Australia’s real-estate and property sector lags behind many other countries when it comes to embracing and utilising emerging technologies, a new survey has found.
Conducted by the Property Council of Australia in conjunction with real-estate software firm Yardi, the survey of 216 property professionals found that digital technology offered opportunities across the real-estate spectrum.
Moreover, it found uptake of ‘proptech’ (see below) is gaining momentum.
All up, 55 percent of survey respondents say their firms are increasing and enhancing their existing technology systems whilst 53 percent have accelerated adoption of collaborative systems and 27 percent are investing in new systems.
Still, it found that Australia’s real-estate sector was lagging both international counterparts and other sectors of the Australian economy in technology adoption.
All up, 35 percent of respondents believe that Australia is lagging international leaders in proptech adoption.
Meanwhile, 33 percent believe the real-estate sector lags behind other sectors of the Australian economy in technology uptake.
Both around the world and in Australia, the level of investment going into proptech is on the rise.
As noted in The Urban Developer, ‘proptech’ is a broad term which refers to any technology which can be applied across the property or real-estate space.
It encompasses technologies used in planning, design, construction, building or asset operation, renting, buying, managing or selling.
Prior to COVID-19, the Australian Financial Review reported that Australian proptech investment was on track to reach $20 billion by the end of 2020.
Proptech investment house Taronga Ventures has 868 Australian companies on its books whilst proptech network Unissu has recorded a greater than fourfold increase in Australian proptech companies since 2013.
Globally, Metaprop, one of the world’s largest early-stage proptech venture capital firms, predicts that proptech innovation will deliver $205 billion of new value to the real estate industry over the next five years.
As things stand, survey respondents say technologies in most prevalent use include tenant, vendor or investor or portal apps (37 percent), virtual tours (20 percent), big data or analytics (18 percent), Internet of Things 15 percent and artificial intelligence (10 percent).
As noted above, however, respondents believe that Australia’s real-estate sector lags behind in proptech adoption.
Whilst Australia is generally seen as forward thinking, uptake is being hampered by several challenges.
For Proptech companies, larger markets such as the UK, US and China offer deeper client and investment markets along with greater opportunities for growth and scaling up.
Further challenges involved difficulties in technology implementation and cultural barriers to change.
Nevertheless, the report suggest that proptech adaption is likely to grow as companies seek to improve business processes, drive greater revenue, enhance client experiences and improve access to reliable, accurate and up-to-date data.
Such growth is likely to accelerate as a result of COVID-19.
Technologies used to entice workers back into the office, for example, include track and trace systems (23 percent) touchless access (22 percent), social distancing technologies (19 percent), temperature and testing (15 percent), ultraviolet or cleaning technology (13 percent) and other (8 percent).
The COVID period has also seen greater uptake of videoconferencing, online productivity, digital signature systems and online productivity suites.
As a result of the pandemic, meanwhile, 52 percent of survey respondents say their firms intend to invest in collaboration tools whilst 20 percent will invest in project digitisation and a further 10 percent will invest in financial and management reporting tools.
More broadly, survey respondents nominated big data analytics, business process automation and virtual tours as the most influential property technology trends in 2021.
Long term, respondents are investing in property management systems, construction management, artificial intelligence, tenant engagement apps and online marketplace and vendor tools.
Property Council of Australia chief executive officer Ken Morrison says the survey will form the basis of a reliable compass from which to evaluate progress in proptech take-up over time.
Until now, he says Australia has lacked information on the level of proptech acceleration and saturation in our markets.
Meanwhile, Yardi Regional Vice President Bernie Devine is optimistic says 2020 was a “tipping point” for proptech adoption.
“Australia’s property industry is upskilling rapidly. Big hires from other sectors are bringing in new skills in automation, artificial intelligence and customer engagement. These fresh perspectives are shaking up the tree, and propelling proptech forward,” Devine says.
“Investing in technology is like building. Get the foundations right and then everything else will be solid. This is the approach we are seeing from Australia’s real estate leaders.”
Morrison agrees that proptech adoption will increase.
He says Australia’s real-estate sector enjoys a world leading reputation on sustainability, supply chain transparency and social value.
Australian leadership in proptech, he says, will likely follow a similar curve.
Respondents to the survey involved those who worked within across consultancies (30 percent) development companies; (21 percent) investment companies (REITs, pension funds, self-worth fund managers); architecture, design and engineering firms (9 percent), financial institutions (5 percent) private equity fund managers (3 percent) or other companies (19 percent).