What is the definition of PropTech in 2021
Taking a retrospective look at our definition of PropTech
A year and a half ago, we ran an article that focused on answering the question of what exactly the word PropTech means. It seems like that was forever ago. In fact, the day we published that article was March 28, 2020, just days after most of the world started shutting down as the first-round response to the outbreak.
Has COVID-19 changed the definition of PropTech? If one event, even one as impactful as COVID-19 could change the definition of a word, it must not have been a very good definition to begin with. Back then, we said the following:
PropTech simply means property technology: technologies of any sort, physical or digital, human or machine, that pertain to real estate and the built environment.
We went forward to provide a few examples of things that aren’t PropTech:
Coworking and co-living aren't PropTech examples. Open-plan offices are not PropTech. The forces impacting commercial real estate, even if they are high-tech in origin, are not necessarily PropTech. A food delivery app that will bring pizza to your lobby is not PropTech. A real estate company investing in real estate to be occupied by tech players is not PropTech. A residential iBuyer is PropTech, but a traditional real estate investor that uses a few advanced algorithms is not PropTech.
None of that stands out as having changed due to COVID-19. But has our experience dealing with the coronavirus meant that this definition changes in other ways? Let’s take a look at some edge cases and find out.
Frequently included in the PropTech dialogue is workplace design. While we said that open-plan offices aren’t PropTech in our article last year, the question has to be asked: Are hybrid workplaces PropTech? If we define hybrid workplaces as ones that use flexible layouts emphasizing task-based work and shared spaces in order to reduce friction, that in and of itself doesn’t seem to check the “tech” box. But if we consider that hybrid workplaces tend to need various technologies to ensure their on-demand spaces and rooms are accessible properly, now we start moving into the world of PropTech. All offices are not made the same. Those that embrace tech to help their occupiers certainly count for our list.
Data-based office management
In a similar vein to the question about hybrid workplaces, what about properties that are managed through the collection and analysis of data derived from sensors and measuring systems? It seems that those certainly count as PropTech, if they use tech platforms like sensors, dashboards, and analytic tools to make substantial improvements to overall management efficiency.
Digital-first brokerages, like Compass, Inc, use a large amount of property technology in the course of their work. While different brokerages utilize tech in different ways, this could include marketing software to automate listings and collateral production, CRMs that can help predict who is likely to transact soon, and automated analysis tools that help prepare pricing estimates or opinions of value rapidly. These are certainly PropTech.
What’s the point?
Each of these three cases are ones where the fundamental work need not lean on tech to be achieved. Workplaces don’t strictly need reservation systems, property managers don’t specifically need sensors and data dashboards, and brokers don’t exactly need to rely on automated valuation models to get their work done. But each of these categories can absolutely be improved by the application of tech.
Whether that implementation is enough to classify a given workplace, owner, or brokerage as inherently “PropTech” is probably not that important of a distinction. As buildings everywhere go digital, perhaps this is a bigger takeaway for the responsive, creative days of 2021 and beyond:
The most effective companies leverage PropTech when it is right, when it is effective, when it will save time and money to do so, not just because it sounds cool.
This is what Spaceflow aims to provide: tech that helps building managers and occupiers use their spaces more effectively, not just for the sake of saying that their building has a shiny new tenant experience app.
To learn more about how Spaceflow can help your property with real efficiency goals, connect with us here.