One of the reasons the real estate sector is finally embracing technological change is the success of companies and the usefulness of solutions that just did not exist until recently, experts agreed at the PropertyEU PropTech & Innovation briefing, which was held at Mipim in March.
‘There are two types of disruptors: one is collaborative, it helps to improve existing services, while the other seeks to replace traditional players,’ said Csongor Csukás, executive director of international property management, BNP Paribas Real Estate. ‘WeWork, for example, falls in the second category because they have become landlords and operators and are replacing the existing system.’
It is the difference between evolution and revolution. ‘WeWork did not set out to disrupt, they came in because no one in the industry was offering that particular service,’ said Dan Hughes, founder, Alpha Property Insight. ‘The sector is now braced for structural change across the board, from how people are remunerated to how they use data to how they value buildings.’
Valuation models often do not reflect the transformation that is happening, said Csukás: ‘You have to acknowledge that value is probable, not definite. In retail leases are getting shorter and shorter, down to 6 months.’ Retail valuations will be done by footfall, not by sales, because consumers now tend to visit shops for the experience and to look at the products and then buy online, often on their mobile.
Collaborative disruptor
An example of a ‘collaborative disruptor’ is Dashflow, the first artificial intelligence-based digital app for transactional appraisals that allows people to evaluate deals on their mobiles. ‘We give people the data that allows them to apply their judgment, so innovation is enabling the art of valuation to become real,’ said Michael Molloy, founder, Dashflow for CRE.
‘Everyone knows how long it takes to underwrite an asset, how laborious, risky, complex and aggravating it is to assess if it is a good deal or not,’ said Molloy. ‘We are giving people the speed and tools to underwrite more deals and we find there is a very positive attitude towards our app.’
It took three years to work out the best model, but ‘we are very pleased with the take-up since we launched in January,’ he said.
Another example of a collaborative disruptor is Infabode, the online one-stop shop for real estate information, news and research, which celebrated its second birthday at Mipim.
‘Before we launched, it took us two years to get 10 companies to say yes to us, most people just said no because they could not understand this community spirit of sharing research and news all in one place,’ said Josie Nash, business development director. ‘Now we have 450 companies signed up and more keep coming to us.’
There was a lot of suspicion at first because the service was free, she said: ‘People were put off by that, but attitudes have changed and now there is less scepticism. We have seen many cultural shifts in two years. I would say that people now are more open-minded.’
