We keep hearing how the property sector has been one of the slowest to adopt new technologies and that its digital transformation journey is nowhere near other industries that rely on disruptive new tech to maintain productivity levels and enable improved efficiency.
By Stefano Migliore, MD of Office Hub South Africa
It may come as a surprise to learn that in 2019 – before the world was forced to embrace more tech more quickly – $6-billion was invested by proptech funds into innovative start-up solutions alone, $2-billion more than the year before.
Despite the economic challenges this year has presented, Property Week’s annual Power of Proptech survey, conducted during the height of lockdown, reported that: “Regardless of where investments will be made in the months and years ahead, it is clear the property industry is increasingly willing to invest in technology and recognises the benefits it brings their business.”
The survey found that 93% of respondents believe an investment in technology will positively impact revenue in the next five years, while 50% said it would have a significant impact.
Locally, proptech is allowing a new breed of property entrepreneur to be born. These are the owners of space in secondary cities, suburbs and more rural areas across the country who are benefitting from the decentralisation and suburbanisation of the workforce. They have space that’s now in demand; whether traditional offices or they have astutely turned parts of their property into lettable space for use on flexi terms. They are the ones enabling employers to get their staff out of CBDs, travel less, and have somewhere other than home to work for a few hours or days per week.
And it’s proptech that allowing the entrepreneurs to benefit by providing a marketing platform that connects new-style tenants with new-style landlords.
One of the most mature of the proptech meet and match applications is Office Hub, an Australian business recently launched in South Africa. Its AI-driven platform enables anyone to market their space and anyone to find the space that suits them.
For example, a recent retiree from domestic service in Johannesburg is the new breed of property entrepreneur. She is using her retirement golden handshake to set up a lettable space in her rural home where she’ll offer a basic office with access to services like wi-fi, a computer, and a printer. Her customers will benefit from having these services nearby, and she will have an unexpected income stream as a property entrepreneur.
Other non-traditional landlords are those many companies that no longer need the floor space they have; either due to downsizing or rotating and distributing their teams. They can now sub-let that unused space and recoup some of their rental commitment and in fact, bolster their revenue through offering a flexi workspace solution.
The benefit of a Tinder-like proptech solution for the commercial property sector is that regardless of the space being marketed, there’s something for every type of tenant; from the all-in-one WeWork model to a Space-as-a-Service solution which comes without the added services that may be irrelevant for some in context of the world’s new reality of work.
Technology is democratising an industry previously dominated by a few large players and in so doing, is allowing the creation of more entrepreneurs, which in a stuttering economy is most needed and welcome.