Even before the pandemic, the commercial real estate industry was undergoing a paradigm shift, slowly breaking away from tradition and embracing technology in different ways. Intelligent building features and sustainability tools were already a high priority for commercial building owners, landlords, and tenants. According to Forbes, the proptech industry grew by 1,072% from 2015 to 2019. However, the pandemic accelerated efforts in this direction, and now the industry is heading full-speed towards digitization. Proptech is back in the spotlight in 2021, as building owners and landlords rush to bring their properties to the standards that are now required.
What exactly is proptech, and how is it used?
Most people nowadays are familiar with the concept of fintech, which combines finance and technology. Proptech works similarly, and it’s a term used to describe the mix between property and technology. Essentially, proptech encompasses a vast pool of technologies that aim to streamline building and workplace systems and improve the tenant experience. Such technologies range from in-building sensors and touchless technology to security and accessibility features, data collection, and building management.
Proptech is a significant disruptor in the commercial real estate industry in 2021, enabling better communication between landlords and tenants and offering an elevated, safe, and secure tenant experience. As more people return to the office over the coming months, social distancing, air quality, and hygiene will be crucial issues to address, and this is where proptech can help.
Touchless technology such as motion-activated sensors, sensor-activated hand disinfectants dispensers, automatic doors, touchless elevators, and digitized ventilation systems are no longer just nice to have in an office building. These features are becoming must-haves, especially as fears of new coronavirus variants or epidemics continue to loom. Voice-activated commands, facial recognition, or even retina scans are not just for science-fiction movies anymore; they’re slowly starting to enter our everyday lives, at work and home.
Remote building control
Besides integrating touchless technology throughout office buildings, many property owners have begun to embrace digital tools to allow tenants to interact with their workspace seamlessly. For instance, many building owners provide tenant-exclusive mobile apps that will enable employees to book meeting rooms, set up conferences, control temperature and lighting, and have lunch delivered, all in a few taps on a smartphone screen. Think of it like a remote control for the building. Proptech can thus bridge the gap between tenant needs and building features, offering a more personal, immersive, modern digital tenant experience.
Sustainability and efficiency
Not only does proptech enable a seamless interaction between landlords, tenants, and building amenities, it can also support sustainability initiatives and building efficiency. More than ever, sustainable-friendly building technologies are essential, as NYC aims to reduce building carbon emissions by 40% by 2030 and by 80% by 2050. Building owners can no longer ignore the importance and urgency of integrating energy-efficient features, and proptech can help them achieve this. Digital temperature control, motion-activated lighting, and sensor-activated, timer-ready water faucets are just some of the things that can help reduce energy costs in commercial office buildings.
Accessibility and security
Secure and touchless building access are increasingly important factors that owners and landlords focus their attention on nowadays. Keeping tabs on all entry and exit points is more important than ever, as preventing the further spread of the coronavirus and maintaining the safety of employees and building staff is essential. State-of-the-art security cameras, alarms, and emergency systems can ensure the security and safety of the people working in a building, and the technology continues to evolve. Proptech can also improve building access and visitor registrations with the help of touchless technology, fingerprint scans, or facial recognition, eliminating the need for physical keycards or buttons.
Data collection and interpretation
Proptech is meant to simplify and improve the tenant experience and make life easier for office employees. At the same time, proptech puts landlords at an advantage in attracting and retaining office tenants. Nowadays, startups and corporations alike are looking for forward-thinking building owners, and they expect to see landlords embrace technology and offer modern, sustainable amenities. Moreover, proptech and automation technology can help property owners collect crucial data about their buildings, fast and secure, directly in the cloud. Through proptech and digitization, owners can extract real-time information on building efficiency, processes, security, tenant interaction, and much, much more. Then the owner can extract valuable insight from this data to better serve their business goals and ensure tenant satisfaction.
Conclusion – proptech, from ‘nice to have’ to ‘must have’
In a recent Deloitte survey, 48% of respondents said their CRE company is already using digital technologies to strengthen communication with tenants. At the same time, 56% of commercial real estate respondents noted that the pandemic exposed shortcomings in their digital capabilities, so there is certainly room for improvement.
In the current global context, building owners have some significant changes to make to ensure their properties best serve the needs of their tenants. Proptech can help owners provide an improved, safe, secure, and sustainable tenant experience and help landlords attract tech tenants and startups.