Proptech – how the digital revolution is modernising real estate

 In News

Property transactions in Portugal still require mountains of planning permission permits, change-of-use licences, legal paperwork and a whole host of red tape at city and town council levels. That may be about to change.

Text and Photos: Chris Graeme

One of the complaints most voiced by overseas property investors and real estate development associations in Portugal is the time it takes for a project to get off the drawing board and into construction phase.
It was an issue raised earlier this year at the GRI Portugal meeting in Lisbon – an exclusive closed event for property developers, financiers and investors – and again more recently by Portugal’s Association of Real Estate Developers and Investors.
US real estate mogul Anthony Lanier only last month pointed out that good ideas often miss the boat because of the time it takes to get a project from the drawing board to completion in Portugal.
But if planning permission due to paperwork backlogs and staff shortages at municipal councils can take up to two years to obtain, processes in other parts of the sector could speed up, thanks to the development of new digital platforms and applications that are quite literally revolutionising the sector.
In fact, there have been many emerging solutions to the problems of paperwork backlogs, huge transaction costs and planning delays, aside from the much-trumpeted media headlines about Airbnb and other online platforms making estate agency easier for both the agents and their prospective clients – some of these solutions have emerged from Portugal.
Ironically, the real estate market is the largest asset class in the world, worth more than all stocks and bonds combined. In Portugal, it has, over the past three years, generated anywhere between €3 billion and €4 billion, representing a considerable slice of the economy and employment.
However, it has been one of the last to adopt the latest technology and given its importance to the country, neither the government nor local authorities have shown much enthusiasm to help change the situation in this sector.
The time for tech companies to exploit this problem in Portugal is now ripe because of the overall lack of innovation to date. In fact, Excel is still the most commonly used application in property development project management 30 years after its introduction.

What’s changing
Coimbra-based startup company Buildtoo has recognised the need to develop applications aimed at streamlining the project management process from start to finish, involving the initial client, construction firms, architects, law firms and planning and licensing departments.
Benefitting from European Community 2020 funding, this innovative construction project management platform permits an entire building project to be supervised and optimised in real time, from start to finish, between the site building manager to the final client and all entities in-between, both public and private.
“We created this platform in an attempt to allow a client or developer to track whatever is happening in every stage of the development,” says Helder Loio, CEO and Senior Partner at Buildtoo.
“Buildtoo enables this by allowing access to all construction planning and timetables, budgets, documents, blueprints, reports, planning permission processes, messages, supplies and materials, payment plans and so on,” says Loio.

Proptech Challenge
The Portuguese office of international property consultants CBRE has just presented its third edition of Proptech Challenge, a European competition that involves the six markets it covers, including Portugal.
The Proptech Challenge is looking for new and innovative ideas that are disruptive and promise to shake-up the industry. Applications opened on October 7 and close on November 11 with two categories: Disruptive Idea Award and Startup Award.
The projects will be evaluated by a national and international jury which includes CBRE Portugal CEO Francisco Horta e Costa, Miguel Paiva Couceiro, development director at CBRE, Paulo Soeiro de Carvalho, former chief of Economy and Innovation at Lisbon City Council, and Susana Sequeira, founder and non-executive CEO of MSTF Partners and an investor who took part in Shark Tank Portugal in 2015.
Although Portugal did not have a winning entry last year, two Spanish startups, UDE and LOLOLO, did.
Rodrigo Delso, architect and programmer and one of the founders of UDE (Urban Data Eye), came up with a project to manage large urban municipal or retail spaces to maximise their investments. For example, they use CCTV camera footage and apply an algorithm which captures footfall and enable public and private clients to understand the actual way in which space is used.
Another Proptech Challenge winner, Spanish architect Álvaro Cosidó López won the award for best startup for LOLOLO, which means Location, Location, Location. His company uses big data, artificial vision and space syntax to help a company or retail outlet understand the best location for its business or to place a billboard advertisement.

Iberian proptechs
Spanish proptech ArqVR creates immersive virtual reality experiences to bring architectural projects to life and allows them to be presented remotely. It enhances collaboration by enabling multiple users to remotely participate in review sessions. The result is better designs, shorter timelines and more effective processes.
Proptech Factory, a Dutch and Spanish company, provides flexible working spaces for fast-growing technology companies in Portugal while eGO Real Estate from Janela Digital is a state-of-the-art solution which integrates into a single platform a real estate professional site, a real estate CRM software and many online marketing tools specifically designed for the real estate industry.
Casa Sapo is another product from Janela Digital and has created the leading real estate portal in Portugal, advertising 400,000 properties and with over one million hits per month.
Century 21 Portugal is an online platform for real-time search of local real estate (residential or commercial) where the agent can be contacted directly from within the application.

Lagging behind
Despite a few success stories, Portugal has some way to go in adopting or developing sophisticated proptech solutions for a market in which there are few relevant companies and none with the scale and success of proptechs like Purplebricks in the United Kingdom or Redfin in the US.
However, the revolution in real estate technology is starting to build as more startups choose Lisbon, Porto and other cities in which to be based and, with so much overseas investment in Portugal at present, there is certainly market appetite. It is hoped the country will soon be able to meet international standards or any homegrown ideas will probably have to move elsewhere to find development capital.