Disruption leading to innovation and driving transparency
The growing adoption of proptech platforms, digital tools and ‘big data’ techniques rapidly increase the volume of data available.
The real estate industry is undergoing a transformation as the growing adoption of proptech platforms, digital tools and ‘big data’ techniques rapidly increase the volume of data available. While real estate has been slower to embrace new technologies than other industries, this is changing – in the two years since the last Transparency Index, nearly 1,400 private tech start-ups focused on real estate have been founded and US$16.9 billion in funding raised.
Our survey reveals that the highest level of proptech adoption is unsurprisingly in the ‘Highly Transparent’ markets – such as France, the Netherlands, Australia, the UK, Canada and the U.S., as well as high-income Asia Pacific markets like South Korea, Singapore and Hong Kong SAR. Several larger emerging markets also stand out on proptech adoption – including India, South Africa, Brazil and China – indicating the increased appeal of proptech solutions in markets where traditional data sources or transaction processes are less established.
Disruption leading to innovation
The COVID-19 pandemic is fast-tracking digitization and stimulating innovation in the use of technology due to the need for accurate and just-in-time data to keep track of activity – especially relating to health, mobility and space usage.
The pandemic is leading to an acceleration in new types of non-standard and high-frequency data being collected and disseminated, which is taking transparency to new levels due to its near-real-time nature:
- In the U.S. for example, organizations like the National Multifamily Housing Council (NMHC) and NAREIT pooled data on rent payments from software firms and property owners within a few weeks of the crisis escalating and have maintained this data with subsequent updates. This has provided visibility into a previously opaque indicator and informed both policymakers and business through the crisis.
- Individual companies are also contributing to greater transparency, with Placer.ai, for example, making its retail footfall data publicly available since the onset of the pandemic.
The current disruption may well force the pace of change. Looking ahead to the next edition of GRETI, we expect the widespread adoption of technology, together with advancement in data availability and sensor technology, to play a key role in helping to boost real estate transparency.