Property management startups making their disruption felt
SOURCE: Khaleej Times
Real estate sector funding and deals topped 19 per cent compared to other sectors.
The UAE's real estate sector is undergoing a massive change with technology paving the way for innovation in every layer of the sector. The inevitable disruption has created a niche for every segment, from traditional buying and selling of properties, to maintenance and management, short-term rentals and holiday homes, among many others.
Digital transformation will change the way property is bought, sold, rented, designed, built and managed. From streamlining documentation processes and more efficient customer marketing, to allowing tenants to access building amenities through an app. Technology is having a transformative impact across the entire value chain.
Research and networking platform Magnitt has indicated in its third-quarter report that out of the top five Mena industries - real estate, e-commerce, delivery and transport, renewable energy and fintech - real estate sector funding and deals topped 19 per cent compared to other sectors.
Startups like Inventally, Mabany, Ajar, HiGuests and Yovza are pioneering the paradigm shift in the sector among other successful players. The virtual buying, selling, maintaining properties, coordinating with facilities management firms are closely being shaped by proptech trends in the country.
Inventally, a niche startup, provides property inventory reports pre and post tenancy to save clients the hassle of disputes, financial claims and security deposit misusage.
Ahmed Al Hassoni COO of inventally, said: "Property management is one the key aspects to running a successful real estate portfolio, and with rise of competition, property managers are facing issues on a daily basis on how can they streamline, outsource or use tech companies who provide them a better way to handle their daily operations better. This allows them to create better customer satisfaction. Physical property managment companies will not necessarily get replaced rather a higher standard will be set out for them, and for those who use these technologies and outsource companies their efficiency will increase and will place them far ahead of local and small scale property managment companies."
Yovza.com, a multi-sided cloud-based platform for construction companies, helps operations to be completely paperless and sees disruption happening faster than one can perceive.
Madan Kumar, founder and chief executive officer of Yovza.com, said: "Real estate and construction are among the ancient industries that have been operating the same way since for ages now. There are approximately a total of 2.05 billion households only from the residential segment across the globe and the average home is valued at $82,000 - not to forget the other forms of properties that has been constructed all this time."
"All these properties are nothing but Amazon of buildings in itself, which were until now mostly managed manually on excel spread sheets and through outdated e-mail channels only. It's not surprising to learn that there is a rise in property management startups as the market size seems pretty monstrous. More startups should be encouraged and welcomed towards a common objective of creating convenience to all stakeholders involved as a whole."
Catch up, or else
Kumar points out that as the majority of property management players are still following traditional ways of managing properties, it will be extremely hard for them to catch up with the change, especially when the generation yet to take over businesses are born with smartphones.
"We have already learnt many lessons from our history on how technology has evolved with time and we could control nothing. The same way, these startups will disrupt the way these industries have been operating for ages and one should not be surprised even if multiple startups coming out from these industries become dragons in the near future as the entire world is yet to witness the true potential of such ancient industries like real estate and/or construction," added Kumar.
"The 20-25 per cent property management fees are a thing of the past in the UAE market," says Rebecca Tyson, general manager at Terrapinn, which is planning to launch 'PropIT' a platform for the property ecosystem to debate, discuss and develop ideas in mid April 2020.
"Startups are disrupting the traditional market and the landlords have the opportunity to deliver higher quality of service to tenants through technology and make a higher margin," added Tyson.