One of the wonderful things about being in wireless is that it is beginning to transcend into every nook and cranny of every industry, everywhere. From smart dust tiny wireless microelectromechanical (MEMS) devices, the size of a grain of sand, to transportation, agriculture, medicine, you name it, wireless is a part of it.
I hear of new opportunities for wireless technology, daily. One of the more recent appearances is in real estate. Now, obviously, wireless has been part of real estate for some time, but it has been peripheral. The awareness that wireless is becoming a component of real estate is much more recent.
A friend of mine, James Carlini, penned a book called “Location, Location, Connectivity” back in 2014. We have had many discussions around that since then and, as he called it, it is becoming a mantra. And people are realizing it.
Recently there has been a massive proliferation of “PropTech,” the segment of real estate that focuses on wireless in all types of real estate – from smart cities, to retail, entertainment venues, business campuses, and more. These startups have been inundating venture capital firms and other investors with ideas and concepts, hoping to divert some of the coveted investment dollars to develop this segment.
With good reason. In the last two years, more than $18.6 billion has been invested into real estate property technology with more than 25 percent of that, nearly $5 billion, in the fourth quarter of 2017 alone, according to the estate tech research firm Re:Tech. Additionally, globally, PropTech venture capital investments increased by nearly 104 percent from May to June of this year, funding 35 new startup deals.
One does not have to look far to see opportunity on the horizon. A report by Future Cities Catapult, a United Kingdom-based, government supported center for the advancement of smart cities, brings to light a number of relevant, untapped, areas ripe for adoption of Proptech in the real estate sector.
The opportunities vary. From ground-up integration for new builds to retrofit during remodels to upgrades to existing installations. There are also new opportunities in emerging technologies such as 5G, edge networks, mmWave, and small cells.
But, all that glitters is not necessarily gold. As with any emerging segment, there is, yet, no clear vision of where this is heading, other than the common goal of ubiquitous connectivity. Part of the problem is that there is no overall direction from the real estate industry to clearly define and engage technology makers with an understanding of pain points. The bottom line, here, is that the industry itself is having a difficult time getting its hands around all the different aspects of wireless.
Real estate is a bit of a different animal than most other industries. It is so varied, unlike transportation, agriculture, or medicine, because it has a plethora of end games that can vary widely across installations, even within installations.
While nearly all decision makers in the real estate industry agree they need to engage with technology, two-thirds have no clue as to where to begin or what to look at. Much of the lack of clarity stems from an uneven distribution of digital skills and lack of innovation within the real estate sector when compared to other industries, the Re:Tech report found.
One suggestion was to start cataloging – creating a precise and quantitative database of current and emerging PropTech innovations, classified in line with the lifecycle, user needs, and technological drivers. The idea is to identify the use cases and align them with the solutions available.
As well, it was suggested that players develop property Innovation and maturity Indexes to assess a company’s capacity and preparedness for innovation and technology. Furthermore, funding and expansion of institutions such as MIT’s Center for Real Estate is necessary to further research the actual wireless technology needs of end uses, and how the real estate industry can meet those needs.
And, of course, there is the talent gap. Real estate has not, traditionally, been a hotbed of developing technologies. It is a document-centric, legally-mired playground that is more about who gets what, than being connected. But that is about to change.
So, high tech is coming to the industry – quickly and ubiquitously. Just like any other segment, real estate careers will now include digital talent that works in lockstep with managers, sellers, buyers, etc. Wireless will be a major consideration in all real estate ecosystems, going forward.
Finally, there will need to be updated policy and procedure on how real estate dealings will integrate with wireless. No longer will the bounds of property be only physical.