How will big tech take PRS to the next level?

Once a small platform used by the middle classes to rent out their houses and flats, Airbnb has overhauled its brand to partner with the likes of Brookfield on hotel-like residencies. Now, the tech disruptor is looking to enter the housebuilding market. Airbnb is due to test its first wave of housing prototypes in late 2019, under its new project dubbed Backyard. It could be described as big tech’s take on the private rented sector. Ultimately, Airbnb originated as an app and website connecting people seeking to stay with those who have listed their own homes on its platform. The company is dominant on a global level, with over 3m listings worldwide in more than 65,000 cities. The company is now aiming to create shared, sustainable, smart homes with the flexibility to adapt to changing occupant needs. Airbnb is not the only big tech firm to move into property development. Google, in the face of fierce local resistance, is planning to build a neighbourhood in Toronto through Sidewalk Labs, which is owned by the internet giant’s parent company, Alphabet. Meanwhile, Amazon’s Alexa Fund has invested in Plant Prefab, a California-based prefabricated home start-up. Frank Filskow, architect at Make Architects, comments: “PRS operators need to look at their businesses as a lifestyle service provider, not a housing developer. “If it’s a service, the way people assess what it delivers is much more fluid and much more competitive. Can you have less space dedicated to you all the time, but access to other facilities?” According to Filskow, there is no provider in the UK offering this, but there is a huge opportunity as investors sign up for long-term commitments as the market and people’s needs evolve. Tech prowess Brand loyalty and convenience play a big role in creating these new communities. And tech companies have a leg-up with their ability to create software that harnesses economies of scale. “The lines are blurring between traditional real estate companies, tech companies and the hospitality sector,” says James Penfold, planning director at The Collective. When it comes to building homes for the future, he says advanced technology and data will be key: “As brands and services begin to play an increasing role in the housing market, technology will form a key differentiator for those players that are focused on brand identity and connecting with their consumer.” The UK’s leading co-living operator, and touted as the largest globally, The Collective recently launched its own app for residents, helping to connect residents across a global community. Moda Living’s app allows residents to report problems and control their thermostat, and offers a virtual door buzzer. The developer was the first to partner with Uber. It has also teamed up with digital wellness platform Hero, which it will use to train staff in mental health, and make use of wearable tech to collect resident data on sleeping patterns, sociability and nutrition to better understand health and promote improved wellbeing. Future-proofing PRS “For a long time, property was in the Dark Ages when it came to adopting new tech, even though it was fundamentally changing everything we were doing from shopping to working,” says Johnny Caddick, managing director of Moda Living. Caddick says long-term investors need to ensure their schemes are “fully future-proofed”. This means understanding how people live now, but also how their lives may change in decades’ time, and creating homes and services equipped to adapt to this. “Of course, it is exciting to see companies like Airbnb and Google move into property development and urban planning, but we shouldn’t be looking at tech companies to shake things up – we should be doing it ourselves,” says Caddick. “The UK property sector needs to quickly mature its collective offer, taking learnings from alternative sectors and international equivalents, and to have a clear ambition.” To send feedback, e-mail emma.rosser@egi.co.uk or tweet @EmmaARosser or @estatesgazette