Have we finally arrived? Has the real estate sector now reached the turning point of becoming tech-enabled?
Having the right software solution in the real estate industry is no longer seen as a nice-to-have, it is now a must-have. The industry now recognises the importance of digitising processes, in order to remain competitive. In today’s climate, when it comes to better understanding risk and building/protecting a strong reputation, real estate companies must look towards leveraging PropTech solutions.
This was one of the main highlights from MIPIM, a key event in the Real Estate calendar, which took place at the Palais des Festivals in Cannes last week. The event saw 23,000 attendants, 24% of which were property investors, gather to discuss the current state of the property market, the challenges that faced the sector and the future of Real Estate.
MIPIM presents a fantastic networking opportunity for attendants, with a vast array of Real Estate professionals visiting the event, including our Chief Revenue Officer, Andy Kean. Throughout the event, a myriad of different speakers provided their vast insights and expertise in the latest trends within the property sector.
The Undisputed #1 Topic: ESG
ESG was the principal talking point of MIPIM 2023, with a clear focus on how the need for existing buildings to become more efficient is creating opportunities to retrofit. Sustainability has become the buzzword of this generation, with the global charge to create a more environmentally friendly future standing at the forefront of every forward-thinking organisation. This year, the Social aspects of ESG had much more prominence than before as companies get to grips with the needs and obligations of tenants and landlords to provide more to local communities.
The implementation of PropTech solutions is providing businesses with the ESG management tools they need track their data far more effectively than before. Which is enabling them to reach their carbon targets, reduce energy usage and minimise waste production. These discussions were at the forefront of MIPIM, enabling businesses to continue to focus on growth in a sustainable and scalable way.
Gen Z - a New Era of Working
An additional talking point of MIPIM was surrounding the redefinition of the traditional offices, and the role that Generation Z (Gen Z) employees play in this transformation. Businesses need an office, but in order to attract the optimum talent in today’s evolving society, office spaces need to be the best in class, and well amenitized. Being energy efficient is now table stakes.
The last couple of years has seen a colossal shift in the adoption of hybrid working, creating an array of different working behaviours and rapidly changing the way office space is utilised. If MIPIM conversations were anything to go by, there will be no let-up in office investment with several funds raising capital to invest in retrofitting office buildings which are at risk of obsolescence.
Investment & Development
MIPIM 2023 further highlighted that the property industry has recognised the urgent need to digitise processes and data in real-time and accepts that doing nothing is no longer an option. The world is currently in a very challenging time, with rising inflation rates, increased cost of living and a decrease in GDP creating a truly daunting prospect for businesses that are striving to grow and remain competitive.
Despite the ongoing challenges in the market, Andy records how investors are still very optimistic about investing in the market - stating that “investors are currently waiting for the right inflexion point in order to invest, where inflation starts to decrease, the cost of borrowing improves and there’s less of a chance of a recession, to fully realise the value of their potential investments”. Andy proceeded to discuss how, in some instances, deals are failing to complete due to valuations falling well under the vendor expectation.
On the development side, there is significant appetite for BTR, Student and Life Sciences. With any development, however, developers and investors are having to lean more on software solutions to help protect themselves from Volatile Market Risks (VMRs), including increasing build costs, asset value fluctuation, contractor insolvencies, claims and many more. Having a platform which helps them to manage risks and removes operational inefficiencies is now seen as essential.
The Future of PropTech on Real Estate
PropTech solutions such as fu3e. present accurate, real-time data together into a single source of truth, allowing investors and developers to manage risk and make informed decisions at pace. In a rapidly changing world, the ability to view key metrics and report with a couple of clicks and adapt to changing trends using real-time data is paramount.
PropTech holds immense value in increasing the offerings of investors to their markets, allowing them to streamline their efficiency, mitigate risk and grow successfully. Our CRO, Andy records how in times of economic uncertainty, “being able to identify, understand and act on risks ahead of time is critical in ensuring that investors and property developers are staying as competitive as possible in a growing market.”
Kean concludes by stating that almost all investors and developers accept that “doing nothing is not an option”. What they need to understand is that they may need to invest in multiple platforms to cater for every need the business may have. They will spend inordinate amounts of time searching for a single solution that solves everything. There are some excellent solutions designed for these needs and it’s time to commit to the platforms that deliver value where it’s needed most in their business. Over time, it is my expectation that the best platforms will evolve and seamlessly interconnect in the future, if they’re given appropriate investment and support from the industry. #realestate #poweredbyfu3e #mipim2023