Exclusive minutes from Propteq Europe 2018 session on Big Data
Is there Big Data in real estate? Does it exist? Do we need it?
Attendee: Either big data exists or doesn’t exist – if it does, how do we use big data to transform the industry. In facility management, there is a huge amount of data that is flowing around. Regarding individual transaction, there isn’t necessarily big data, but if you look at all corporate transactions all over the world, that essentially is big data, so yes there is big data.
CEO of PropTech startup: Building management systems is a prime example of lost big data. They override themselves over time, so until we start to connect everything and put it altogether in one place, we are never going to have that data. So there is big data out there but it is being lost all the time as it gets overridden so we need to begin to capture it. Without standardisation, data is unstructured, so it is laborious to extract anything from it, therefore we need to start standardising the way we collect it. Data is sitting in multiple places and until it all comes together to form big data, it’s useless because you can’t do anything with it. However, as a competitive investor, you don’t want to give away your advantage, so even though our data isn’t organised in a sophisticated way, I wouldn’t necessarily want to share it. There is a reluctance to spend money to bring data together.
Senior Real Estate Lawyer: Real estate transactions are not purely bilateral. There are multiple parties involved. It’s not about one person doing something, you need to have confidence that lots of people will buy into the vision that you have. The banks would need to agree, the facility managements would need to agree, the tenant has to agree, the lawyer have to agree. There are so many people involved in the transaction; one person on their own is really going to struggle to transform that transaction.
Attendee: There are three main parts to it; there is data collection, so where it all comes from. Then there is the stage of how you ultimately interpret the data. Finally who is packaging the data in a way that can be manipulated and interpreted in an intuitive way. Retail is another area where data is increasing and enhancing the relationship between the retailer and property owner. You can demonstrate how many people are going into the store, what their trading is like and if people are under-trading you can understand why. It could be because they are in the wrong place, or the concept is wrong or poorly managed. The relationship becomes more symbiotic when you are able to understand where shoppers are going and what is going on in the actual property.
Attendee: Where I see a huge disconnect is between asset management and property management. If there is some way of bridging these two data sets, for example if good air is very important, how does it get into the brief of big data at the front end. The only way to get it right is if owners at the front end work with everyone else to bridge that gap. Geo-data can be used by, for example, commercial developers to analyse property and see the demographics. For example, for seeing what kind of people like shopping for specific items at a particular retail destination. We can use that data to maximise profits of the whole investment and we can also use that data to share with the tenants and show them how they can maximise revenue.
How do we measure output?
Attendee: Output is difficult to measure. For example, we know that changes in temperature affect people’s output but we cannot measure it easily unless it’s in a lab. Unless we can prove it in controlled environments, transferring that and proving it to people that what to buy these solutions is difficult because the data is not there support it.
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