63% of European property investors prioritise proptech

3 MIN READAugust 21, 2019

As the world entered the 21st century, technological advancement completely disrupted all walks of life. It has irrevocably transformed how we interact with the world and each other, as well as how we live, work, shop and procrastinate. 

Almost 20 years later, technology drives the success of most modern companies. Brands like Uber and Amazon are clear market leaders because of how far their technology was ahead of their competitors, and how they continually seek future technological advancement to stay ahead of the curve. 

The same can be said for the real estate industry, as developers, operators and investors are relying more and more on proptech. The most proptech usage in the industry is used for better space utilisation, but can also relate to social interaction such as lower marketing costs and improving tenant retention through digital amenities. Most of it is to maximise top line and minimise bottom line costs - meaning companies not sufficiently focusing on proptech are potentially missing out on more favourable yields that would significantly advance the success of the company. 

It would seem quite clear that future revolutionary proptech is a big untapped market opportunity that good investment into would bring enormous yields and an edge against the competition. Union Investment surveyed 150 leading property developers in Germany, France and the UK to see how many are taking advantage. 

63% of companies have already made significant advances into proptech, whereas the remaining 37% are still working on initial concepts or have not even begun to incorporate digitisation into their business strategies. However only a third of that 63% have implemented it and actively use it - the rest have initial concepts and prototypes but have a long way to go before physical use. 16% of respondents don’t regard technology as an important part of their business. 

According to the report, the optimisation of standard processes is the biggest part of the business strategy, with 84% of proptech users saying this tops the list of their digitisation strategy. This was closely followed by the improvement of data protection (82%), the optimisation of customer communication (80%), while the least regarded as important to digitise was tapping into new areas of business (31%).

94% of respondents believe investments into digitisation will pay off in the next five years, with 22% of this believing their investment will pay off immediately. 

For more insight into the European real estate market, Europe GRI takes place on 11-12 September in Paris. 

Article by Matt Harris 
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