BrazilJLL responds to real estate disruption with 'proptech' accelerator in Singapore
As the real estate industry faces significant disruption in the coming years, the global real estate consultancy JLL has teamed up with property group Lendlease to launch Singapore’s first ‘proptech’ accelerator.
PropTech, as the name implies, refers to a broad range of emerging technologies and disruptive models focused on the real estate sector, such as digital dashboards for property management and drones and augmented reality for marketing, enhanced geolocational data tools, IoT-powered smart-buildings, and blockchain-enabled transactions to name but a few. Within such a broad, universal sector the applications are just about endless, both for residential and commercial properties, and driven from all corners of the market – buyers, sellers, agents, managers, investors and developers.
If, according to Michael Davis of JLL’s London office, technological innovation in the property sector has been slow to materialise compared to other industries, it’s certainly catching up now. A global survey of real estate decision-makers by KPMG last year found that 86 percent of industry respondents now accepted that digital technology would have an least somewhat significant impact on the market (with nearly half believing it would have a very significant impact) – yet only 13 percent considered themselves to be at the cutting-edge of PropTech developments.
As the KPMG report suggests, real estate businesses haven’t been naturally given to rapid digital innovation – to date, unpushed by the lack of necessity. Now they face a choice, the Big Four firm says; build their own capabilities, buy off the shelf, or enter into partnerships with tech specialists – with the unchartered territory calling for the latter according to KPMG. “Collaboration gives businesses an opportunity to take small steps in their PropTech journey, allowing them to experiment and work together to the benefit of the corporate and the tech company.”
Notably, the report adds that real estate organisations will need to change their mindsets toward traditional procurement models; “Critically, this means engaging actively with innovation and emerging businesses. Organisations need to buy fully into the processes. It is not enough to simply procure a new technology, or promote your involvement with an emerging business, for brand value alone.” One real estate company that has been at the forefront of embracing technological change in the industry is JLL – one of the largest brokerages in the world, with some 300 offices in 80 countries and global revenues pushing $8 billion.
In a recent report from the firm, JLL’s CEO for Asia Pacific Anthony Couse stated, “It’s vital that advisors, brokers, investors and start-ups recognise the challenges and opportunities ahead. Data analytics, artificial intelligence, the Internet of Things, virtual reality, blockchain – all of these will change how we invest in and occupy real estate in the future… I firmly believe the next five years are pivotal for the real estate industry. We must embrace change or be left behind.”
According to figures from the JLL Asia Pacific report, 179 PropTech start-ups in the region had raised funding to the tune of around $4.8 billion since 2013, accounting for well over half of the global investment of $7.8 billion generated between 2013 and mid-2017. For 2015, it reached 85 percent of the total market, up from just 7 percent two years earlier. Of this regional figure, a sizeable chunk headed to China; over $3 billion in fact – a reflection, says JLL, of the nation’s roughly $6.6 trillion total investable commercial real estate space alone.
The figures, however, are somewhat distorted by a couple of Chinese unicorns, and in terms of total deal count, China has been eclipsed by a rising Southeast Asia (which is in turn dwarfed in deal count by India – although the two regions have attracted similar overall levels of funding). JLL puts the slower development in Southeast Asia down to the persistence of traditional consumer habits – even in Singapore, the region’s most mature market. Yet, with Singapore developing as a global hub for blockchain, its openness to automated vehicles, and its healthy start-up ecosystem, a consumer and market embrace of PropTech seems inevitable.
With all things considered then – the market potential, the real estate industry imperative, the region attracting the lion’s share of funding – the lack of industry-led Proptech start-up accelerators programmes in Singapore and further afield in Asia it’s perhaps a little surprising. Cue Propell Asia, a ten-week accelerator programme dedicated to early-stage Proptech start-ups launched by JLL in conjunction with Lendlease – said to be the first proptech accelerator based in Singapore, and the first industry-led programme of its kind in Asia.
Propell Asia
Successful candidates – up to five start-ups in total – will receive a grant of $20,000 and guidance from both successful start-up founders and real estate industry experts. To qualify, applicants will need to demonstrate a clearly defined property technology product in one of four key areas; property management, real estate transactions, construction management, and data collection – utilising technologies such as robotics, blockchain, machine learning and artificial intelligence to improve procurement and user experience, efficiency, decision-making, and enhance safety and productivity across the chain.
The launch of the Singapore accelerator follows the firm’s technology innovation arm, JLL Spark, announcing a $100 million global venture fund for PropTech investment earlier this month. Albert Ovidi, COO of JLL Asia Pacific, said; “Through Propell Asia, we want to discover promising start-ups with sustainable and innovative solutions that can transform the real estate industry. Against the backdrop of rapid urbanisation and the rise of smart cities, our industry in Asia Pacific is primed for the next wave of disruption.”
“Propell Asia is purpose-built to provide start-ups with the platform to accelerate their business success,” adds Tony Lombardo, Lendlease CEO for Asia, closing in the most pertinent point – an industry-led accelerator allows for start-ups to work alongside and gain knowledge from their ultimate customer-base. “Through our integrated business models and networks, Lendlease and JLL will enable participants to access the entire real estate value chain – including investment, development, construction, brokerage, consulting and facilities management – and opportunities to test and validate their products.”
Applications for Propell Asia close on the 17th August with the programme commencing later this year.
