His colleagues characterize him as a leader, highlighting his ability to understand the situation around him and make the appropriate decisions, in order not only to advance a project but also to successfully communicate the necessary actions to all parties involved. His attention to detail and level of commitment to everything he undertakes is impressive.
In his opinion, the changes coming to real estate are beyond imagination, and they will be guided by interdisciplinary teams that perform at a higher level.
Based on your experience, what is the one proptech breakthrough that is currently or will soon revolutionize sustainability outcomes in real estate?
It’s hard in all honesty to name one breakthrough technology in the sector right now, as there is so much genuine innovation taking place across the built environment. In a recent research paper, we highlighted that USD 5 trillion of commercial real estate and USD 16 trillion of residential real estate faced stranded asset risk worldwide due to energy efficiency regulations. According to a Centre for Cities analysis of energy performance certificate (EPC) data in the UK, 76 percent of the UK’s commercial real estate has an EPC rating of “C” or below, which will render them stranded assets in 2030, when government regulations are triggered. This represents £1.2 trillion of real estate alone, and a whole lot of retrofitting over the next 6.5 years. In order to ensure these retrofits are actually making buildings more sustainable, we’re going to need much wider adoption of enabling technologies.
In fact, c.80% of our portfolio are startups addressing key elements of the pressing ESG challenges we are all facing, and they all bring something different to the table. For example, Airmo helps to monitor CO2 emissions from space, while Danish startup Responsibly harnesses the power of AI to make supply chains more sustainable.
Sustainability is a huge and complex challenge, so adopting innovative approaches across a wide range of areas is going to lead to the most impactful outcomes for our planet.
Why should data be the constant in ESG strategies?
Technology – and effectively utilising data – is absolutely critical in delivering transparent and accurate ESG reporting, which is becoming mandatory for companies across the world.
Every real estate company needs to meet their carbon neutral targets by 2030, and they can’t do that without technology. Trends such as how the future of work is evolving are not going away, so the tech that supports modern, flexible workspace, for example, remains essential. Meanwhile operational inefficiencies are ripe for appraisal during keener economic conditions – and informed, data-driven decisions are the most effective way to achieve strategic ESG goals across the sector.
Residential market is gradually becoming more institutional (B2R, PRS, student accommodation etc.). In what segments of the process / transition can technology contribute the most?
The rise in the price/earnings ratio has shown no sign of abating since the Global Financial Crisis 2008. Many have had to face the reality of living in poor quality rental properties at high rents, while trying to save a big enough deposit to buy a house; and yet they will also see house prices continuing to rise to the point where homeownership remains out of reach.
Innovation can level the playing field, by democratising complex financial processes for a more accessible economy, while built world technologies support more efficient supply of homes and affordable, fit-for-the-future spaces for all. Institutional investors and residential developers are turning to tech-supported solutions for more efficient build and construction processes, as well as management and maintenance.
Meanwhile, tech innovators are clearly paying attention to housing affordability and accessibility issues from a customer perspective. Generation Home, for instance, allows home buyers to pool their finances with relatives and others in order to boost their home buying power and transition from renting to owner occupying. Other solutions to the issues of affordability and costs include the management and distribution of household expenses, as well as the energy efficiency movement aimed at both reduced cost and environmental footprint; Switchee is a Pi Labs portfolio company that has made significant inroads in this area.
The focus currently seems to have been shifted to repositioning property, avoiding stranded assets, and investing in new materials, new building methods and new technologies. Are we doing enough?
The most sustainable new buildings are at the forefront of sustainable delivery – and we’re seeing fierce competition from occupiers vying for the best spaces in real estate, which come with a ‘greenium’ on increased rents.
There is a generation of commercial buildings which will need to be brought up to the required sustainability standards over the next few years to avoid stranded assets – so from a retrofit perspective, there is a huge opportunity to modernise this stock to meet important ESG targets, considering both embodied and operational carbon. From a refurbishment and asset management perspective, landlords are increasingly looking to leverage cutting-edge building tech to ensure cost-efficiency and carbon-efficiency in construction, materials and waste management, as well as operational efficiency in use. Meanwhile, there remains a growing customer expectation that spaces should be digitally connected and amenity rich to suit the flexible working patterns of the future.
Is it PropTech, FinTech, ConTech or some other form of technology that will lead the built environment forward?
Regardless of proptech, fintech or contech – at Pi Labs we simply back the innovators who are transforming our relationship with the built world. Innovation is profoundly shifting how we live, work, own, build, experience and move in the world today. Through every start-up we invest in, we aim to create a better built world, one that will have a lasting impact on our society and proactively addressing the critical issues we collectively face.
Do you consider AI as a threat or a blessing for mankind?
We’re clearly at the beginning of society’s journey with AI, and while we must adopt a thoughtful and considered approach to its application there is clear potential for it to transform multiple industries.
The real estate sector used to think of its occupiers as tenants, but now it knows it needs to think of them as customers, and provide better customer experience. Companies are trying to accelerate that change and level the playing field using technology, including AI solutions.
Through conversational AI tools, customers are able to get quicker, more accurate, and more nuanced responses to questions and requests, while potential tenants are able to access specific and tailored information in the sales process. Real estate landlords in our ecosystem are using AI to improve customer experience – for example, we’re in discussions with an AI-powered conversational customer service assistant, providing voice and text support.
Meanwhile, in the construction world, Contilio, which is one of our portfolio investments, uses AI to digitally visualise construction activity in real time – and project management can be adapted to address any issues, rather than relying on human observation. Those are two practical innovations leveraging AI we’re currently involved with – but we’re excited to see what happens next for our sector.
