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Technology has played a central role in the disruption of many industries, and real estate is no exception. The success technology has had in transforming the real estate industry is perhaps most noticeable within property management, with software advances having markedly improved the intelligent management of buildings.
There are, however, several ways the UK’s commercial real estate development finance industry is lagging behind when it comes to integrating technology.
The market lacks bespoke systems that centrally manage the processes of procurement, sourcing and management of funding smoothly and efficiently in one platform. Lenders have been reluctant to embrace new technologies, causing developers to miss out on innovations. The resistance towards adapting new technologies is an obstacle that the industry must address.
Development finance is riddled with lengthy manual processes that waste time and money. This is where automation technology can have a significant impact. A perfect example is the due diligence process when procuring a new loan, which can massively benefit from automated capabilities.
Some tools in the market have introduced efficiencies at certain stages of the development cycle. For example, some machine learning-enabled underwriting and lending platforms, like Aprao, help commercial real estate lenders determine creditworthiness,. However, a holistic tool that improves the entire process is still missing.
The need for innovative technology that improves the borrower experience in real estate development finance will only grow as the industry continues to evolve and grow. It will only be possible to make these improvements if lenders welcome new technology into the development lifecycle and build systems that optimise every part of the process. An industry-wide shift such as this will ultimately save time and money for both lenders and borrowers.
Daljit Sandhu is a private investor with significant operational and investment expertise developed over a 20+ year career creating, managing, and advising new and established companies. Daljit has successful seed investments in PropTech, FinTech, HealthTech, Entertainment Tech, Data and AI companies. She completed an executive programme with the Massachusetts Institute of Technology in Fintech and is a regular attendee and participant in the world’s leading tech industry conferences.
