In our latest ‘Leaders in Property and Technology’ blog, we spoke with Ashkán Zandieh, Managing Director at the Center for Real Estate Technology & Innovation (CRETI).
PRODA: Can you talk us through the inspiration behind the inception of the Center for Real Estate Technology & Innovation (CRETI)? What is CRETI’s mission?
CRETI exists to support the financial health and wellness of the proptech industry. In our industry, like many others, the most valuable conversations were always private. We wanted to create a think tank and network to bring the most important financial sponsors in the proptech venture capital industry together to safeguard the future of the real estate technology industry. As a result, we provide research, insights, education, and events to support entrepreneurs, innovators, technology investors, and real estate organizations on the future of the real estate industry.
PRODA: With the global real estate market facing numerous headwinds, how can technology help real estate firms navigate a potential downturn?
High interest rates have heavily disrupted the present value of future cash flows. The results impact valuations, borrowing costs, and property level operations. I think that technology will become ever so valuable in safeguarding a property’s balance sheet, especially as the industry is operating under its narrowest returns. Driving professional and operational efficiency, unlocking ancillary and hidden revenue, and mitigating risks and costs are all areas I think can help real estate organizations navigate a potential downturn with technology.
PRODA: How do you think that the data-led approach taken by modern companies outside of real estate has now started to influence owners and operators within real estate?
In the real estate industry, like many other industries (including finance), data on its own is useless. The areas that I think will continue to grow are artificial intelligence (AI), predictive analytics and smart data. These will enable and empower smarter decision-making.
PRODA: As an expert in the real estate technology field, what’s your proptech prediction for 2023?
In terms of trends, the impact of inflation on the real estate economy is something I’m keeping a close eye on. In the US, The Federal Reserve (“The Fed”) has been amongst the swiftest and firmest to react with quantitative tightening, globally. The Fed’s response to inflation has driven up the cost of capital as well as tightening deposit ratio requirements amongst large banks, pulling even more liquidity out of the market.
In regard to the proptech industry, I think the big trend to watch for is mergers and acquisitions (M&A). 2023 is on pace to have a similar feel to the proptech M&A market of Q1 and Q2 2020. A handful of companies, especially companies with strained balance sheets, will quietly sell or merge with better capitalized or faster growing competitors.
Many thanks to Ashkán for taking the time to speak with us. We will be back soon with another post as we continue to speak to leaders across the industry.
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