Voices of Digital Transformation: Expert Insights Series

Paul Healy, Chief Executive Officer, Property Funds Association

Our expert insights series is based on outreach conducted by MRI Software for its national research report for the commercial property sector – Voices of Digital Transformation Report.

About the Property Funds Association

The Property Funds Association represents the unlisted wholesale and retail property funds sector in Australia, providing a broad range of advocacy services and ensuring that investors receive attractive risk-adjusted returns.

Paul Healy is the association’s CEO, and has over 40 years experience in the property industry, in both the UK and Australia. Paul started his career in valuations in London and has worked for many other leading real estate businesses, including JLL, Knight Frank and BlackRock.

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Navigating business challenges

“​​The Green Building Council of Australia has emphasised the pressing need for buildings to embrace environmentally friendly practices, and tenant preferences are increasingly favouring eco-friendly spaces,” Paul says.

While this poses a significant business challenge, he adds, many owners are just beginning to wake up to its importance, and are facing mounting pressure to align with sustainable standards – or risk being left behind.

Today, the focus is on constructing buildings that achieve green ratings of 4-5 stars, and in some unique cases, even 6 stars. The responsibility often falls on owners to ensure that the properties they offer are adhering to these standards.

– Paul Healey, Property Funds Association.

“How technology can contribute to establishing and enhancing these green credentials, and how we can use it to create greener buildings, remains an open question that demands attention.”

Implementing new solutions

Paul says that property funds management is all about providing a building that appeals to a tenant who pays the rent.

“The rent forms the distribution and the income that leads to the capital value. Values go up and down based on the rents derived or the capitalisation rate applied. While this may be a high-level approach, there’s generally a really simple equation at play.”

“Funds management companies need to ask which tech solutions are available to help them with providing this value and how solutions can assist with the asset management of the building,” he says.

How does the tech fit alongside facilities and property management? How should buildings be managed to optimise energy usage and what sort of equipment needs to go into buildings to ensure efficiencies with this?

– Paul Healey, Property Funds Association.

Managing change and measuring success

Paul says there’s a noticeable shift in recognising the importance of effective collaboration in managing industry change. “In the networks I engage with, there’s a shared desire for cooperation,” he says.

I sense a greater understanding that working together is essential, as opposed to sticking your head in the sand or adopting an indifferent stance. The minority may still choose not to engage, but the overall trend is towards cooperation and collaboration.

– Paul Healey, Property Funds Association.

“ESG presents one area where collaboration and collective decision-making are crucial,” Paul adds. “We need collectively consider what happens to buildings that can’t be upgraded to meet the highest standards. Do they face demolition, or can they be repurposed for an entirely different use?

Data privacy and security

“Everyone is concerned about being hacked, and the high profile cases that have been reported in the media are bringing cybersecurity to the forefront,” Paul said.

He emphasised the importance of having high-level expertise to help you deploy appropriate data privacy and cybersecurity controls.

“Boards and the executives need experts to guide them on these issues and help them to ensure that they’re following best practice, complying and being responsible.”

Lessons and best practices

“My advice is to embrace technology warmly and live with it. Work with it to enhance your outputs and to create the most value possible,” Paul says.

Proptech trends to watch

Paul believes that commercial property will undergo change in coming years, and that a significant percentage of this will be driven by ESG-related imperatives.

“Technologies that help asset managers come to terms with these changes and challenges will be the ones to watch,” he concludes.

Download a copy of the Voices of Digital Transformation Report here and learn more about how Australian real estate businesses are embracing proptech best practices to help achieve strategic goals.

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