The challenges of tech innovation in property and facilities management
There is a disconnect between the property market and the tech space. This is according to Luqman Edu, CVO of FilmoRealty in Nigeria.
Edu was speaking in a panel discussion entitled: “Technology innovations in property and facilities management, “which is part of the West Africa Property Investment Summit held virtually and ending today.
He said that the challenge in the application of tech in the property space is caused by the diversity between the two sectors.
For example, the property industry is traditionally run by an older generation, whereas the tech typically run by millenials; the real estate industry is very capital intensive while they tech space is asset-light, he said.
“The real estate is generally the biggest investment that one can make, and therefore, the biggest risk that one can take,” he said.
These differences in the nature, leadership and approaches of the two industries have created a huge barrier to getting the two sectors to successfully innovate together.
The tech guys don't understand the real estate base, and the real estate people see tech guys as young risk-takers, causing a huge bottle-neck in collaboration and innovation, he said.
There is therefore a low adaptation by property market because the leadership don't want to take too much risk, he said.
Edu acknowledged that there has been a lot of activity in real-estate sales' side of the business using tech.
Millenials, who are essentially in the same age group as the tech leadership, have been quick to set up websites to sell property without having to make big investments in the business. However, there is still a lot less action in the back-end, he said.
Edu cited how investment in fintechs has now become mainstream and is now considered “sexy” and wished that the proptech sector would follow a similar trajectory.
However, the generation mismatch creating challenges between the two sectors is not an issue of education from outside perspective. There must also be an education inside the sectors, he said.
Edu also noted that the property sector should start investing in the sector long before the VCs start approaching them, he said.
Panel moderator Sean Godoy, founder and director of Diversity in South Africa emphasised that the same property fundamentals remain the same, even while the property sector sought to innovate new tech.