A new wave of proptech tools are being used to aid in everything from identifying affordable housing to waste management.Chun han
Proptech, short for property technology, is already a growing force in commercial real estate, and now a Toronto tech firm is making it easier for developers to determine where to locate their projects even before they assemble the land.
“Our company is like Google Maps, only it’s for commercial developers. We use technology to help people building projects such as high-rise, multifamily buildings identify new sites,” says Devin Tu, president of MapYourProperty.
MapYourProperty’s technology streamlines due diligence for developers. “It lets them look at issues such as zoning, land use and transit corridors at properties they’re considering buying. A typical developer will look at up to 200 properties per year and only buy one or two to develop; our tool lets them focus on those one or two sites they’ll likely choose,” Mr. Tu says.
“This is the kind of work that can take up to two weeks of research. Our proptech tool can shorten this to 30 seconds,” he adds.
MapYourProperty is part of a new wave of proptech apps and tech tools that are extending the use of technology beyond project management and building maintenance into every aspect of the commercial real estate sector.
“It’s an exciting new industry; it’s early stage,” says Benjamin Shinewald, president and chief executive officer of BOMA Canada, a national umbrella group for building and maintenance operators. “There are new applications and areas of use being created all the time.”
Different areas of the real estate sector are taking notice of proptech’s possibilities. In February, MapYourProperty received a $2.5-million award from Canada Mortgage and Housing Corp.’s data-driven funding program to help organizations – including Habitat for Humanity Canada, Rural Development Network and Toronto Metropolitan University (formerly Ryerson) Centre for Urban Research and Land Development (CUR) – identify affordable housing sites.
Another Toronto proptech company Lane Technologies, which enables building owners and office tenants to manage office life digitally, was acquired by U.S. firm VTS for US$200-million in October, 2021, one of the largest proptech deals to date.
This acquisition anticipates workers returning to offices after COVID-19. Lane’s proptech allows owners to manage leases, while tenants and office workers can use the app to book conference rooms, order food, get through security and connect with nearby restaurants, entertainment venues and other local businesses.
“In our experience, we’re seeing proptech expand to cover a lot of different aspects of the real estate sector,” Mr. Tu says.
“In our case it’s on the predevelopment side; we’re planning to expand our operation to cover areas representing 50 per cent of the population across Canada within the next 18 months. We’re also seeing other proptech being used more to manage office and retail space.”
He says proptech is expanding to areas with programs that use artificial intelligence (AI) to predict housing prices near a development, by factoring in variables such as transit access, nearby prices and infrastructure to come up with ballpark prices in a nanosecond. “But AI can be overhyped. You can use it to predict some things, but not everything,” Mr. Tu says.
Proptech is becoming more important to the circular economy, says Molly Westbrook, executive asset managing director at Cushman & Wakefield Canada. The goal of a circular economy is to minimize waste in every aspect of a business operation, by reducing waste and reusing and recycling materials.
“There are some [proptech] items that are really moving the needle on sustainability,” Ms. Westbrook says. Proptech is already used widely to help buildings increase energy efficiency, enabling operators to manage heating and cooling remotely and to better know exactly where and when maintenance is needed.
Managing waste is the next frontier, Ms. Westbrook says. “Recycling is really key to a building’s operation – how a building streams, diverts and reuses paper, cardboard and plastic can really make a difference to its operating cost and efficiency,” she notes.
“We’ve been introducing AI technology to increase the efficiency of these types of operations,” she explains. Algorithms determine which materials go where to be recycled or reused.
It’s a way to overcome the situation in Canada where, for example, only 9 per cent of plastic waste now gets recycled.
Proptech can also simplify low-tech tasks such as garbage collection, Mr. Shinewald adds.
“In the past waste haulers would remove garbage from the large bins in the ground floors of the buildings on a schedule, say every Tuesday. With proptech, you can put a sensor in the bin to send a message to the hauler when it is full,” he says.
“That way, haulers come on demand rather than on a fixed schedule when the bin may or may not be full. This is not only more cost efficient, but it is more sustainable; it will result in fewer trips to the building,” he says.
As proptech continues to grow in significance, it’s important to reach a common understanding of what it actually is, Mr. Shinewald adds.
“We’re piloting a program that will be the first smart buildings standard for the industry,” he says. This will help current proptech companies, new entrants and potential users know what tools to consider and watch for.
He says BOMA expects to announce the first certified buildings soon, followed by a larger and more public launch of certified smart buildings in the spring.
“This is a made-in-Canada program created by and for the commercial real estate industry,” he says. “It will bring transparency and standards to the sector.”
There’s ample opportunity for proptech to grow in Canada, Mr. Tu adds.
“The field is wide open. In the United States proptech is used more widely, but it’s spreading widely here fast, with new companies and new applications all the time,” he says.