Angelica Donati is a columnist for Property Week, UK’s leading B2B magazine for real estate. In his third article, she shares a reflection on the turning point in Real Estate, not only as a result of the proptech impact but a shift towards a new paradigm of the sector.
The basis of this change is driven by the advent of new technologies, which have made possible a much more dynamic management of the portfolio, with a relative change in business models.
According to the recent Emerging Trends report in the real estate sector of PwC and ULI, we are at a crucial stage for owners and operators in the sector to mantain or strengthen their performance. A process made faster by the fact that the change in the needs of users and greater transparency of information have accelerated the times for the obsolescence of buildings, generating the need for greater flexibility of the portfolio.
A lot of real estate players are starting to invest in technology – as far as the sector still registers the lowest spending in the IT sector of any other business sector – while others are adopting a “risk capital” approach.
Historically, real estate operators are competing, and the investments needed to build a significant portfolio were effective in order to keep a standard entry level. Today, large tech companies show a growing interest in the “physical” space of the buildings: just think of the Google Smart City project in Toronto or the purchase of Whole Foods by Amazon.
New competitors are entering the market, new interlocutors are present, and therefore the paradigm of an entire sector is changing.