Technology strategy at larger companies is also more likely to be led by someone with a background in technology, the survey suggests. This is true of 44% of companies with more than US$5 billion in assets, compared with 21% of those with US$1 billion to US$5 billion and a quarter of those with less than US$1 billion.
KPMG says this may be because the larger companies have the resources to bring in skilled personnel to own and lead digital transformation. Larger companies are also more likely to have PropTech and digital solutions seamlessly integrated into their core IT systems. Meanwhile, a full quarter of companies under US$5 billion do not have a digital and or technology innovation strategy at all. This compared with just 6% of those with assets over US$5 billion. This trend also applies to data strategies and cyber security.
According to KPMG’s proptech survey, there are three key factors which are preventing further technology adoption within the real estate industry: skills, culture and absence of strategy.
The barriers identified by the proptech companies included unclear returns on investment (40%); not being a business priority (40%); the lack of a designated person to drive the strategy (34%); and – importantly – the lack of the appropriate talent at property companies (27%). Another barrier to collaboration is the retention of talent at property companies. According to the proptech companies, this leads to regular re-treading of ground with new hires.
Andy Pyle, UK head of real estate at KPMG and Chair of the British Property Federation’s Technology Innovation Working Group, explains:
“Real estate companies’ main reasons for investing in IT, digital and proptech collaboration have been to improve efficiencies and decision-making rather than to maximise revenue or increase customer engagement. This attitude has not yet shifted.
“The main drivers of future investment in these areas are still very much along the same lines, along with prioritisation by the board or senior management. This suggests that real estate companies are still missing at least a couple of tricks. There’s a telling contrast with the proptech companies, whose respondents put heavy emphasis on their customer engagement. And the disruptive potential of digital is such that a narrow focus on efficiencies rather than opportunities is unlikely to be helpful.”