Fast and flexible, these are the keywords for today's successful business, the real estate industry does not make an exception, although it is still struggling to catch up with the new standards. The last events have surely peaked the issue, but they have also pushed some players outside the comfort zone. Technology is providing the industry with revolutionary solutions that can, and will, define the leaders of tomorrow. Let's see what PropTech is, we have tried to list the main concepts in a clear and complete overview.
What is PropTech?
The keyword PropTech joins two words: property, as offices, buildings, parking lots, neighbourhoods and so on, and technology, as all the digital solutions we use everyday to ease our tasks (or to accomplish tasks that were unimaginable even a few year ago). PropTech is the application of information technology and platform economics to the real estate assets. Take a look to the following schema we drew to have a quick glimpse over the involved technologies and businesses. We listed the technologies down under for a better understanding.
- FinTech: these technological solutions are devoted to help the financial market by supporting faster transactions, big-data aware operations, and creation of new opportunities. The Real Estate industry is already largely benefiting of such platforms to manage mortgage and deals, or to better steer investments.
- ERP/BIM: Enterprise Resource Planning should be already known as tools to manage almost any kind of enterprise. Today they can be connected to Building Information Modelling tools, a set of technologies that digitally represent physical and functional characteristics of spaces, and thus enable smart management of any kind of building. From design and construction to operation and maintenance, BIMs allow to size efforts, to compare virtual scenarios, to remote control assets and appliances, and so on, making decisions easier and work faster.
- e-commerce: it does not need introduction, in the last decade e-commerce has changed every single market. The real estate industry has largely benefited of e-commerce platforms, to the point that many companies' business is just to maintain a digital platform listing long time renting deals or buying opportunities. Today, some of these companies are even offering digital virtual tour of the properties.
- IoT: the Internet of things is a mature trend today, and it involves a wide variety of sectors, from industrial manufacturing to commercial home appliances. The Internet has broken the limits of the digital world and it is blending in the everyday life (some call it phygital, mixing physical and digital). Whether it is automation of any process, or enhanced control over the environment, IoT is changing both the way things work, and the way we interact with them. Buildings, structures, and areas can be provided with thousands of appliances, each one with a single task, and connected to each other and to a central intelligence. When IoT comes at full power, it works with cloud-based technology to orchestrate countless devices located everywhere (it does not make any difference if the buildings to control are distributed across different nations).
When all these technologies are put together in a purpose specific plan they really accelerate the business, fuelling principles like scalability, flexibility, and sustainability. Let's see what happens when a real PropTech access control system is in play.
Cloud-native, real-time, data-driven, business-first access control system
An access control system that can be called PropTech pilots IoT devices, communicates vital information to BIMs, provides business data to e-commerces, and enables FinTech. And much more, as these are only the most prominent features such solution can provide. We want to drill down now to understand more peculiar features of a PropTech access control solution. The following list should be very useful to get why to choose such technology is a dramatic change in the real estate business. If you have any kind of venture or project in mind, try to figure out how it can be improved by the integration of each of these frameworks.
- Cloud-native: the cloud revolution has happened, and many on-prem or local solution are moving on the cloud to respond the market needs for rapidity, availability, and security (not mentioning cost effectiveness). To migrate a solution to the cloud it is not even comparable to building it cloud ready from scratch. Cloud-native application have been designed for the digital future since the very beginning. This make them best perform under primary aspects. A cloud-native access control can scale to control as many structures as needed without growing costs, it cuts maintenance costs to the bone, and it is highly available and secure. Moreover it is highly compatible with any common device (PCs, smartphones, smart watches, ...), and it is basically plug&play, cutting even set up costs.
- Real-time: the market imposes immediate awareness and rapid execution. PropTech solutions have born in this environment, and they are designed for giving to managers and users a solid and fast control over structures. Real-time means that every action can be performed with immediate propagation and effectiveness. For example, managers can be located everywhere in the world when they grant or revoke access right from their smartphones to one or many users. All of this in a fully safe digital environment that provides instant feedback to several other systems or users involved.
- Data-driven: the digital revolution has given business a deeper and clearer sight on reality. With appropriate analytics tools and dashboard, decision makers can understand what it is happening and foresee what is to come, before taking their decisions. Access control systems are largely connected with the business administration of spaces (offices, buildings, neighbourhoods, and so on), thus they have to provide data on people traffic, asset usage, occupancy and more. This is a must for a PropTech access control system.
- Business-first: this aspect hugely differentiate PropTech solutions from previous systems, as the firsts are designed not to accomplish a task only, but to integrate a set of activities and information with business strategy and operations. The only way for setting up a flexible space (a co-working company for example) it is to have appropriate solutions connected according to the right business logic. It is the business strategy that comes first, while the right digital solutions have to shape after it, to work seamlessly and to provide information.
Now that we went trough all the main concepts to understand what a PropTech access control solution is, let's move on to see what it can do, when it is appropriate to implement it, and what are the main aspects to evaluate before adoption.
When and how to choose a PropTech access control solution
Modern businesses and digital aware companies are the environment where a PropTech solution performs at its best. Some of them are already there, and looking for the right tool for their business needs, others are designing and planning, and working to build their future successful business. Such ventures value principles like flexibility, data awareness, fast execution, and seamless operations, and are in need of a secure way to manage their assets that does not compromise on their principles. Those who are conducting or planning a similar business will find PropTech solutions to be perfects for their needs. Co-working and Co-living, flexible work spaces, multi-purpose spaces, modern logistic environments, and so on, can largely benefit from a technology that elevate their operations above physical constrains and hard to manage costs. A special mention has to be done for those ventures that need to manager different spaces or buildings, as the cloud-based solutions allow to centralize the control of structures under one single system natively (it comes included with basic installation), and then to diffuse the control through a secure virtual back-office compatible with every authorized device.
Multi-purpose spaces, smart management, and easy set-up
Flexible space means that its destination can be changed at ease, so that every space can be considered multi-purpose. Landlords can welcome different tenants, and both of them don't need to fear rising arrangement costs. Buildings can be arranged for several purposes, because the use of spaces are controlled by a digital platform that instantly changes access authorizations. Countless users can be authorized to access a structure by just their personal smartphone for a limited period of time, and later all the virtual keys can be remotely wiped. Let's break it down to a list:
- Multi-purpose spaces: the purpose of a building or space is defined by the needs of all stake holders. Landlords, tenants, managers, and users, to mention the key figures, are all involved in the definition of a successful business. Multi-purpose means that a space can serve different needs at the same time, but also that it can connect several different demands. Cloud-native access control solutions support the sharing economy through security and accessibility. Through dynamic management of access the same space can serve a single purpose, or different ones without any hassle, thus maximizing the business value.
- Smart management: management becomes orchestration of several spaces, gates, assets, users, and needs. The same environment can be observed from different point of views, highlighting business indicators (e.g. through analytics of usage or consumption), security indicators, traffic indicators, and so on. Smart management moves space from renting and selling to innovative business models.
- Easy set-up (and retrofitting): this aspect has a very practical foundation in wireless and internet based technology, as smart devices usually don't need any wiring and have integrate intelligence to perform autonomous actions. Well designed devices are also highly compatible and support retrofitting without spaces adaptation. A PropTech access control solution allows space re-designing without added costs (e.g. masonry interventions), but it also provides the capability of immediately change a space purpose by reconfiguring gates and keys, remotely.
New business models and revenue streams
Customer needs may change very fast in the current market situation, and the market itself can have swiping revolutions that harm rigid business models. We have learned that the more a venture is build to be adaptive to the environment, the more it is profitable. The real estate industry has been always considered stable and to relying on long term agreements. The current conjuncture has seen these assumptions radically changed: companies are shrinking their office spaces, workers are encouraged to work from home and smart work, regulators are supporting leasing (i.e. IRFS16 standard). A PropTech solution has (and powers) an as a service selling model, this means that costs can be easily controlled when budgeting, and maintenance is already included, thus avoiding extra future costs. A flexible business model can be set only if based on appropriate digital solutions that meet time management and resources control. One one side, it is mandatory to have a view over the upcoming future through lively data, to take the right decision on time, and to provide investors and stake holders with solid evidences of a healthy business. On the other hand, to be able to react quick to adversities or opportunities is what makes a business successful today. Good entrepreneurs know that they have to equip their business with appropriate tools to being able to steer fast enough toward the right direction.
New models of business are already changing the global market, and it is very likely that others are to come in the next years. Observers are carefully looking at the real estate market as one of the most promising environment where innovation will really change the game.
The right partner for a PropTech based business
Technology changed business from its foundations, a revolution that is still in the making. If you are planning to implement PropTech in your real estate business, be sure to have a good understanding of what it can make for you. Tools like a cloud-native access control solution are meant to change the way business is conduct, they are not only a requisite or a commodity for your company as access control has been in the past. Sofia Locks can help you understanding opportunities and needs related to your project, here you can also find a free white paper on co-design process for more in depth reading.
Or you can simply contact us for further information.