Three trends for PropTech and the built environment in 2020
2019 is now behind us, and it's safe to say that the year was one of innovation and disruption within the PropTech world. It was also a year that brought the field into the public eye, with headlines from Sidewalk Labs and other companies breaking out to attract attention from people with no connection to real estate or building tech.
With all this activity, it might be hard to get a sense of where (and what) PropTech really is. After all, it isn't just property technology that is changing rapidly. The world of real estate itself is also shifting, with new property types, emergent opportunities, and shifting demographic trends influencing an already-complicated industry.
Despite how confusing the industry may seem, things have never been better for the PropTech world. VC money is very bullish on the sector, meaning that lots of companies with new and innovative examples of built environment tech have the chance to make their mark on the business. Awareness of the field is higher than ever before amongst the public, real estate owners, and tenants alike, and so it's fair to say that adoption is now less of a hurdle than in previous years. And of course, the technology itself has never been more advanced, implying a future of potentially endless possibilities.
With that in mind, what will 2020 bring? Here are a few predictions.
1. Mixed uses
Over the course of the next year, expect to start seeing uses blend together within commercial and multifamily buildings. There are two levels to this. First of all, mixed-use development as a project type will probably continue to take the center stage in cities around the world. Secondly, within individual buildings, expect to see blended uses even within the same physical area.
In large part, this means activating spaces within buildings that would traditionally be empty or transitional in nature. Lobbies are a great example of this. As developers continue to put an emphasis on asset fracking, or extracting value from every part of a building, expect to see lobbies turn into spaces meant for meetings, breaks, and other specific uses beyond just waiting for appointments.
2. Emphasis on experience
It's also safe to expect to see a concerted emphasis on experience throughout all types of buildings and workplaces. Similar to upscale hotels around the world, this focus will increasingly encompass every step of a given occupant's interaction with their building, from entry to departure.
"Customizability and user preference will continue to be refined as IoT tools and sensors make it easier to give occupants exactly what they want, when they want it."
With that in mind, expect to see more and more in terms of services available in buildings, as landlords grow their relationships with local businesses and neighborhood partners. Expect tenant experience apps to continue to become a must-have. Customizability and user preference will continue to be refined as IoT tools and sensors make it easier to give occupants exactly what they want, when they want it. And last but not least, it's safe to expect a growing emphasis on indoor/outdoor workspaces that utilize climate control solutions and heavy duty furniture to give employees a new way of working.
3. A couple of big conversations
Finally, 2020 will also be a year of reflection on what we want our spaces to be like. A big part of that will be privacy. Expect to see movement towards a semi-unified perspective on privacy rights in the workplace in 2020, as advocates piece together a realistic and acceptable vision for what protections workplaces need to offer. By the same token, owners and managers will increasingly learn just how far they can go with sensors and tracking in their spaces. While many of these implementations yield direct benefits for the people using these spaces (like better-calibrated climate control or efficient access control systems), the reality is that sooner or later an equilibrium point will be reached on what we are broadly willing to accept. It may differ from country to country, but it is coming.
Beyond privacy, workplaces will have their own conversation about how exactly work should be done. How do hourly roles fit into a global work environment that is all about productivity? What companies will embrace remote working, and how will they leverage new technologies to make it more effective? Which organizations will continue to focus on central office locations, and what will they have to do to remain competitive as Millennials and Gen Z increasingly dominate the workforce?
2020 will be a good year for PropTech regardless of the broader economic environment. Friction is coming, though, both through new technologies and new dialogues on existing ideas. With the new year upon us, let's see how it plays out.
As 2019 just passed us, check out our year in review here.