our clients are pushing us to produce better data analytics and they use them to make better investment decisions’.
Large investment managers are now not just gathering a data base, but ‘building data into their system and going from data to metadata,’ said Fiastre.
The market is maturing very fast and expectations are rising along with the level of professionalism involved. ‘It is no longer about bricks and mortar,’ said Kyrill Radev, CEO, EverEstate. ‘Digitalisation is our big chance to change the industry and build scaleable business models. We gather data from customers all along the value chain and consolidate them in a way that’s meaningful to developers’.
Whether it’s tracking property prices or producing market liquidity scores, data analytics are invaluable to buyers and sellers, investors and developers, landlords and tenants, managers and intermediaries.
‘Future business models in real estate will have to be data-based,’ said Meyer. ‘The existence and accessibility of data is key to making properties more efficient and sustainable over the life cycle of the building’.
