“Technology and real estate are converging in exciting ways. We’re already seeing the potential of data analytics, artificial intelligence, the internet of things, virtual reality and blockchain to transform how we invest in and occupy real estate in the future,” said Anthony Couse, chief executive officer at JLL Asia Pacific.

What is proptech?

Proptech is integrated techology tools enhancing the consumers, agents, vendors and service providers in the real estate industry. Now, armed with nothing more than a smartphone, tablet or smartwatch, real estate agents are equipped to answer any customer question. “This can be anything from viewing the property safety certificates, or showing the price fluctuations of the surrounding area instantly. Providing such information can put viewers’ minds at ease, leading to an increased likelihood of making a sale.” In addition, proptech such as virtual reality is expected to become more affordable to smaller companies in the near future, allowing Realtors to add selling points to the VR experience. Also soon, 3D printing will allow property developers to address customer preference and environmental issues while offering affordable housing.

In their report: “Clicks and Mortar: The Growing Influence of Proptech”, JLL Greater China says Asia-Pacific start-ups with a proptech tie have raised US$4.8 billion in funding between 179 companies since 2013, which is more than 60 per cent of US$7.8 billion in global investment in proptech. Mainland China and Hong Kong account for 41 per cent of global proptech investment having raised US$3.03 billion, with predictions of proptech investment in Asia-Pacific reaching US$4.5 billion a year by 2020.

 “The findings of the report show that there is a great deal of potential for proptech in Asia-Pacific. With its young population, rapid urbanisation and ‘mobile first’ mindset, all the conditions are in place for this new sector to accelerate, bringing increased efficiencies and better experiences for the end-user,” the report said.

Proptech first emerged in Asia Pacific in 2007 with residential property listing start-ups and now serves larger enterprise needs and the commercial real estate sector. Proptech start-ups are mainly focused in brokerage and leasing, investment and financing, project development, and property management.

“What’s really interesting for a company like JLL is that more start-ups are beginning to emerge that bring solutions that are scalable for big corporate needs,” Couse said. “Once we start to see the application of technologies such as 3D printing, robotics and drones alongside the rise of smart cities in Asia, it could lead to a transformation of the real estate industry.”

“The high cost of living in Hong Kong and the city’s history as a traditional financial centre have arguably held back innovation and the development of the tech industry in Hong Kong,” said Christopher Clausen, associate director of Asia Pacific research at JLL. “The Hong Kong government’s recent launch of the HK$2 billion Innovation and Technology Venture Fund should help spur further growth of the tech, and with it proptech, sector in Hong Kong,” the report said.

Hong Kong’s government can support the development of the tech sector, including proptech, through tax holidays and business incubators for qualifying companies, the report said. “But ultimately it will be market forces that determine whether Hong Kong’s tech industry continues to grow. Hong Kong work visas for expatriates with tech skill sets in demand would also support the growth of the industry,” Clausen said.

Click here to download the JLL Report - Clicks and Mortar: The Growing Influence of Proptech

To discuss the report or if you have any questions email Christoper Clausen via the contact details below. 

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