Concrete Analysis | Technology will help move the needle in Hong Kong’s traditional property market
Landlords face a unique challenge in understanding the needs of occupiers and their technology requirements
Hong Kong developers and occupiers need to incorporate property technology to ensure the city’s real estate remains attractive.
At the start of the Year of the Dog, the Hong Kong Government unveiled the annual budget with a record-breaking surplus of HK$138 billion (US$17.7 billion). Land sales continue to be a major income contributor. Of the HK$604.5 billion revenue achieved in 2017, HK$121 billion came from land
premiums. With ample cash on hand, the government stressed one of the priorities for the new year is to boost the development of innovation and technology – a whopping HK$50 billion willbe allocated to related industries to help drive the city forward in achieving its Smart City aspirations.
This is a strong indication that businesses across the board should be investing more time and resources into understanding where they stand in terms of their technological capabilities. The real estate sector is no exception. As one of the most dynamic real estate markets in the world,Hong Kong developers need to reassess how they are optimising their assets to attract tenants.
On the other hand, occupiers need to look at how they are incorporating technology to enhance the space and attract talent.
Property technology (PropTech) has gained traction in recent years as one of the biggest trends in real estate. Tenants are keen to adopt technologies that facilitate operational efficiency and cost savings in the long term. Landlords are expected to be more proactive and agile to meet their needs. A 2017 CBRE Research report showed that 84 per cent of landlords expect a rise in smart buildings as a result of tech innovation. Those who understand occupier needs and tech requirements will be at the forefront of this revolution.
Automation and artificial intelligence are already enabling the real estate industry to build powerful tools to help forecast client requirements, map real estate scenarios, make complicated portfolio decisions, and create virtual or augmented realities of work environments.
