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2020: The Year of Proptech

Industrial Technology & Innovation Office

While some may look at the failed IPO WeWork as the big story of 2019, the real conversation needs to be focused on the explosive growth within the technology and innovation of real estate. 2019 may have been the biggest year in real estate tech investment—to the tune of $24.9 billion—but 2020 is poised to surpass this number as we continue to look at technology adoption in the real estate sector. With over 150% growth in capital invested in the space since 2018, the momentum is only going to accelerate. Owners, operators, and practitioners are looking for opportunities to disrupt the modus operandi of how real estate has historically been acquired, managed, and operated.

Whether it’s new and innovative auction platforms, property management, and leasing softwares, or changing the tenant experience, those who don’t adapt will be left in the dust, much like we have seen across other sectors that have been influenced by new technology. It’s these early adapters that will start to see separation from the competition as we embark in a new decade of creating efficiencies to increase revenue, reduce operational costs and minimize occupier turnover.

The underlying effects of the increase in PropTech involved the creation of new technologies that directly affect jobs in the office sector—equating to less office space needed—as well as jobs in the industrial sector—as automation replaces people and product—and a drastic increase in coworking and co-living. All of these effects result in a change to how we have traditionally approached our use of brick and mortar real estate.

Heading into this new decade, we will also see a changing of the guard as it relates to brokers and property managers, with owners expecting their service providers to adapt to the ever-changing landscape of efficiency and expediency. As we have become used to getting what we want now—not next week, but now (thank you Amazon and the internet)—it’s clear that those who don’t welcome this changing model, will be looking for opportunities elsewhere.

So, as the PropTech movement continues to gain momentum, ask yourself: Are you paying attention? Because your clients sure are.

Daniel Palmeri, SIOR

Daniel Palmeri, SIOR

Office Specialist
Senior Director, Cushman & Wakefield
Las Vegas, NV
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