PropTech, also known as property technology, is taking the real estate industry to new heights. Commercial real estate has grown 3.8% in 2021 and grossed $1 trillion in profits, according to an IBISWorld report.
There are two prominent real estate industry sectors: residential and commercial. Both sectors benefit significantly from PropTech, ranging from increased productivity to better profit margins.
Undoubtedly the commercial real estate industry was harshly impacted by the Covid-19 virus with restrictions to building access and overall construction delays. However, times of crisis force businesses to innovate. Thus PropTech became essential in the rebound of the commercial real estate industry.
After two years of technological advancements in the industry, commercial real estate is now bursting with potential because of PropTech. Here are five benefits of commercial real estate PropTech:
- PropTech provides insights like never before. Pinpointing data will lead to tactical decision-making, resulting in a more profitable bottom line. Once users interpret the data, they can subsequently use it for lead generation purposes. Data can help identify growth areas and be a guiding point, removing any costly guesswork from the equation.
2) Property Management with IoT
- Internet of things (IoT) is the driving force behind smart buildings. Utilizing IoT allows you to manage a building from your fingertips. Examples range from simple details such as turning on and off a light to more elaborate functions such as monitoring building occupancy and utility usage.
3) Virtual Tours
- Providing virtual tours expands the reach of your business. With PropTech, you now have the ability to sell your property to a prospect that lives in a different city, state, or country. Additionally, with virtual tours, anyone can see a space without limitations such as cost and time dedicated to travel. This is a great selling point for many people and will help their decision-making.
4) Optimizing Operations
- As the real estate industry invested more in technology, the industry improved the overall usability of PropTech. This investment resulted in seamless connections across all business functions. With the tools that PropTech can provide, remote work is now possible in the real estate industry, allowing anyone anywhere to execute their job without any major disruptions. This level of control allows commercial real estate to make decisions on a scale they haven't before.
- Ensuring you have the right tenant for your property is crucial for maintaining a consistent revenue stream. Screening tenants online bypasses the hassle of paperwork and has a faster turnaround time. You also avoid issues with applications not being legible or filled out entirely, so you can keep an eye out for rental application red flags.
How will commercial real estate continue to evolve because of PropTech?
A report from TechCrunch in 2020 analyzed that "81% of real estate organizations plan to use new digital technologies in traditional business processes." Although, we really are only at the tip of the iceberg in PropTech, there is fast progress being made. The real estate industry is one of the last to integrate technology in all business aspects fully. Therefore, the business of PropTech has a lot of ground to cover. Other areas that are gaining momentum in PropTech are sustainability and artificial intelligence.