Family Offices Brace For The Proptech Revolution
Oct 2. 2019 The real estate investment experience could be transformed beyond recognition as technology startups invade the notoriously opaque and inefficient industry. Family offices and institutional investors could expect greater liquidity, cheaper transactions and better property management as tech-savvy startups gain traction.
Startups in the commercial real estate space raised $10 billion in funding last year, and have raised $4.5 billion in the first quarter of 2019 alone, according to data published by CREtech. The industry has expanded so rapidly that several startups have already reached unicorn status (valuations over $1 billion).
WeWork and Airbnb, arguably the most well-known proptech companies, are already worth several times that amount. Lesser known startups such as Compass and Open Door have also crossed this billion-dollar threshold recently. Next in line could be Manhattan-based Cadre, which hopes to make the commercial property sector more liquid and transparent by supporting institutional investments decisions with comprehensive data.
The platform collects and monitors data from over 500 real estate assets and approves less than 2% of them based on a proprietary analytics framework for instant access on the platform. This streamlines the process of investing in hotels, multifamily residential complexes and office units.
Cadre’s founder and CEO, Ryan Williams, has already raised $133 million to date for the firm from over 80 investors including Jared Kushner, Mark Cuban and Peter Thiel. The company was most recently valued at $800 million.
Williams claims that over 800 family offices already use the platform to make data-driven property investment decisions and portfolio allocations. He says evaluating which investments to participate in can be challenging and available commercial real estate deals can often sell out very quickly. “One of our strongest family office relationships commented on this to us a few years ago and helped incubate our managed portfolio product, which provides guaranteed allocation into a portfolio of Cadre assets.”
The platform has already facilitated over $2.5 billion In Owned Transaction Value from accredited investors and institutional investors across the country. “We believe the platforms that focus on curation and quality control and play the long-game will earn the trust of valuable partners — both institutional owners of real estate as well as distribution partners,” says Williams.