Technology and real estate may not seem related. But things are changing, and fast, with technology adoption attracting interest from different stakeholders. Recently, global real-estate consultant JLL launched a real-estate technology venture investing their own money.

Tech driven

“We feel technology adoption will likely accelerate in the next few years,” says Anuj Nangpal, Head, JLL India Real Estate Technology Ventures. He gives a few reasons for why the pace is picking up. One, clients need efficient, scalable and dependable solutions, and technology is an enabler for these. Two, many technology solutions have been proven outside India for their effectiveness, building confidence of users here and boosting confidence in adoption.

Nangpal says JLL wants to evangelise the role of technology to various stakeholders — government, tenants, home buyers, finance providers and developers. The company touches nearly every segment in real estate — residential, commercial, real-estate fund, facilities management, procurement and leasing. So improving the efficiencies in the sector would be of strategic interest to JLL.

And by providing mentoring and knowledge, young start-ups can be directed to take a broader industry view. “There is good potential for scale in this segment. So besides the strategic interest, we feel there are opportunities to exit in 4-5 years with a good upside,” he adds. “We are beginning to see some interesting companies that are early enough and are working on problems that are at a global scale.”

The case in point is their first investment, in Foyr, a technology platform for visualising real-estate spaces. Foyr can create 3D environments out of 2D floor plans. Items such as chairs, sofas can be easily dragged and dropped into the environment. Also, rules can be applied to constrain placement. For example, the distance of a table from an electric outlet can be specified and used to decide where the table can be placed.

Together, these enable a commercial tenant to visualise how many employees can be seated in a space to decide on the appearance and the amount of space. This has applications globally, says Nangpal.

Focus segments

In the next 12-18 months, the venture plans to invest in 10-15 early-stage companies working on technologies such as visualisation and augmented reality, artificial intelligence, sustainable energy, water efficiency, smart commercial buildings, smart-city tech applications, property management, data analytics and home automation.

The venture’s investment philosophy will be guided by a few considerations. One, it will invest in technologies that are closely tied to JLL’s work. Two, allied businesses that align with JLL’s functions will be of interest. “For example, we may not create AR or VR solutions for our client, but it is an integral part of the larger one of selling,” says Nangpal. JLL will work with start-ups in deep-technology areas.

Three, there may be new services that would be of interest. Nangpal gives the example of block chain. “We clearly understand that property transactions will go completely online.” Block chain will enable transferring titles fully online with complete security. The venture sees value in investing in this area, with an eye on the future.

Four, smart cities is another concept which may require a lot of technologies coming together. “When a lot of data is collected easily and inexpensively, we need technology such as machine learning to make sense of huge data at city and country levels to derive actionable insights.”

The group is also interested in a wide ecosystem of technologies to create resource efficiencies so that cities are made sustainable and liveable. “Smart homes, and energy- and water-technology solutions are interesting from a sustainability point of view,” says Nangpal.

Most technology development — CRM (Customer Relationship Management) systems, listing services that provide lead generations— are seen as collaborative and bringing in more efficiency, feels Nangpal. Builders, for instance, are opening up to technology — from using drones to survey land, crowd-funding equity for purchase of land, planning projects using software, handling procurement during construction, marketing and selling.

But, there are some cases where it may be seen as a threat to old systems. One example is co-working spaces that are disrupting the basic idea of commercial leasing by moving to a just-in-time model. Likewise, some property-discovery platforms are disrupting the brokerage market.