Government support, relative affordability and easy accessibility to financing are among some factors that are driving the boom of PropTech in Asia.
The Asian tech scene is one that is booming like mushrooms springing up after rainfall. While the rise of Fintech initially set the ball rolling for Asian cities, the prominence of PropTech has rapidly come to light in recent times. PropTech, short for Property Technology is a segment of the tech scene that possesses the ability to stand on its own or combine two or more fields of technology under its umbrella. As it stands today, PropTech 3.0 is at peak stage, very possibly moving on to its next phase in the near future.
The Asian region is home to an array of emerging markets making it a playground for start-ups in all fields alike. So what does the dawn of 2019 hold in store for the PropTech industry?
Over the past year or so, multiple capital cities around Asia have been centre stage for PropTech conferences and conventions throughout the region. There appears to be an obvious paradigm shift as prior to this, we witnessed events such as MIPIM in France and Future PropTech UK carried out with a keen focus on the European and North American markets.
While highly disruptive to the real estate conference scene, these go-to names provided a more “elite” platform in the PropTech sphere and appeared to be out of reach for most Asian start-ups, regardless of field. This is no longer the case as we observe an extensive list of PropTech-focused events popping up in the Asian arena. In just a short time, the industry has seen Property Portal Watch Bangkok, Propteq Asia, RISE Asia and Malaysian-grown PropTech conference in November 2018. The accessibility of these events has allowed smaller players in the PropTech industry to strut their stuff and compete with global corporate entities in real estate.
Unicorns have become Asia’s favourite not-so-mythical-creature! With unicorns like Grab, Go-Jek, Sea and Razer, regions like Southeast Asia are headlining internationally and subsequently drawing a significant amount of attention from stakeholders and potential industry players alike. To many, there is a perception that there are better chances for FinTech or e-commerce based business to catapult in the unicorn dynamic in comparison to a PropTech business model simply because of user engagement.
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However, the emergence of what is termed as the Philippines’s first unicorn – Revolution Precrafted has breathed a gush of fresh air and hope into the Asian Proptech Industry. Leading by example, Revolution Precrafted may only be the beginning of tech unicorns for Asia. In Singapore and Malaysia, PropTech and hybrids of PropTech and FinTech business models seem to be predominant, promising great potential at the rise of another disruptive venture.
GOVERNMENT SUPPORT
Another factor due to play a big role in the expansion of PropTech initiatives in Asia is governmental policies across selected regions. The Southeast Asian region in particular appears to be highly welcoming toward incubation and acceleration of start-ups from all walks. In Malaysia, the existence of bodies like MaGiC and MDEC, has paved clear pathways for potential and existing PropTech startups to go forth and explore in this booming digital playground.
The recent GE14 also saw a huge positive turn for policy making in the country, with newly elected members of the cabinet placing focus on technological advancement and progressive law-making.
CO-WORKING POSSIBILITIES
Co-working spaces and flexi working spaces form a big chunk of the PropTech arena. The government of Thailand in 2017 launched ‘Digital Nomad Visas” which allowed for business professionals within the start-up turf to gain entry for a duration of four years. This was followed by a spike of engagement with co-working spaces around the country.
We saw HUBBA Co-Working Spaces take the reins for this segment of the industry and completely disrupt the traditional office model we’ve all come to know over aeons. The thing with co- working spaces though, is that it is very similar to a Pandora’s Box. The possibilities are endless with its utilization and advancement, leading us to believe that we are just now getting started.
In addition to this, Singapore appears to be bullish in embracing PropTech from the blockchain perspective. This too could be highly driven by the fact that Singapore may very well be the first country in Asia in the running to fully embrace the use of cryptocurrencies. While the Monetary Authority of Singapore has not made any statements on the regulation of cryptocurrencies, it still appears to be keen to help firms anchoring in the country. This could very well be a step forward for PropTech players wanting to dabble in the aforementioned.
‘AFFORDABLE ASIA’
Lastly, a key element to Asia being a promising playground for PropTech development is of course, none other than its affordable costs. Apart from various governments providing incentives and reliefs for businesses venturing into technology based models, resources and overhead costs are significantly lower than regions like North America and Europe. Hong Kong especially happens to have largely accessible financing schemes with relatively low interest rates and taxes. Countries like India and Japan also boast highly educated workforces at a lower rate than competitors across the Pacific.
Needless to say, exciting times lie ahead for the PropTech industry in the months ahead. Asia is most definitely gaining a stronghold on all things tech-related, with swiftly emerging tech players making appearances across the region. For those actively involved in the playing field, these are times to be grasping aggressively at every opportunity that they may encounter head on. For the rest of the world, it’s a great time to sit back, relax and marvel at the wonders of what can be termed the ‘evolution of real estate’.
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