Proptech - the shock of the new
Everyone's talking about real estate's tech revolution. But are the professionals involved ready to benefit from it?
Go back 20 years and only 13% of UK households had access to the internet. The figure is now closer to 90%. Over the same period, global internet access jumped from around 4% to just over half of the world's population. The UN predicts that universal global coverage will be achieved by 2050.
From how we talk to each other to the way we consume knowledge, almost every part of our lives now relies heavily on the internet. This is in large part because companies such as Amazon, Facebook and Google used it to create platforms to access the wider population. In just a few decades, ideas that were dreamt up in college dorms, garages and basements have gone on to radically change how we connect with each other and the way in which we transact goods and services.
And it's not just our personal lives – all major transport, energy, financial and communications infrastructure relies on access to the internet to provide services with efficiency and confidence. The same is now becoming true of commercial real estate, which is quickly turning into a consumer industry as the market in "space as a service" grows in popularity. Corporate occupiers, who want to turn their assets into digital platforms that they can use as tools to better understand their employees, are also fuelling this trend.
In the last two years alone, investors have poured more than $20bn into proptech start-ups. With employers engaged in a war for talent, workspaces have become key arenas in the battle to inspire and retain employees – and new proptech innovations are helping them address this challenge.
As we have seen with Amazon and Facebook, companies that can prove their mastery of data – and an ability to use that data to automate decisions – will lead the market. These companies will need data-driven insights to create environments that can change according to individual needs and preferences.
Technology-driven start-ups are not only challenging the traditional business models of our industry; they also raise questions about a shift in responsibility, from human professionals to software. This of course risks blurring the lines of professional accountability. Although machines might be able to work faster than any human, they still have a long way to go before society will fully trust them to comprehend human nuances of cause and effect. The general public will require assurance on the outcomes of all this technological innovation, and this is the key reason why we are developing standards that professionals can use to navigate this untrodden path.
Standard-setting organisations such as RICS can support the industry with rules to deliver confidence to the market. We've already introduced data standards that will protect consumers and businesses by ensuring that the utmost level of professionalism is practised across the built and natural environment. Yet we can only continue to provide this confidence by basing our decision-making on the latest trusted knowledge, data and insight.
This is why we need the best thinkers from across our profession to drive change in our organisation and champion the use of technology. That new thinking must now also flow into, and be a key focus of, our reconstituted strategy body, Governing Council, for which RICS is holding elections this month.
Please go to rics.org/elections and make sure that you vote in these elections, as your support and involvement will ensure that our profession continues to pioneer better places and spaces for future generations.
Chris Brooke FRICS
Chris is the Co-Founder of Brooke Husband Limited, a consulting firm based in Hong Kong which provides strategic market insight, development consulting and investment advisory services to real estate owners, developers and investors throughout the Asia Pacific region.
Chris is also an Independent Non-Executive Director of Link Asset Management Limited, the manager of Link Real Estate Investment Trust.
Chris has 28 years of experience in various fields of the property industry, including 12 years with CBRE during which he held senior management roles in both China and Asia, as well as overseeing consulting activities throughout Asia Pacific.
Chris was previously the Chair of the RICS Asia Pacific World Regional Board, and was RICS Senior Vice President from June 2016 to November 2017.