While real estate is perceived to be a traditional industry, the adoption of proptech provides a shortcut to digital transformation for many industry players by fuelling investment in proptech start-ups. From venture capital to corporate partners, investors are looking to capture the value created by the industry’s digital transformation.
Figures don’t lie. According to property consultant JLL, the number of proptech start-ups has increased 300% over the past decade, with over US$9.7 billion of funding activity in the first half of 2021, the most active first half on record.
In the Greater Bay Area that includes Hong Kong, this trend will continue to see traction in the coming years as policymakers have outlined a blueprint for more land development to support growth, which entails more planning, building and sales activities down the road. Hong Kong is also being repositioned as an innovation hub for the GBA. The proptech trend is more visible than ever.
From the perspective of start-ups and growing ventures, the best way to test their solutions in a real-world setting and get market feedback is to collaborate with a corporate partner, preferably an influential or decision maker. It makes sense for them to gain a large firm as a customer for a number of reasons, not just for money but also it can be leveraged to gain publicity, market knowledge and access to the partner’s customers.
On the corporate side, industry players are also increasingly looking to start-ups as a source of external or open innovation for smart building and construction solutions. However, the cultural differences between corporates and start-ups sometimes make collaboration a challenge.
Great Eagle Holdings, a Hong Kong-listed real estate company with a large portfolio of commercial, residential and retail properties, is an early adopter of a drone-assisted building surveying solution developed by RaSpect Intelligence Inspection, a proptech start-up founded in 2017.
What corporates look for in a start-up?
Akina Ho, Head of Digital Transformation and Innovation at Great Eagle, as well as a board member of the Hong Kong PropTech Association (HKPTA), says collaborations with start-ups are growing in importance as laggards risk being disrupted by rivals or new incumbents who embrace an open innovation strategy...
Mindset changes critical to bridging the gap
Playing on the other side of the table, Harris Sun, CEO and founder of RaSpect, calls for a change in mindset among corporate partners, urging them to not only treat start-ups as vendors but also to invest in and grow with them...
Utilising satellite data, IoT sensors and drones, RaSpect Intelligence Inspection helps developers, property owners, managers and building professionals carry out building surveys to identify defects.
In doing so, drones, or unmanned aerial vehicles (UAVs), are deployed to scan the exteriors of buildings so replacing manual inspections. Based on the findings analysed by AI, the company provides clients with comprehensive reports on the condition of their buildings, enabling them to manage and budget for any necessary maintenance work.
UAVs are also being used to monitor construction sites to ensure that work is being performed in adherence with building codes and plans, he adds. The visual updates during construction enable AEC contractors to identify and fix mistakes early thereby avoiding additional costs.
“Our strength lies in the application of AI and IoT sensing to analyse the content of large amounts of pictorial data. Whether it is a high-rise building, a bridge or a construction site, AI enables us to identify defects or anomalies automatically and accurately in a structure or component. This allows the client to follow up and carry out maintenances when necessary,” says Harris Sun, the company’s CEO and founder.
Early detection of defects in a structure or unusual patterns in the operations of equipment can help predict which part of a building or infrastructure has to be repaired before any potential failure. “Our goal is to provide predictive maintenance solutions that integrate big data, machine learning, AI and other tools to help clients improve maintenance efficiency, enhance safety and cut costs.”