CBRE’s acquisition of 3-D startup Floored and Blackstoneʼs purchase this month of a slice of London-based temporary workspace business The Office Group are two huge benchmarks of the growing appetite for PropTech innovation by real estate owners, according to industry accelerator MetaProp NYC.
The early stage real estate technology accelerator just released the results of its Q2 2017 Global PropTech Confidence Index which tracks the real estate tech market’s health from the perspective of the most active investors and startup founders around the world.
The index founds that the tailwind predicted late last year has blown deep into 2017 with the confidence level of investors and startup founders now at an all-time high.
According to the MetaProp index, investor confidence has risen to 8.3 from 8.2 and startup confidence jumped to 7.3 from 6.6 on a scale of 1-to-10.
In a key indicator of the PropTech industry’s quickening maturation, 76% of investor respondents said that they expect to see more M&A activity in the upcoming 12 months compared to the previous 12 months, up significantly from 57% in Q4 2016.
“The latest Confidence Index clearly indicates that there is a surge in interest and adoption of PropTech by incumbent companies across the real estate value chain,” said MetaProp NYC co-founder and managing director Aaron Block.
“CBRE’s acquisition of Floored at the end of 2016, along with the recent Blackstone purchase of a majority stake in London based temporary workspace business The Office Group, valuing the company at £500 million, are two huge benchmarks of the growing appetite for PropTech innovation by the most sophisticated of real estate owners, executives and service companies.”
The Q2 2017 Confidence Index showed that 24 percent of startup respondents reported between $500,000 and $2 million in total revenue to date, a major increase from the nine percent that fell in this revenue range in Q4 2016, indicating high revenue growth and rapid startup maturation.
Some 76 percent of startup respondents expect to see more competition within their space in the upcoming 12 months compared to the previous 12 months, up 13 percent from the Q4 2016.
And nearly 40 percent of CEOs believe it will be easier to raise capital in the next 12 months, up from Q4 2016 figure of 33 percent, while only 19 percent of CEOs expect it will be harder to raise capital in the next 12 months, down from 27 percent in Q4 2016.
The survey was designed in collaboration with the Real Estate Board of New York (REBNY) and the Royal Institution of Chartered Surveyors (RICS).
