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Digitizing Transactions

The PTC

Created on September 9, 2024

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E-signature + documentation
Blockchain
Virtual tours
Sales
Digitizing transactions

The digitization of real estate transactions enhances efficiency, security, and convenience. Technologies like smart contracts, blockchain, virtual tours, and alternative lending platforms have the potential to streamline processes. Automated valuation services and big data analytics enable informed decisions, while regulatory and due diligence processes ensure compliance and trust.

Alternative lending platforms
Smart contracts
Leasing
Marketplaces
Increasing demand and interest

25x

97%

Financing
faster agreements through digital documentation
of homebuyers used the internet in their home search
Automated valuations
Fractional sales platforms

20.5%

$20 b

increase in Dubai resi transaction volume in Q1'24 compared to Q1'23
Real estate blockchain transaction value leading up to 2024
Regulatory + due diligence
E-signature + documentation
Blockchain
Virtual tours
Sales
Digitizing transactions

The digitization of real estate transactions enhances efficiency, security, and convenience. Technologies like smart contracts, blockchain, virtual tours, and alternative lending platforms have the potential to streamline processes. Automated valuation services and big data analytics enable informed decisions, while regulatory and due diligence processes ensure compliance and trust.

Alternative lending platforms
Smart contracts
Leasing
Marketplaces
Increasing demand and interest

25x

97%

Financing
faster agreements through digital documentation
of homebuyers used the internet in their home search
Big data + analytics
Fractional sales platforms

20.5%

$20 b

increase in Dubai resi transaction volume in Q1'24 compared to Q1'23
Real estate blockchain transaction value leading up to 2024
Regulatory + due diligence
Blockchain
Blockchain enables the tokenization of real estate, transforming properties into digital assets. These tokens can represent real-world assets and be divided into smaller pieces, making them accessible to more investors. This process enhances capital raising and ensures secure, compliant transactions, including issuance, trading, and lifecycle management.
Use cases

Asset management

Project financing

Loan and mortgage securitization

Land and property registries

Property management

Investor and tenant identity

Payments + leasing

Real-time accounting

Tokenization Process

Property address + description

Create ethereum token

register token on blockchain

Hash property data + store for rendering

registered Owner signs deed token

Automated Valuations

Key considerations

  • Data & coverage- Market coverage, standard coverage, depth of capture
  • Value estimation- Modesls employed, metrics utilised, value blednign approaches,
  • Confidence scoring- Feature based estimates, forecasted standard deviation
  • Accuracy- comparables to sales prices (Historic), comparables to market, median error %
  • Properties excluded- Mobile homes, homes on farm or argicultural land, Multi-unit / sub divided homes
  • Data security & access- Senstive data usage, security systems, data storage

AVM Components

Data collection + ingestion

- Data Collection: Gathering relevant property data from various sources (public records, platform listings) - Data Integration: Combining different sources's data into a unified dataset - Data Transformation: Structuring raw data and organising so suitable for analysis

Data cleaning + preprocessing

Feature selection + significance

Statistical models & algorithms

Data sources

- Public records- Sales histroy - Property listing - Market / area data - Property charactersitics / features

RAW DATA

AVM PROCESSING

APIs to external platforms

OUTPUT + USAGE

  • Home sales
  • Portfolio management
  • Investment analysis
  • Market analysis
  • Risk mitigation
  • Database enrichment

Typical AVM stages

MORE DETAILS

Leasing
Key stats

Decrease in Abu Dhabi rental contracts Q1'24

10.9%

Decline in Abu Dhabi contract renewals

15.5%

% of income spent on rent - Dubai

30%

Year-on-year rental growth - Dubai

21.2%
While Dubai's residential rental market has performed strongly for landlords, concerns remain for renters who face high rents + transaction costs and low vacancy rates
Smart contracts

Working as an application of blockchain, smart contracts are self-executing agreements with terms directly written into code. They automatically enforce ownership and terms when specific criteria are met, streamlining transactions and eliminating the need for third parties, thus enhancing security and efficiency in real estate.

30% reduction in transaction times

50% reduction in transaction costs

70% reduction in time taken for lease agreements

63% of real estate companies adopted or used smart contracts in 2023

Virtual Tours

Virtual tours for real estate are immersive, 3D experiences that allow potential buyers and renters to explore properties remotely. They provide detailed views and interactive features, enhancing the property search process by offering convenience, saving time, and expanding market reach without the need for physical visits.

9% more sales for homes with virtual tours

87% more views for homes with virtual tours

54% of buyers would not consider seeing a house if it doesn't include a virtual tour

Listings with virtual tours sold 31% quicker than those without

Fractional Sales Platforms
Key Benefits
Liquidity
Accessibility
Simple exit strategy
Diversification
How it works
Shares start as low as $50 and enable owners to receive fractional rental income
Users buy shares in a property through digital tokens on the blockchain
Financing

Key concerns

Homeownership rates have been declining over successive generations due to economic constraints, rising property prices, and stringent credit requirements. Additionally, demographic shifts like delayed marriage, increased diversity, and changing preferences among younger generations contribute to fewer young adults forming independent households and purchasing homes.

Top barriers to homeownership

37%

Cost of living

Inability to raise deposit

34%

29%

Insufficient income

Alternative Lending Platforms

These platforms provide alternative funding solutions for potential individuals seeking to invest in real estate. They make homeownership more accessible and are often more efficient and cost effective than traditional mortgages.

Equity release solutons

Details

Digital mortgage automation

Details

alternative options

Crowdfunding

Details

P2P Lending

Details

Marketplaces

3,000+

Number of real estate marketplaces worldwide serving a variety of use cases such as end-to-end sales, leasing, and short-term rental
Key market highlights

High quality photographs expedite sales 32% faster while video content generates 403% more inquiries

Only 17.3% of marketplaces offered virtual tours in 2023

38.7% of real estate marketplaces offered keyword searches

E-signature + Documentation
Paper-based documentation processes are time consuming, outdated, and are losing business to digital challengers.
Home TXN Use Cases
Buyer/seller agreements

127%

Seller's disclosure
increase in client satisfaction
Home appraisals
Inspections

$60,000

Offer agreements
in savings per year
Repair amendment riders
Contingency releases

50%

Promissory notes
Closing statements
reduction in paper costs
HR and Operations Use Cases
Commission split negotiations
Agent contracts
NDAs
Service fee negotiations
Regulatory + Due Diligence

Land registry globally is a very slow process. Using blockchain technology for digital land registry has the potential to significantly reduce costs and time taken.

13x

$106 M

reduction in time taken for the registration process
estimated annual savings for the Swedish government through blockchain-based land registry
How it works
Agent
External original document and blockchain storage
Bank
Existing database
Buyer
Land registry blockchain (open to public)
Seller
Benefits
  • Reduced duration
  • Higher security
  • Decentralized data management
  • Real time ownership tracking
  • Transparency
  • Lower transaction costs
Digital Sales

Digitizing real estate sales requires high amounts of initial investment but offers several key benefits throughout the sales process. There are several key techs that help achieve these benefits. These include but are not limited to blockchain, smart contracts, tokenization, and fractional ownership.

Key benefits

Increased customer engagement

Accurate appraisals

Risk reduction

Efficient marketing

Process optimisation

Faster decision making

73%

93%

of millennials are more likely to work with agents using latest tech
of real estate agents prefer pre-approved clients
Blockchain
Blockchain enables the tokenization of real estate, transforming properties into digital assets. These tokens can represent real-world assets and be divided into smaller pieces, making them accessible to more investors. This process enhances capital raising and ensures secure, compliant transactions, including issuance, trading, and lifecycle management.
Use cases

Asset management

Project financing

Loan and mortgage securitization

Land and property registries

Property management

Investor and tenant identity

Payments + leasing

Real-time accounting

Tokenization Process

Property address + description

Create ethereum token

register token on blockchain

Hash property data + store for rendering

registered Owner signs deed token

75%

LOCATION CONSIDERATIONS

Connectivity - carrier neutral

Proximity - infrastructure

Environment security

Promiximity - end user

Application of data (end-use)

Energy - access

Operating model & agreements

Regulations & incentives

of all enterprise generated data is expected to be created and processed outside traditional data centres driven by edge data centres
44%
higher electicity costs than the national average in San Jose, US, which has 27 colocation data centres

Energy - renewable availability

Connectivity - Access

Location & site planning are crucial considerations for effectiness
Trends & models in data centre locations
Edge data centres
data users & producers
Edge data centre
Tradional data centre
Distance
Colocation data centres
Corporates
Carriers
Private exchanges
Government
Colocation data centre

MORE DETAILS

Modular & mobile data centres
Rising demand for new data centers is also creating potential investment opportunities in the fragmented prefabrication and modular (PFM) sector. Demand for edge computing must be met from smaller data centers, often located in urban areas close to customers, rather than huge facilities in far-off locales. Types of pre-fab + modular solutions - Pre-fabricated strcutural components - Skid-mounted MEP equipemnt - Enclosed MEP modules - All in one modules
Examples
Schneider electric's mobile container data centre
Huawei's Smart Modular data centre
Each type of security consideration is applied to each security layer in a data centre facility
Types of security
  • Physical security
  • Network security
  • Data security
  • Operational security
  • Outside barrier
  • Security within premise
  • Server room access
  • Data / server level
Layers of security in Data centre site

Gates barriers, fences, cameras. Detect, Verify & deter

Tracking all movements on ground + in air, radar, security cameras

Speaker systems, key cards, smarts locks, access mgmt system

Modular cameras in racks, tracking who is accessing servers /performing maitenance

83%

of data breaches involve internal actors

Top 10

risk to globally stability - The world economic forum
Security & access management
Threats - according to industry operators

Randsomware

59%

Outside threats (human)

52%

Loss of personal IDs

43%

Advanced Persistent Threats (APTs)

43%

Insider threats (Human)

42%

Inadequate recovery plan

29%
While cyberthreats lead general security concerns, the human element often plays a large part of data breaches

MORE DETAILS

Security systems
Types of physical security hardware
1. Access Control Systems 2. Surveillance cameras 3. Environemntal monitoring systems 4. Intrusion detection systems 5. Physcial barriers
Examples
Cisco's Meraki security cameras leverage ML to offer features such as object detection, motion search, and real-time alerts
HID Mobile access solutions allow keyless entry leveraging underlying Seos credential technology.
Server racks
Server rack technology and layouts evolve with the potential for increased server densities. Data center leaders are seeking new solutions to accommodate higher density levels and more technology deployments.
Change in rack density survey - Past three years
Examples
Iceotope’s Precision Immersion Cooling racks - Immerse electronics to reduce energy usage
HPE Apollo 2000 Gen10 Plus rack - for high performance computing and big data analytics​
Location intelligence platforms
Use cases - location intelligence and data centers
Financial modeling
Site selection
Market intelligence
Site planning
Examples
MapLarge - Big data mapping software for location intelligence
DataCenterHawk - dedicated site selection platform for data centre's with forecasts
Steady improvement in Average power usage effectiveness (PUE) ratings
Data center electricity consumption % increase from 2015 to 2021.
Increase in workloads (2015-2021)
Increase in internet traffic (2015-2021)

260%

440%

Energy and water key drivers of sustainability concerns

Key sustainability concerns for data centres

The biggest concern for data centers is energy usage, as data centers consume huge amounts of energy. Concerns are related to inefficient use of energy, or non-renewable energy The second biggest sustainability concern, also centered around resource usage, is water consumption - and related processes such as water sourcing, water usage effectiveness, and water recycling.

By 2025, 3.2% of global carbon emissions are expected to come from data centers, while consuming a fifth of global electricity.

The average data center has a WUE of 1.8 L/kWh, meaning they use 1.8 liters of water for every kilowatt-hour of electricity.

MORE DETAILS

Cooling systems
Keeping the server room temperature between 20-22 degrees Celsius is essential for server reliability and performance. As computer components become faster and smaller, the heat they generate intensifies and becomes more concentrated. Cooling and ventilation are vital and account for up to 40% of the total energy consumption of a data center. Types of cooling: - Air based (Air conditioning, Air handlers) - Liquid based (Chilled, Direct-to-chip, Immersion) - Evaporative & Adiabatic - Heat exchangers (Air-to-air, Liquid-to-liquid) - Advanced (Thermal storage & free cooling)
Examples
Facebook's data center in Oregon utilises direct evaporative cooling that uses water vapour + outdoor air
Microsofts Project Natick - an underwater data centre for reduced cooling needs

1%

3.6%

2.8%

Half of all cloud data centers are predicted to deploy advanced robotics & artificial intelligence by 2025

Four primary use cases

Monitoring

Data centre security

AI/ML in cloud operations

Server upgrades & maintenance

50%
Manual labour efficiency optimisation and automation
High potential for human error in layout planning, poor training, lack of maintenance

75% of data centre outages = human error

Value of automation and robotics

85% of data centers that experienced outages from human error were due to staff not following process

30-40% energy cost savings by implementing AI energy optimization systems such as Google

30% improvement in operation efficiency by deploying robotics and AI in data centers

MORE DETAILS

Robotics & automation
AI-powered analytics is revolutionizing data centre operations. Various providers have presented significant upsides in operational efficiencies, reduced resource consumption and reduced costs.
41% of operators deploying robotics & autonomous sytems in the next 12-26 months
Examples
IBM Watson - can predict potential failures before they occur, allowing for proactive maintenance, reducing failure rates 30%
NTT Data conducts data center robot trial, will roll it out across Japan and commercialize offering (2022)
Data centre infrastructure management & virtualization

DCIM software provides the necessary link between the operational needs of the physical IT equipment and the physical facilities (building and environment controls). DCIM adoption from industry respondents: 69% - Security 65% - Temperature & humidity monitoring 61% - Facility management 61% - Power / energy management 60% - Asset tracking 57% - Cable management 51% - Change management planning 44% - KPI tracking 36% - Deep integration with virtualization

Examples
6SigmaDCX digital twin platform with DCIM applications
Sunbirds DCIM platform with visualization feature