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PM Collective - The ART of property management
The ART of property management with Ashleigh Goodchild is a leading platform supporting collaboration not competition through an online community and events throughout the year with one purpose: to create happier property managers. She creates connections for property managers looking to create momentum in their careers and personal life. Join Ashleigh and her guests as they discuss challenges, struggles, mental health, mindset and give advice to property managers and anyone in the industry. To get the support in your property management career, join our PM Collective Facebook and Instagram community.
PM Collective - The ART of property management
Tech Moves, Real Estate Crawls
David Blumenfeld, co-founder of PropTech consulting firm NextRivet, shares insights from his journey in the real estate technology space and explores whether PropTech is moving too quickly for the real estate industry to adapt.
• Began career with Westfield Labs in 2012, focusing on digital integration with physical shopping centers
• NextRivet helps companies bridge the gap between strategy and implementation of PropTech solutions
• PropTech applications range from tenant experience platforms to AI-powered building optimization systems
• Real estate industry is naturally risk-averse with most wanting to be "the first to be fifteenth" in adopting new technology
• Tech vendors need to focus on communicating benefits rather than features when pitching to real estate companies
• Australia shows a strong innovative spirit but sometimes lags in technology adoption due to market size
• Technology adoption doesn't need to be revolutionary – consistent small improvements prevent falling behind
• The key challenge isn't cost but demonstrating ROI for technologies that enhance experiences rather than directly generate revenue
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okay, welcome back to another episode, and today I am bringing along an international guest, which I always love. I've only had a few international guests on my podcast and it's really great for me to. Um, I I'm doing it number one for a lot of selfish reasons, because I love to find out a little bit more about what's happening in in other locations as well. But it's number one for a lot of selfish reasons, because I love to find out a little bit more about what's happening in other locations as well. But it's also just to bring a different voice to the industry in Australia and see sort of what we can learn and also just to be totally aware of what is happening in other locations around the world. So I'm welcoming David Blumenfield and I am going to hand over to you, david, to let you give us an intro about you and who you are and what you've been doing and where you are now. And welcome to the podcast.
Speaker 2:Great, asha, thank you. Thank you for having me. So I am David Blumenfeld. I am the co-founder of NextRivet. We are a prop tech consulting firm working across retail, retail real estate, commercial real estate as well as residential.
Speaker 2:I got my start in the space actually back with an Australian company, back with Westfield Back in 2012,. I was part of a group called Westfield Labs, which essentially was a digital division of Westfield Malls, focused on, essentially, initially, how do you keep the physical property relevant in the face of technology and how do you weave in kind of a digital layer over the physical asset, and so we had a lot of opportunity to test and trial a bunch of different technologies while we were there. You know, obviously we were a shopping center company, not a tech company, and so, excuse me, most of the tech that we sourced was via third parties while we were there. Obviously we were a shopping center company, not a tech company, and so, excuse me, most of the tech that we sourced was via third parties, and my job was really I ran business and corporate development and my job was really to find the companies that we should be working with and then get them on their contract, and my business partner today was the guy who then had the much harder job than I did of actually going and operationalizing all those technologies with our own team and in the physical spaces as well, and so we saw this opportunity with PropProtect really taking off in the last decade and while we were at Westwood because I'm based in San Francisco and that's where the labs was based we had a lot of international groups that would come through San Francisco kind of on their innovation tech tour whether those were big real estate groups or retail groups going to see Facebook and Google and Twitter, kind of the known big tech companies in the area. And once they realized that we were actually kind of obviously doing tech but in their space, we essentially became a stop on that tour.
Speaker 2:And so over the course of six, seven years at Labs we probably met with over 100 different companies, executive teams coming through the Bay Area, and so myself and my business partner were generally the ones presenting what we were up to, and most of the time we were a fairly open book about what we were working on and, honestly, more often than not at the end of those meetings these exec teams would huddle and then turn to us and say, hey, do you think you'd help us out too, and so we saw this opportunity that this is bigger than just what we're doing at Westfield, but this could really be applicable to the rest of the world, and so Westfield was spun out and then acquired, as you may know, late 2019, kyle, my business partner.
Speaker 2:I decided to essentially spin ourselves out and start Next Ribbit, which again is really kind of prop tech for the rest of the world, but really focused on.
Speaker 2:You know, there's a lot of big consulting firms out there that will drop into a beautiful 200 page PowerPoint off on your desk as far as what you need to go and do, and we're not trying to give you a bunch of slide where, while we certainly can do some of that and do some of that ourselves, our wheelhouse is really how do you go from strategy to action? How do you go from the PowerPoint slide and actually get these things lost in live? Because there's a lot of great ideas going around, whether you hire a consultant to help you or you just you know you generate them internally, but the problem is there's not a lot of resources or expertise in-house to really go and figure out what are the things that we should be prioritizing? Who are the vendors and the companies that we should be partnering with? And, ultimately, then, how do we actually get that thing launched and live and working? And so that's really where our focus is.
Speaker 1:So when you talk about PropTech, are you talking about bringing in a specific product into the business, or are you talking about in general?
Speaker 2:looking at tech stacks, it could be both. I mean, I think you know, if you look at kind of traditional real estate tech stacks, there's not a lot of them, to be honest. I mean, obviously, and maybe that maybe that's not fair, but there's. There's kind of the traditional IT, if you will right. Like, if you're talking about a big property, it's, you know, it's the HVAC systems, it's the, you know, it's the lighting, it's the heating, it's all these other, all these things that are kind of going to run the building. And then maybe, if you have guest experiences, it might be websites and apps and ways in which the customer can interact with your property.
Speaker 2:I think you know, as we've, as we come into play, a lot of times companies are like, okay, we have kind of the basics, we have maybe the nuts and bolts. How do we take this and and and and take it up a notch? And so there's really kind of two sides to what we work on. One is kind of the tenant or guest experience. So if you're coming into, say, a multifamily residential property, what's the digital layer that comes over the top of that? Can I open my door digitally, Can I book common area items and amenities from a website or an application. Can I request a maintenance appointment and all the things that kind of go along with that living experience?
Speaker 2:The on the building operation side there's, you know, I think the one place where AI has really come in and helped a lot of these are kind of up-leveled A lot of these systems is really where now you can kind of understand the health of your building. So if you kind of think about if you have a Google Nest in your home for the thermostat and you know understanding kind of the basics or automating some of the basics of your home, now you kind of put that on steroids and say, okay, how can I understand the health of my building? How can I optimize different parts of it? Can I, you know, can I? Can I essentially can I set the controls so that it and really have it set the controls for me where I'm now being more energy efficient and more operationally efficient and the system is essentially thinking for me instead of me having to go and actually manually turn the dials.
Speaker 1:Yeah, okay, I've just written a couple of little notes here because when I talk to people I sort of get different ideas of what is happening in terms of that tech space. But one thing that you just said was the tenant experience or we call them tenants, client experience, and it sounds like you know it's very much they're designed to. There's a focus on that client experience with that a little bit like a concierge service. Is that sort of a general focus point in the US market, like with your tenants? Because I will admit in Australia we probably lack a little bit with what looks like a personalized service. It's very general, but what you were just sort of talking about really sounds quite specific to the needs of that person renting, yeah.
Speaker 2:Yeah, I mean, I think it starts certainly with giving people more access to those services.
Speaker 2:In the building Maybe there's parking and I want a way to kind of easily get it out of parking or the building or access control into the building itself.
Speaker 2:I think you start to put all those things in people's hands, kind of as a digital remote control, if you will, to decide which things I need access to. Then over time, as the system understands what you're actually most interested in, obviously it can start to optimize and gauge what you're really most interested in. If you don't just pre-select that up front. And then, when you talk about some of the things that we work on, which are a lot of times mixed-use properties meaning it's a combination of a shopping center combined with commercial office, combined with residential then can you use digital, kind of to tie the whole ecosystem together. So you as a tenant or somebody who lives on the property somewhere, now can I get you know customized deals and offers from the retailers that are based in, you know, based in that community, and certainly those start to be things that are very customized to the things you want to do versus the things that maybe your neighbor is interested in.
Speaker 1:Yeah, okay.
Speaker 2:So do you have the app for that? We don't. So we're a technology agnostic consulting firm, meaning we don't have our own tech. We're focused on recommending the right tech for the right solution, the right tech for the right solution. And I think that's another kind of point that you work with a larger consulting firm. They may either have their preferred tech or their own in-house tech developed and once you kind of sign on to that, you're kind of locked into them for X number of years because they're the ones that need to constantly develop that tech on your behalf. We're really kind of focused on giving you the access to the right partners and then, if you know, down the line, if in a year or two if you don't like that vendor, you can swap them out, Something may happen to that vendor, who knows? So the whole idea is to be as solution oriented, but again agnostic as far as who we're actually recommending. It's really more about making sure we recommend the right solution for the right project.
Speaker 1:Yeah, amazing. We spoke about what topic we were going to talk about today and the topic was is PropTech moving too fast for our industry? What's your thoughts on that?
Speaker 2:Well, I mean, everything moves faster than the real estate industry, and I always kind of joke that in a lot of business, a lot of industries, everybody wants to be the first to be second. Right, they want to be on the cutting edge, but they want to know at least somebody else did it, especially if they have to justify it to their boss. In the real estate industry it's like everybody wants to be the first to be 15th. I want to know that my entire competitive set or set of peers is doing a lot of these things before I sign off on them. And I think part of that it's an industry that's based on predictable returns.
Speaker 2:It's certainly an industry that's not incredibly risk tolerant, and so when you're talking about technology, you know in a couple of things there too, when you think about real estate, it's a long-term investment. Usually it's a long-term investment. You're looking for returns that are longer term. You're looking for kind of long-term predictable revenue. Technology is kind of the opposite of that right when you can put in systems. But tech is always changing, it's always evolving, and so you need to adapt a lot more quickly and you can't act like an old school enterprise software development shop.
Speaker 2:It's just okay, we have our one, two, three, five-year roadmap. You need to put in place things that maybe you look out over the next year, and maybe there's some foundational pieces that take longer, but ultimately it's okay. The roadmap we have now is probably going to change in a year, depending on you know, depending on what's going on with with technology and I think we're in this fascinating time right now with with you know. You think about where we had the internet and then you had mobile phones and now you have AI. That's been layered onto all that. Things are just just feel like they're accelerating a lot more quickly and we won't go too deep into it, but you have quantum computing on the horizon, which is yet a whole new era that's happening, and so behind the scenes.
Speaker 1:I need to write these big words down. Hold on a second, I'm just going to write them all down so I can Google them later, because yeah. Quantum computing second, I'm just going to write them all down and google them later because, yeah, quantum computing, but I think it's important.
Speaker 2:You know, I think the one really interesting anecdote that I can share from westfield was we're working on a pro on early days, working on a project. It was actually a very cool project we were putting, we were using we were taking a couple of empty storefronts and and turning the glass on the front of those stores into essentially giant iPads, so you could actually walk up to the glass and it would respond to your touch and you could shop that store digitally and actually complete a purchase. And so the idea was especially as you never have perfect tendency, for the most part right, somebody's coming in, somebody's coming out, maybe somebody's remodeling their store, and so, while that store is being remodeled, why not at least give somebody the ability to shop? So really interesting project. And that was something we did back in 2014, I think, 2015. Still pretty cool 10 years later. But as we were going around trying to figure out where we were going to do this, we were working with the center managers and all these things.
Speaker 2:It was like they would talk about moving walls, just like I talk about moving pixels and my. You know I had spent my whole career essentially in digital before and tech before working at Westfield. And so to me, like, moving, we can move a wall, we can. They, you know, they talk about it like incredibly casually and it was like it was kind of you know, one of those mind blowing moments for me and it was like, yeah, it's just time and cost, like we can figure this out. But in the same token, when we talked about moving a simple pixel on a webpage, they had the same reaction like, oh, how do we, how do we do that? Right?
Speaker 2:So there is certainly everybody's kind of has their expertise and I think when physical companies try to start to do a bunch of digital things, it's just it's subject matter expertise that I think you need to have. You know, you need to have both. And if you don't have that in house, I think a lot of times that's where we're able to come in and help, simply because you know we're. You know we're going to come in and talk about you know this, talk about all this tech and how to simplify that and make it understandable for people who have to sign off on the budgets, but we're not going to come in and tell you what to do with your building or how to remodel your building. That's not our expertise at all. So I think it's important to have a good combination of both. Yeah, important to have a good combination of both.
Speaker 1:Yeah, Do you think that there is? I mean, there is a lot of competition with the actual prop tech companies. Like they are just moving so quickly and yeah, and I guess the competition level with them is obviously a lot faster than with us. And that's like, are they aware that it's actually quite confusing for us? You know what I mean? Like they're just all trying to fight for that spot.
Speaker 2:Yeah, I think they are. I mean, I think they're somewhat aware. I think there's also kind of the blissful ignorance of being an entrepreneur and knowing that you're fighting an uphill battle, no matter what industry you're in, and so you just go for it and then start to push through. But there is certainly, especially in real estate, there is kind of an education gap for the most part, and I would say kudos to Stephen Lowe, who was the CEO of Westfield at the time we were there. When we started, he was a neophyte technology-wise, and by the end of our tenure there he was on stage talking about our roadmap and technology. And he did that because he decided okay, I'm going to learn this, I have to take the responsibility as a leader of this company and take this on. And if not, I need to have strong lieutenants who know how to do this. And I think you have to. You have to kind of kind of come to that realization that you're not going to.
Speaker 2:It's not just business as usual, because and I think that's again one of the things where we're able to help out a lot is you know, there is this kind of vendor inundation, right, it's like, oh my God, like I can't imagine and most of you people already have a day job right At a property. How do I take my day job and then also try to weed through and sift through all these vendors who are coming at me. Everybody's using AI somewhere in their, in their jargon, and, and now I have to figure out how to select between these 10 companies. Oh God, what if I miss? You know I'm looking at 10, and what if I missed the 11th? And you know so? So really quickly gets into analysis, paralysis, and then you, then you just don't get anything done Right, and so I think that's that's also where we encourage people. It's like, look like you could try to build this massive roadmap, but you could also just get started.
Speaker 2:And there's a kind of a famous slogan in Silicon Valley like you know, is done is better than perfect. Like you have, you have the opportunity, unlike in physical real estate, where if you build a building wrong or off code or whatever, that's a really time and expensive proposition. You can fail a lot in tech and it's not necessarily that that crazy of an expense, um, it's not going to block people from using your properties, um, but you have to kind of get into that mindset of like. This is not. I'm not building a building for three years down the line. I'm launching some technology. I want it to work. If it doesn't, then I need to pivot and adapt and go from there. And so a long answer to your question. But yes, I think that's one of the big challenges. How do you sift through all the available technologies, because there are way more companies out there than you will even if they all approach you like than you will ever know about, just because in every country everybody's trying to do a lot of the same things.
Speaker 1:Yeah, I know that I always encourage people. Whenever I get random like marketing calls or people wanting to do demos, I actually always say yes to that because I am genuinely curious at what's available. I think that we don't know what we don't know and I think we should always give people the opportunity to do a little pitch to us, because it's not something that you might want to do right now, but you should know exactly what products are available so that if the time comes and you're having a bit of a pain point with something, you know who to reach out to or you know that there is someone there that can fix that problem. So I think we should be a little bit more flexible with saying yes to demos and marketing pitches when we get that phone call and give someone that time just to hear about it. I think we don't do that very well in Australia. I think people are very quick just to fob off I don't have time. I don't have time.
Speaker 2:Yeah, well, I think too though I think of the onus is on the on the prop tech vendors to not come in with an hour long pitch. Right, you need, I think, in this kind of short extent, short attention span theater world, like you come in with a 15 minute pitch as a starter, like be able to tell your story, simplify it, talk about the benefits, not the features. Talk about the benefits and that. You know. So many tech companies come in and talk about their features. I don't care like especially people who aren't that educated on your tech. They don't care about features, they care about how it's going to help their business. And I think if you do that and you can do that very concisely then you have an opportunity to then get the follow-up meeting, which is then the longer meeting where you can go in a lot of doubt about your product.
Speaker 1:Yeah, absolutely.
Speaker 1:So I've written down that what I find at the moment with real estate in Australia and bringing new tech in is you've got the time factor, so that's the time to bring something in, to have those demos, and you mentioned that you know that lack of training.
Speaker 1:So just not having someone in the office to help with that training and making sure that the product is being implemented and used to its you know, to its highest efficiency, and then you've got the money. So, however, I sort of feel like money is not as much of a problem about bringing tech into your business, because if it's really going to genuinely help a pain point, I don't think it really matters as a business owner how much it costs within reason For me with tech. I don't mind spending money on tech as long as I'm using that product at least 80% of its capacity and also making sure that I do have a somewhat tight tech stack, and then I'm not just paying for stuff but not using it to its maximum potential. But for me I don't think money is actually a massive issue. I don't know your thoughts on that and I don't find that good prop tech. It doesn't actually have to be really expensive.
Speaker 2:No, it doesn't have to be really expensive. I mean, I think the money issue comes down more to can I actually find a real ROI on this right? And so a lot of times you're doing technology, we'll go back to the tenant experience example. Like I'm using technology to improve the tenant experience. Could I have leased the space without it? Maybe. And so if there's not a direct revenue line, a lot of times the finance guys, the CFO, is just going to be like well, I can't pencil this out with a five-year return, therefore we're not going to pay for it. So I think it's less about. It's a little nuanced to what you said, which is there is an inherent challenge in explaining the value if it's not directly monetizable. That, I think, holds up the budget discussion, maybe more so to your point than an actual price point, as long as it's within reason.
Speaker 1:Yeah, to finish off, I hope I'm not putting you on the spot by asking you this question. What's your thoughts on Australian residential real estate? And you know where we are at with technology? Like is the general consensus you know in the US that you know Australia. Are we advanced? Are we mediocre? Are we way behind? Are we not keeping up? Is there any sort of opinion on our market that you'd be confident in sharing with me? You can be as honest as you like.
Speaker 2:Yeah, I mean I would say I'm a little more familiar with, kind of like, the larger real estate than a lot of the individual residential markets. But I will say, from a technology perspective, australia is a little behind. It's not to say everybody's behind, but I think, just if you look at the market in general, if you look at the adoption over time, there's a lot of things that just come to Australia later than and that's not to say there isn't willingness to adopt, but there's just a lot of companies that are based outside of Australia who make a decision not to do business yet in outside markets, whether that's the US or another market. I will say the Australian attitude is obviously very much gung-ho.
Speaker 2:I think my experience in working with Westfield and I have a lot of, you know, great, great friends now as a result and but you know, I think coming in it was like hey, we're the U S, we're this big, you know big country, and I was like man, this is a this, this, this 20 million, this country, 20 million people like they're as cocky as we are and and and I say that like in a great way I think there was always like hey, just because we're smaller doesn't mean we can't do what you guys do, and I think you know. So I think that that attitude certainly like that kind of can do we don't care what size we are, like we're you know, we're we're gonna, we can be as innovative as we want to. I think that's you know. I think that kind of you know seeps through the culture, so to speak, and so I think it's less about sometimes, it's less about, like, willingness to adopt and just more about what's available in the country specific.
Speaker 1:Yeah, yeah, absolutely. That's wonderful, I agree. I think that we I think there's a small percentage, a very small percentage of people that are moving very, very quickly, and I guess it just comes with age, and there's a few oldies that probably need to get out of the industry if they're not willing to adopt things. I always say that if you stand still in your business, you might as well go backwards, because the industry in general is moving at such a fast pace. You just can't afford to stay still. You have to make little improvements every year, and that goes for everything. That goes with your prop tech, it goes with your marketing, it goes with your personal development. You do have to keep on pushing forward and staying up to date, even if it's not as much or as fast as everybody else. You still just have to do that 1% on a regular basis to not fall too far behind, because it's going to be way too hard to catch up if you do that.
Speaker 2:Correct. Yeah, as you said, it's about consistency and it doesn't have to be massive, massive things, it's just being consistent over time. It's just little incremental changes. Time, it's just a little incremental changes.
Speaker 1:Amazing. Thank you so much for joining us. So lovely to have a different aspect to our PropTech in our space and I really really appreciate your time.
Speaker 2:Yeah, likewise Thanks, Ashley. Thanks for having me Appreciate it.