Real estate companies slow to adopt PropTech

Only 36 per cent of Canadian real estate companies surveyed have a digital strategy compared to 58 per cent globally, says KPMG report

Canadian real estate companies apparently haven’t jumped on the property technology bandwagon and many risk losing market share or a drop in revenue because of that, says a new report released Monday by KPMG.

The report, Canada’s PropTech Journey: How Canadian Real Estate Companies Are Faring in the Digital Age, says only 36 per cent of Canadian companies surveyed have a digital strategy compared to 58 per cent globally.

While all of the real estate companies surveyed in Canada have appointed a digital leader to oversee their technology efforts, only 28 per cent come from a technology background, comparatively similar to 30 per cent globally, said the report. And while 70 per cent say they feel prepared for a potential cyberattack, only 39 per cent have formally tested how they’d handle one.

“All industries are experiencing some form of disruption; Canada’s real estate industry is no exception,” said Lorne Burns, Partner and National Industry Leader for KPMG’s Building, Construction and Real Estate group, in a news release

“Historically, it’s been a conservative industry, but companies can no longer afford a wait-and-see approach. If you’re not already embracing digital technology and leveraging data, you run the risk of either losing market share or experiencing revenue income erosion or both.

“There are several ways to try out PropTech solutions, whether on a large or a small scale. You won’t be successful with everything you try, but that’s what innovation is all about. Like any significant change, it will feel uncomfortable.”

The report suggests the following ways Canadian real estate companies can embrace property technology:

  • Hiring leaders with digital/technology backgrounds to lead the transformation, rather than appointing real estate leaders from within;
  • Embedding data and analytics into how they run their business;
  • Building a company-wide digital strategy;
  • Partnering with PropTech companies to co-create solutions;
  • Looking beyond streamlining operations and cutting costs to find ways to use technology to improve engagement with tenants, customers, and customers’ tenants; and
  • Assessing their cyber security readiness to ensure their data is well protected.

“Canadian real estate companies are awakening to the digital era, albeit a bit slowly. Now’s the time for them to really dive in,” said Saqib Jawed, Partner and the PropTech Lead for KPMG’s Building, Construction and Real Estate group. “This will look different for every company, of course; large companies with deeper pockets will explore technology in different ways than smaller companies will. But, the only way to find what works for your business is to get started.”

 

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