DRIVING INNOVATION & TECHNOLOGY IN REAL ESTATE
Innovation has permeated every facet of the industry, with the past five to seven years witnessing unparalleled changes. The COVID-19 pandemic has further accelerated this transformation, resulting in advancements not seen for generations. Consequently, numerous emerging technologies are revolutionizing the entire real estate ecosystem, propelling it into a new era of growth and progress. Sharing his perspective on utilizing the technology platform to maximize data analytics and its applications for the business, Darshan Govindaraju, Director, Vaishnavi Group, expressed, “In today's data-driven market, we can't impose our perspectives on specific buyer sets or micro markets. Instead, we must thoroughly research the area we intend to launch a development by relying on third-party analytics and own on-the-ground investigation. This allows us to create the most suitable product for a given market, such as an apartment, villa, or row house. We utilize various platforms' data, which is generally 80% accurate, to understand transaction volumes and make informed decisions. Previously, developers could launch a project and sell out within minutes. Nowadays, customers are more knowledgeable about their surroundings than developers. This places the responsibility on the developer to deliver the best product by thoroughly analyzing data from multiple platforms.” Agreeing with that, Piyush Gupta, MD, Capital Markets & Investment Services, Colliers, said, “Technology has increased transparency in various industries by providing easy access to data on product preferences, sales trends, and market insights. This aids in product planning and design, as well as property inventory and pricing verification. The integration of virtual and augmented reality has further led to a more immersive and informed buying process. Overall, technology has greatly improved transparency and efficiency in the industry.” Regarding his viewpoint on the comprehensive sales process and its efficacy in promoting and successfully selling products worldwide, Darshan Govindaraju expressed, “In the digital age, almost 100% of homebuyers research properties online, making AR and VR essential tools for property companies. These technologies, now accessible through smartphones, allow users to experience realistic property tours without being physically present. This is beneficial for catering to overseas investors. By integrating AR and VR, companies enable customers to explore properties at their convenience, reducing on-site visits and facilitating decision-making”. Thus, AR/VR technology serves as a facilitator in the real estate market, speeding up decision-making and aiding in effective sales closures. Real estate developers can leverage technology to accelerate sales processes and boost efficiency.” Piyush Gupta commented, “From a developer's perspective, it's evident that investment in emerging technologies is increasing, either to create their own platforms or support innovative start-ups. Prominent investors like HDFC have begun focusing funds on technology-driven real estate companies. As developers aim to integrate their businesses, it's clear that a significant portion of the investment will be directed towards developing proprietary technology.” REAL ESTATE’S CONSTANT EVOLUTION For any sector, constant evolution is crucial as as no single solution fits all situations, more so in case of real estate. As Piyush Gupta states, “Presently, we observe that even traditional business sectors are adopting emerging technology-driven models such as fractional ownership. These advancements enable platforms for investors and investees to come together, enhancing aspects like marketing, design, and planning. As a result, a significant portion of what used to be a brick-and-mortar operation has become technologically driven.” Regarding the cost-effectiveness of utilizing technology in capital or project management, Darshan Govindaraju was of the view, “Technology plays a crucial role in modern real estate, from land identification to post-construction phases. Drones enable faster, more accurate land surveys, while Building Information Modeling (BIM) software facilitates collaboration among project teams. Precast construction methods enhance efficiency and reduce waste, and drone technology allows for real-time progress tracking. Embracing these advancements leads to better decision-making and improved project outcomes. In fact, drone technology has improved construction management, while fractional ownership and REITs have made real estate investment more accessible in India. This allows individuals to invest in smaller portions of properties and benefit from higher yields in commercial real estate. Additionally, fractional ownership provides new fundraising options for real estate companies, making the integration of finance and technology a positive development for the industry.” On business models, Piyush Gupta stated, “In the realm of co-working, co-living, and student housing, traditional residential spaces may not offer optimal convenience. However, India's demographic dynamics have paved the way for shared living concepts and managed residential spaces, are attracting numerous investors and enhancing overall ease within these models.” Darshan Govindaraju added, “The co-working and managed office space industry has shifted focus from freelancers to enterprise clients, leading to a more stable business model with higher potential returns. Market consolidation and dominant players have emerged, promoting long-term stability. Despite a temporary dip during COVID-19, interest in co-working has rebounded. Operators now collaborate with property owners using a "CapEx Lite" approach, providing better returns at prime locations. Understanding real estate yields is essential for tailoring offerings and maximizing profitability in specific micro markets or locations.” In concurrence, Piyush Gupta stated, “The situation presents a win-win for all parties involved – developers, investors, and end consumers. With versatile options like a student and senior citizen housing integrated into city-centric areas, the benefits are evident. Additionally, the focus on customer-centricity and embracing ESG principles – environmental sustainability, social responsibility, and sound governance – further enhances this advantageous environment.” REAL ESTATE’S TRANSITION TO WELL BEING In the past, certifications for office buildings primarily revolved around achieving LEED or other green building standards. However, the current emphasis has transitioned towards prioritizing the well-being of occupants within these spaces. Discussing the ongoing transformation and the increased emphasis placed by developers on prioritizing the end user in both office and residential projects, Darshan Govindaraju articulated, “Today's design focus has shifted from just Green rating to prioritizing wellness in both residential and commercial spaces. Residential developments now include amenities and community engagement opportunities, while commercial spaces emphasize wellness by incorporating open areas and outdoor activities. This trend has significantly influenced modern design philosophy in both sectors.” Piyush Gupta added, “Eco-friendly & Well-being from being a preference have become essential requirements. This transformation is undoubtedly a favorable and notable improvement.” INNOVATION & INVESTMENTS Elaborating on the technology and innovation scenario, Piyush Gupta shared, “We're witnessing a surge in the development of innovative platforms and incubation of diverse companies within project management and construction. In sync, the financing landscape too is evolving. As the real estate ecosystem garners increased attention, technological advancements in shared living, working spaces, and data centers will further emphasize the opportunities for substantial investments specific to India's unique advantages. The future holds immense promise for this fusion of technology and real estate.” Darshan Govindaraju remarked, “While technology can enhance operational efficiency and reach new audiences, its potential in expanding to new markets is still limited due to the industry's human-centric nature. Adopting professionalism in family-oriented businesses can be beneficial, as professionals can contribute their expertise and lay a solid foundation for real estate companies to thrive in an evolving business landscape.” Technology adoption is crucial in today's world, affecting various aspects of businesses, including marketing and project management. Efficient execution of projects using advanced technology tools, contributes to their economic viability. The real estate industry has seen significant consolidation, with well-governed, professional, and adaptable developers remaining. Embracing transformation leads to a strong market position and survival in the competitive real estate sector. The regulatory aspect is more transparent now with information easily accessible online, attributed to utilization of technology platforms that compile relevant data. Technology & transparency is prioritizing customer interests and have become the driving forces in the industry. “Technology has increased transparency in real estate by providing easy access to data on product preferences, sales trends, and market insights. This aids in product planning and design, as well as property inventory and pricing verification.” Piyush Gupta “Despite a temporary dip during COVID-19, interest in co-working has rebounded. Operators now collaborate with property owners using a "CapEx Lite" approach, providing better returns at prime locations.” Darshan Govindaraju “The future holds immense promise for this fusion of technology and real estate”. Piyush Gupta “While technology can enhance operational efficiency, its potential in expanding to new markets is still limited due to the industry's human-centric nature.” Darshan Govindaraju
Tags : driving innovation technology real estate technological business model developments Piyush Gupta MD Capital Markets & Investment Services Colliers Darshan Govindaraju Director Vaishnavi Group launch project data transactions developers product planning apartment villa row house