How PropTech Works to Extend Your Workforce – Rese Cleaver
Acquisition teams in REIT organizations leverage technologies in the growing prop-tech industry to drive ambitious business objectives and keep in-step with the ever-evolving markets. Drone technology is playing a significant role in the new technology-enabled acquisitions process. Drones extended the reach and capacity of teams despite travel restrictions and distributed work environments from home offices. As a result, REIT acquisition teams have been able to regain velocity and reach new heights in operational performance.
Historically, an acquisitions team’s core responsibilities – sourcing, analyzing, performing due diligence, and negotiating new equity for the firm – have been dependent upon face-to-face interactions and human-oriented services. Further, the majority of equity portfolios consist of geographically dispersed properties. While the increased prevalence of working from home has increased the average team’s geographical footprint, health and safety measures intending to reduce contact and spread of COVID-19 limit the value gained from this shift to home offices. That said, the travel restrictions and social distancing did present opportunities to reinvent the execution of those core processes. Acquisition teams, in particular, are using technologies — technology-as-a-service most often — to bridge the capability gaps to perform their duties while remote and from distributed locations.
PropTech – The Rise of Technology in Real Estate Operations
Known as “Property Technology” or “prop-tech” for short, is any technology geared toward and used to conduct real estate operation.
Technology in real estate isn’t an entirely novel concept – it initially emerged following the dot-com boom, then has a few more appearances with the introduction of companies like Airbnb. In both instances, technologies were geared towards B2C applications, introducing new platforms to market properties to a broader audience in a more engaging manner.
We are in the midst of the next wave of prop-tech, accounting for the most significant shift to digital in real estate to date. Analysts recognize Proptech as the new FinTech – another enterprise technology sector grown from a need in the finance market.
The shift is a corporate response to surviving [and thriving] in the COVID-19 era, focusing on the operational side rather than the sales and marketing side. Consequently, the technologies funneling into the prop-tech space include new technologies that have previously disrupted other sectors — such as big data, artificial intelligence, and drones, amongst others. These technologies are incredibly transformative to REIT acquisition divisions for two critical reasons: risk reduction and maintaining operations from remote locations. These outcomes unquestionably extend resources’ capacity due to gained efficiencies, improved decision-making, and improved communication.
PropTech Spotlight – Drones
Despite drones being recognized as a top 10 enterprise technology and represent the fastest-growing segment in the transportation sector, many do not know what the uses are. In today’s travel restrictions and social distancing environment, drones supplement boots on the ground in real estate acquisitions with unmanned flight. This approach enables business continuity, but the travel time saved can be applied to other value-producing endeavors within the division. Further, the high-resolution visual deliverables are accessible at-will by all team members and stakeholders critical in the decision-making processes.
Benefiting from drone operations does not require in-house talent or equipment. Using a drone services provider, qualified and commercially certified local pilots are dispatched to property under evaluation — anywhere in the country. Each flight captures high-res imagery and a plethora of data on the area, enabling remote “walk-throughs,” analysis of structural conditions for commercial building inspections, and other assessments of an asset under evaluation.
As drones’ use to supplement activities typically done in-person like site visits and surveys gained traction, additional use cases evolved once the market’s benefits and value became better understood. Thus, the use of drones in acquisition processes is no longer considered a temporary stop-gap in the face of COVID-19. Drone operations are now considered part of the operational standard in the REIT acquisition process.