Gaw Focuses on Tech as Asia’s Key Real Estate Trend at Investment Conference

When 500 movers and shakers in Asia’s real estate scene huddled in Hong Kong today to talk about the latest trends in property investment, the discussion quickly turned to technology, from e-commerce to the blockchain, and its role in transforming the industry.

Delivering the keynote address at the PERE Asia 2018 conference, Goodwin Gaw, chairman of Hong Kong-based private equity shop Gaw Capital, flagged technological innovations driving China’s “new economy” as the key trend to watch in the region’s real estate market this year.

As the effects from last year’s uncertainty about international political events have subsided, Gaw told the attendees at the region’s biggest private equity real estate conference that he is watching China’s emerging sectors as the key to growth in the region’s largest economy.

Changing Habits Drive E-commerce Revolution

Gaw discussed how China’s millennials are now relying on mobile technologies to get through the day, with apps providing food delivery, ride-hailing and laundry services.

“People’s habits are so different in China, now all these e-commerce companies get stuff to you within half an hour,” said Gaw. “With this revolution or evolution, is why now people are combining work, socialise, play all in the same room.”

The sharing economy revolution is also transforming workspaces and living spaces, he added, citing the Shanghai-based co-working company naked Hub, which offers a platform for members to collaborate and communicate. Gaw Capital, which has $13 billion in assets under management, led a $33 million investment round in naked Hub that closed in November 2016.

However, Gaw’s own job running one of Asia’s largest real estate funds seems secure for the moment. While noting the progress that players in China and elsewhere in the region have made in implementing artificial intelligence, the chairman of Gaw Capital Partners cautioned that for evaluating potential real estate investments, “I can’t find tech that will replace gut feelings.”

Participants at the event organised by private equity information provider PEI also discussed how the real estate applications of blockchain, the distributed ledger technology that enables cryptocurrencies such as Bitcoin. Blockchain can be used to create smart contracts for buyers and sellers to conduct property transactions online, said John Wong, Vice President of Business Development at Propy, a Silicon Valley-based tech firm.

Market players can use the technology to facilitate investment in real estate projects, for example by converting ownership in a project into digital tokens which can be sold to investors, Wong added.

Data Won’t Replace Humans

While blockchain may be the future of the real estate industry, many property firms are still struggling to break away from their legacy systems, as they face an ever-growing volume of data.

According to Sung Lee, Executive Vice President at tech services provider Altus Group, real estate companies use a scattered array of applications for everything from accounting to asset and properties management — but he expects data will be standardised and commoditised in the future.

“We need a platform for consolidation to happen,” said Lee. “We as an industry has to come together for standardisation. The way we look at data [will be] in a more systematic and standardised way.”

Toronto-listed Altus provides software, data analytics and technology-enabled services to help commercial real estate advisory firms including Colliers International, JLL and Savills make informed business decisions.

As much as technology was hailed at the event, one panelist asserted that humans are irreplaceable when it comes to decision-making. “Technology is important, but it’ll never replace people’s judgment and what people desire,” said Kevin Colket, Managing Director at Starwood Capital Asia. “Even with machine learning, it might help us get better data, but at the end of the day there’s no way you can anticipate [the future].”