Proptech proves a matter of life or death
From the survival of hospital patients to the health of real estate businesses, property technology can be a matter of life or death.
Property technology, or proptech as it’s widely known, can be a matter of life and death, both figuratively and literally.
The adoption or neglect of proptech can make a business or contribute to its demise but sometimes the stakes are even higher.
Attendees at the Proptech Association of Australia’s webinar Proptech in 2023: What lies ahead? heard how technological innovation in the real estate sector is transforming business but can also save lives.
Julian Kezelman, one of three panel speakers and Program Director for Taronga Ventures, described a company, Trendspek, that has developed technology that employs drones to capture imagery of the exterior of a property asset and is using these photos to create a full 3D model of the asset that can then be used to plan maintenance and repairs.
With working from heights the leading cause of death in the real estate industry, whether in repairs and maintenance or construction, this technology can be a life saver.
“It means not having to go up on the roof of industrial buildings to look for cracks, corrosion and roof deflection,” Mr Kezelman said.
“It’s safe and provides millions of data points rather than just notes on clipboard.”
While using proptech to can obviate personal risk while providing a richer vein of information, it’s also transformed how the healthcare sector can respond to a crisis.
Data used to be seen as gold but is now more like uranium; still incredibly valuable but you’ve got to treat it right or it’s going to blow up in your face.
- Rebecca Cope, Digital Economy Partner, Ashurst
Taronga Ventures has invested in Melbourne-based Spacecube and its unique flat-packable modular building system that enables temporary buildings to be erected quickly.
“They’re making temporary hospitals, so when a ward is being upgraded for example and you need to still provide continuous care, you basically just build a hospital unit in the adjacent car parks.
“These kinds of concepts give asset owners the opportunity to experiment with that asset flexibility and think about new form factors into the future,” Mr Kezelman said.
Saving lives can also translate into helping save the planet.
In the early days of the pandemic, Mr Kezelman said Spacecube built the modular sections of a two-storey hospital medical facility at Monash Health in Clayton, which was then fully equipped within three weeks.
“When it had served its purpose, they then recycled 90 per cent of built form and that hospital is now a community health centre elsewhere.”
Global proptech drivers
While proptech is largely employed to improve business operations and to deliver financial benefits and savings, Mr Kezelman said in Europe the main catalyst for proptech growth was more socially focused.
“Europe is absolutely being driven by ESG (Environmental, social and governance), and that comes from a macro-government level but also from the very responsible capital providers, such as the major Dutch pension funds and the sovereign funds in the Nordic countries.
“They are pushing this message onto their managers and that’s cascading down to the proptech we are seeing emerge in that space.”
Spacecube's pop-up hospital in Melbourne
In the United States, he said proptech companies that had been around for longer and had strong enough balance sheets were starting acquire other proptech businesses and build out broader platforms.
He cited the example of Measurabl, which provides ESG data for commercial real estate owners, who are now buying smart building platforms and other data automation developers so as to vertically integrate their business through the entire property chain.
“From an Asian and Missile East perspective, however, proptech advances are really being driven by construction and urbanisation.
“There are some phenomenal projects being built in Saudi Arabia and they’re looking to build in a fundamentally more advanced way than they have historically.
“We see all these different international pockets of drivers reflecting the underlying markets.”
Dangerous data
The rise of artificial intelligence, and the adoption of technologies such as ChatGPT that are attracting attention for writing student essays and song lyrics, is changing the regulatory landscape around data.
A few years ago data was perceived as the new oil, a rich bounty to be harvested at great profit.
But data breaches, including high profile cases involving Medibank, Optus and Victorian real estate firm Harcourts, has led the Federal Government to talk about higher penalties.
Meanwhile, New South Wales' Minister for Customer Service and Digital Government, Victor Dominello, has been shining a spotlight on the kind of data that is collected by real estate agents and landlords.
Panel speaker and Digital Economy Partner at law firm Ashurst, Rebecca Cope, said proptechs could expect closer scrutiny and tougher penalties if they breached data regulations.
“I like to use the analogy that data used to be seen as gold but is now more like uranium; still incredibly valuable but you’ve got to treat it right or it’s going to blow up in your face.”
Ms Cope said the political and media attention paid to the two big breaches of 2022, as well as the Harcourts incident, meant there was a raft of new privacy legislation in the pipeline.
“The higher penalties were already implemented very quickly by the federal government, so if you are in breach of The Privacy Act, there are maximum penalties of $50 million or three times the value that might be derived from the breach, or 30 per cent of turnover.”
Ms Cope said Minister Dominello was looking to close loopholes that exempted companies with less than $3 million of revenue, including many in the rental agency sector.
“There are a lot of smaller business that are not subject to the Act, and in the real estate sector that means it doesn’t apply to many real estate companies that get access to a lot of sensitive information through the rental application process.”
“We’re going to see more stringent regulations coming our way, and way more active regulators in this space, such as the Office of the Information Commissioner (OIC) who have received additional Commonwealth funding.
“It’s not just the OIC interested in data breaches; for companies handling data they may also find that any other regulatory bodies that they have to be subject to are also going to want to come and have a peek around if you’re in the data breach territory.
“So it’s crucial that people dealing with data and personal information are across all their compliance obligations,” Ms Cope said.
Five proptech predictions for 2023
Tech investment is still about capturing new opportunities and growing businesses. But increasingly tech investment and innovation is a cost of being in business at all - something needed to survive, let alone thrive.
Ashurst provided five tech predictions for the year ahead:
- Climate and ESG: the growing primacy of these issues in decision-making will lead to an acceleration in tech development and investment which facilitates the corporate Environmental Social and Governance agenda. In particular, investment is likely to be focused on monitoring and data gathering tools to improve decision-making (and on the companies which develop such tools).
- Tech and cyber talent: an intensification of the war for talent in a pool of expertise not big enough to sustain demand. How businesses attract and retain tech talent, particularly in cyber, will become more of a decisive factor in how well they cope in an increasingly dangerous cyber environment.
- Cyber resilience: a continuation of the shift in mindset from traditional cyber security to a cyber resilience, recovery and harm minimisation mindset. Those who are not cyber resilient will find themselves in the crosshairs of cyber attackers, who will look at them as the low-hanging fruit. Cybersecurity as a Service offering will prove a popular stop-gap while people plug the holes in their own network infrastructure.
- Hyper-personalisation meets data paranoia: customer expectations for hyper-personalised services coupled with the ongoing paranoia over data leaks will lead to a rise in digital ID solutions as an alternative to storing sensitive personal data. These solutions will reduce the intrinsic value to hackers of the identifiers stored by companies using them, reducing the risk of hacking in the first place.
- Privacy enhancing technologies supporting collaboration: privacy-enhancing technologies and secure platforms will enable collaboration and data sharing (including within the supply chain) while preserving privacy and trust, using emerging technologies such as fully homomorphic encryption (which allows data to be analysed and worked on within controlled parameters while still encrypted) and functional encryption (which provides access to the results of data but not the underlying data itself).
