Over the decades, we have watched technology revolutionize commerce, communication, information, transportation and, more recently, fintech. However, real estate, the largest global investor class ($32 trillion), remains in the relatively early stages of technology adoption. But we shouldn’t doubt it – the data revolution is fast approaching. Commercial real estate is undergoing a paradigm shift as technology finally catches up with market demands, forever changing the way things once stood.
Just think about the retail market before Amazon, how Facebook changed the advertising industry, or how Uber changed transportation. Frankly, anyone who thinks they can try to work in the real estate industry in the coming years without embracing the best proptech has to offer is not being realistic about the facts.
Technology can and does support the real estate industry in many ways; for example, collecting and analyzing data to measure environmental, social and governance (ESG) performance to enable real-time optimization to improve sustainability factors such as energy use and waste. Key technologies shaping the future of real estate include automation tools, the Internet of Things (IoT), augmented reality (AR), virtual reality (VR), and blockchain..
To date, proptech has perhaps had the most impact in the built environment with the evolution of Internet of Things devices, such as surveillance systems that control buildings, mobile devices, energy smart meters, and a host of other in-building and in-building sensors. plant rooms. Of course, this will accelerate over the next few years. It is also only a matter of time before people realize en masse that investments in sustainable technologies really pay off. We have been in a position for some time now where the finance of sustainable technologies is very clearly taking shape and we are seeing progress and scale in areas such as renewable energy, data and transparency in terms of monitoring energy costs, consumption and impacts.
We’re also facing a disruption in the health and wellness workplace technology space that extends beyond wearables and smartphone health monitoring apps to occupational health monitoring systems, employee engagement programs, virtual assistants, and even smart cabinets. Digital workplace technology creates a much healthier lifestyle for tenants or space users – they are more productive and satisfied with their work, and more content overall, thanks in part to the environment in which they spend their time. When you think about the cubicles that were the offices of the past, people working closely together, coming to work sick because it was the only option, the new way of working helps employees to be healthy, to be present, to be sharp, to be energetic and to allow them to communicate symbiotically with their company culture epitome: her workplace.
The journey we as JLL are on in technology is exciting because as a company it is one of the dominant areas of our business. There are two main aspects to the journey: long before proptech became a buzzword, JLL recognized that there was already so much technology emerging that it was difficult to keep track of what was out there and how it could be used. in the built environment. So in 2019 we’ve officially partnered with MIT to create a proptech hub called the JLL MIT Real Estate Innovation Lab, which tracks emerging proptechs and is also starting to build a data science army, an infrastructure of people who can actually engage with these stories. , to be able to talk to stakeholders and get them thinking about how to make better decisions.
Second, in 2017 JLL has set aside a large sum of money, funded solely from its balance sheet, called the JLL Spark Fund. The goal of this fund was to identify innovative, scalable proptech companies in Silicon Valley, invest in them early to shape them, and then incorporate them into our business and the industry as a whole. Since then, Spark Fund has invested in twenty of the top proptech startups in the world and we are starting to see the fruits of that, which is really exciting and game-changing.
In conclusion, proptech is and will continue to increase the efficiency of real estate, which will ultimately lead to improved returns on assets, reduced friction and greater transparency. Organizations now need to make decisions that help save money, save energy and time, and increase revenue. Organizations must implement the most suitable solutions for them in order to remain relevant and competitive in the market.
The author is Managing Director of Sub-Saharan Africa and the Maghreb, JLL.