Growing global interest in CRE has triggered a large growth of real estate tech startups during 2008–2017 according to Deloitte:
“… cumulative investments in these startups soared from $2.4 billion to $33.7 billion. While venture capital (VC) remains the dominant funding source, there is substantial capital flow from non-VC investors as well, including REITs, established real estate services companies and investors, private equity firms, and high net worth individuals.”
However, even given the outstanding market growth and new technological opportunities, CRE firms have generally been slow to respond and invest sufficient resources to upgrade their antiquated systems.
According to the International Data Corporation’s global survey of CRE executives commissioned by Argus Software,
‘‘nearly one-third of the global CRE industry is still using spreadsheets as their primary tool for asset and portfolio management functions. As a result, there is potentially US $11 trillion globally of CRE assets managed within inefficient and error-prone spreadsheets”.
The case for blockchain
The breakdown of tools used by function shows great potential for blockchain adoption:
Moreover, 76.9% of the CRE C-level and senior executives say that “investment in technology and process improvement to support their firm’s asset and portfolio decision making is a business priority”, according to Argus Software.
Opportunity: Applying AI algorithms to the data stored on the blockchain will empower executives to make better decisions as the mathematical models will be much more accurate
Another area for blockchain adoption is data sharing. CRE professionals across continents share the same problem: lack of industry benchmark data:
Opportunity: Blockchain as an incorruptible public ledger of all transactions that will make the data transparent, free and open to all.