The property management and PropTech industries are rapidly evolving in 2023, driven by advancements in the technological landscape and changing customer demands.
Property management is a key aspect of the real estate industry. It involves ensuring that buildings and other types of property are maintained and operated in a manner that promotes their long-term value and utility. In the past year, we’ve seen some interesting trends emerging in PropTech that could introduce a range of benefits for productivity and efficiency in property and asset management for real estate professionals.. Before we get into these trends and how they can impact us, first we need to address some of the challenges facing property managers today.
With the global economy facing multiple headwinds for the year ahead, we are entering a period of heightened uncertainty for real estate management companies. Some of the challenges facing property management and real estate organisations today include:
- Revenue stagnation, higher operational costs, and labour shortages
- Global issues such as inflation, supply chain abnormalities, resurging strains of COVID-19, and the risk of recession
- Labour and skill-related shortages in the industry
On the other hand, some newer opportunities are emerging in the global property management industry such as:
- More property management companies planning to expand in 2023
- The changing outlook of building operations from a “cost” function to a “customer experience” opportunity
- The deepening interest in smart homes and green buildings among buyers
The solution to tackling challenges and leveraging opportunities facing building operators in 2023 is to invest in technology that enables real estate management companies to manage their properties effectively while reducing costs and improving productivity. This is where PropTech or property technology plays a key role in building operations today.
The PropTech industry is evolving at an exponential pace with multiple technologies coming together to change the way we manage real estate. Over the last few years, there has been a phenomenal increase in funding in the PropTech space.
As the way we use our buildings continues to evolve, there are new opportunities to improve building operations. Here are our top PropTech trends that will change how buildings are managed as we enter 2023:
1. Immersive and interactive buildings
In 2023, we can expect more communication between buildings and their occupants, better user experiences, and more automation and collaboration between buildings and the businesses/residents that occupy them.
One area where this technology will have an impact is communicating with building occupants. Real estate managers have always had to communicate with their tenants in some way–whether it’s via signs posted around a property or emails sent through traditional channels like email or text messaging.
But now there are new ways for building managers to interact with their tenants using technology such as smart devices (Internet of Things) that allow residents to ask for building and operational information about their apartment directly. While such applications do seem futuristic, it’s already a reality for many residing in smart homes today. Such immersive buildings combine the best features of technology, art, and design to create an experience that’s more interactive, engaging, and connected than ever before. Projects can even enhance aesthetics using artistic creations with AI.
While the use of virtual reality (VR) and augmented reality (AR) are the more prominent examples of immersive buildings so far, there are also more effective use cases in real estate management. For example, facility managers can implement sensors in their buildings to monitor indoor air quality, temperature, and lighting levels so they can respond accordingly when needed – by adjusting ventilation systems if there’s too much CO2 in the air or dimming lights if no one has been inside for a while. This not only reduces labour costs but also improves customisation of the residence for its inhabitants, making building operations a “customer experience” function, rather than a cost function.
2. Enablement of sustainability practices and decarbonisation
Sustainability practices will continue to be important, and it is anticipated that more real estate management companies will adopt them in 2023. PropTech can be used to enable sustainability practices in property management by providing comprehensive analytics tools, which help building managers understand how their buildings are performing concerning energy usage optimization and other decarbonising activities in building management.
How? For example, an AI-powered platform can analyse data from sensors that are installed in buildings to monitor things like temperature, humidity levels, and CO2 concentrations (among other things). It then uses this information along with weather forecasts from weather stations nearby or on-site (if available) to predict daily peak electricity demand for each unit within a building complex. The system then sends notifications about these peaks so that tenants can adjust their usage accordingly by switching off lights/appliances during peak hours or even reducing room temperatures slightly if required.
Another example is an AI-powered platform that provides real-time data on a building’s energy usage via an app. This allows tenants to understand how much energy they are using and take steps such as switching off lights when leaving the room or turning down the thermostat slightly when they are at home. The system can also provide tenants with tips, tricks, and advice on how to reduce their energy consumption. This can be very useful for people who are new to the area or building and don’t know how much electricity/gas is being used by various appliances in their unit.
3. IoT-enabled predictive maintenance
In the face of labour shortage and the increased pressure real estate managers are in optimising their building operations, we will see more property managers employ IoT-enabled predictive maintenance. This is a form of property technology that uses connected sensors to monitor and predict the performance of machinery, equipment, and systems within a building or facility. Predictive maintenance can be used in property management for situations such as:
- Knowing when to replace parts before they break down
- Identifying energy efficiency issues before they occur
- Detecting water leaks early on so that they don’t cause major damage later on
- Predicting when the next major system failure will occur so that managers can get it fixed
- Reducing energy costs by detecting inefficient operations and taking measures to improve them
- Reducing the amount of time necessary to perform maintenance tasks
- Improving safety by detecting and correcting problems before they become major issues
4. Automation of building operations
Automation of building operations is a key PropTech trend that will intensify in 2023. The automation of facility operations has helped real estate management improve efficiency and reduce costs by streamlining existing processes digitally, making them more consistent and reliable than they’ve ever been before.
Automated processes also mean less redundant work being done by employees. Property management technology will make real estate management companies more competitive and will also enable property managers to focus on revenue-generating areas such as improving resident experience or sustainability of the building.
Automation can also help real estate management companies improve the quality of their building management services by making them more consistent and reliable than they’ve ever been before. This will help property managers to deliver better results with complete oversight of day to day operations, and provide a better customer experience for building occupants.
5. Holistic property management
Another key trend in 2023 will be the use of PropTech for an integrated approach to property management.
Holistic property management is a comprehensive approach to managing real estate properties that considers all aspects of a building or property, including maintenance, finances, sustainability, and tenant relationships. It’s a proactive and integrated approach to property management that aims to optimise the performance and value of the property.
The benefits of holistic property management for real estate managers, facility managers, and building managers include:
- Increased efficiency: Holistic property management streamlines processes, reducing duplication and minimising errors. This leads to increased productivity and cost savings.
- Improved communication: Holistic property management promotes open communication between stakeholders, ensuring everyone is on the same page and reducing the potential for misunderstandings.
- Better tenant relationships: A proactive and integrated approach to property management improves tenant satisfaction, which can lead to longer tenancy agreements and improved relationships with tenants.
- Better financial management: Holistic property management helps to optimise the financial performance of a property by reducing costs, improving revenue, and maximising returns.
- Improved sustainability: By considering the environmental impact of a property, holistic property management can help reduce energy consumption, reduce waste, and improve sustainability.
Holistic property management is about integrating all the different elements of a building into a single platform, so that building operators can manage their entire building as a single entity. For example, holistic property management enables property managers to optimise energy use and maintenance by combining them with occupancy data and other key performance indicators (KPIs).
By integrating these elements into one system, it becomes possible to achieve cost savings by reducing unnecessary costs and improving productivity.
6. Cloud-based property technology
Cloud-based property management platforms are becoming increasingly popular in real estate management in 2023. They allow for easy access to information about different properties and their tenants, making it much easier for managers to stay on top of things. They can also be used to help managers avoid problems with leases, such as late payments or missed rent checks.
In the last few years, we’ve seen a gradual increase in the use of technology to manage building operations. This has been driven by the need to reduce costs, improve efficiency, and make it easier for tenants to access information. The cloud-based property management platforms are designed to help companies manage the day-to-day operations of their properties, from lease negotiations to maintenance requests and even employee scheduling.
The cloud-based software can be used to manage the systems of a building, including heating, ventilation, air conditioning (HVAC), fire alarms, security systems, and lighting. The software offers a range of benefits for building owners, including improved efficiency and cost savings. In addition, it allows users to monitor the performance of their buildings remotely without having to visit them regularly.
In 2023, we expect this trend to intensify as building owners move away from using multiple systems for managing their properties and instead adopt cloud-based property management platforms that can do everything from accounting to maintenance management. These platforms offer a range of benefits including:
- The ability to have real-time visibility into all aspects of operations including financials and maintenance
- Improved efficiency through automation and collaboration across different departments
- Improved customer service through 24/7 access via mobile devices
- Reduced costs by eliminating redundant systems and processes
7. Blockchain integration into real estate transactions
Blockchain technology is still relatively new, but it’s already being used to improve security and transparency in real estate transactions.
Blockchain technology is being used to create decentralised platforms that allow people to make transactions directly with each other without the need for an intermediary. This means that there are fewer costs involved because there’s no middleman or broker involved. The technology is also being used to streamline the process of buying and selling property, making it easier for buyers to access information about properties they’re interested in and reducing the amount of time it takes to complete transactions.
One of the primary ways that blockchain technology improves transparency is by making it easier for consumers to access information about properties they’re considering buying. As an example, a buyer can check to see if a property has ever been foreclosed on or had any liens placed against it.
Blockchain also provides a high level of security for transactions, making it perfect for real estate transactions. With blockchain, stakeholders can be sure that their transaction will be safe and secure because everything is recorded on the blockchain network, which makes it impossible to alter records after they’ve been created.
In addition to improving transparency, blockchain technology also makes real estate transactions more secure by reducing fraud. That’s because blockchain technology allows everyone involved in the transaction (buyers, sellers, lenders) to have access to the same version of the truth about a transaction at any given time. This means everyone involved in a real estate transaction knows exactly what’s going on with their money at all times—and can hold each other accountable for what they’ve agreed upon. Real estate transactions are notoriously opaque. There’s a lot of room for fraud, and even more room for confusion.
Blockchain technology offers a way to keep transaction records secure, visible, and easily accessible so that everyone involved can see what’s happening.
PropTech is increasingly changing the way buildings are managed, making them more efficient and profitable at every stage of the operations and maintenance lifecycles. As building utilisation continues to evolve, there are always new opportunities to improve building operations by using PropTech.
In 2023, we can expect to see more intelligent buildings that use data from sensors on the building’s infrastructure to monitor energy usage and respond accordingly. More intelligent buildings will use data analysis to optimise their operation and user experience. Buildings will also become smarter by using technology to predict when something might go wrong within a building and take action before it does happen.
We can also expect more collaboration between buildings and the businesses that occupy them, and more communication between buildings and their occupants. Property management companies will also automate more of their operations via property management technology enabling building operators to make better and faster decisions.