HI HEUTE Exclusive interview with Richard Gerritsen, senior director for Europe at Yardi.
At EXPO REAL, HI HEUTE chief editor Thorsten Müller spoke with Richard Gerritsen, senior director at Yardi, about the latest trends, in-house developments and the impact of recent global events.
HI HEUTE: In the past few years alone, the world has gone through major events – what would you say has changed for you within the real estate industry during this time?
Richard Gerritsen: The main change we’ve noticed is landlords and operators moving away from long contracts – the past couple of years has shown that you can’t predict the future. Yes, you can prepare and have a strategy in place, but clients don’t want to commit to a long-term contract anymore – people want flexibility.
Now we’re seeing the evolution of real estate and we’ve begun talking about the “Building of the Future” – what will that look like? In the past, traditional real estate has been made up of commercial, residential, industrial etc – but now buildings can include different types of prospects, tenants, agreements and lease contracts. A building where you have a shared space together with commercial offices, coworking, residential and retail space.
Technology is always evolving – we use smart devices in our own homes to listen to music, check the weather, change the heating or control our lighting – but within real estate, we can be hesitant to adapt and utilise technology.
It can be daunting to adapt or overhaul your operating model to better harness data, but with the push to online, you need to have a flexible environment that is easily scalable. Platform solutions are continuously evolving to meet the demand of the market, which is vital for facilitating growth and communication between asset owners and investors.
HI HEUTE: How has the real estate industry, especially the companies that deal with retail, developed with regard to digitalisation issues? Has it become significantly easier for a software provider like you or does it remain rather difficult?
Richard Gerritsen: We recently conducted a survey with EPRA about the adoption of proptech in European listed real estate and the results were interesting. 20 years ago, technology innovation was seen as an IT topic that had to be dealt with by an IT manager rather than the person responsible for the business strategy. Whereas now, 68% of respondents strongly classified technology as a business topic, so businesses today are realising technology is required to run their business better.
Proptech adoption is not about the selection of a feature-driven tool. Proptech adoption is a strategic business decision that drives the future of an organisation. It is about changing how an entire organisation operates. Investing in technology is fundamental, but businesses need to be prepared to undergo this process before they can get to the other side of innovation.
However, 46% of businesses do not consider proptech adoption as a high priority compared to other business initiatives.
So, there is a positive change occurring where businesses are seeing the potential of digitalisation, but some are still hesitant to change due to their organisation’s inability to onboard further solutions.
Many organisations believe they are not ready to transition to the other side of technological innovation. This is an underlying issue that we need to change. We need to be asking – ‘what is my cost if I don’t invest?’. If you don’t ask this question, you begin to settle for tech initiatives being a low priority, which then makes it acceptable for organisations to not be ready for it. Questioning the ‘what if?’ becomes a natural evolution towards tech innovation.
HI HEUTE: What has changed in your work in terms of content? Are there new tools or other services that make you even more attractive as a company?
Richard Gerritsen: Yardi’s technology is always evolving and innovating and we consider the needs of our clients when updating our services. When we talk about Yardi and the real estate industry, it’s about you, not us. The technology offered is merely the facilitator, but proptech is about companies willing to change.
We have seen a few operators begin to move into flexible working and residential alongside their commercial offerings. Yardi’s technology is designed to scale with our clients. For example, Yardi Voyager provides a holistic view of their portfolios and our other solutions can be added to it, such as Yardi Investment & Accounting to help simplify complexities and provide better reporting or the RentCafe Suite to aid marketing properties, nurture prospects, sign leases and enhance communication and payments with a mobile app.
Yardi is a global company and we create technology to benefit the different markets across the globe. It isn’t a one size fits all solution; we provide the right solutions that will help our clients gain an end-to-end platform for a frictionless experience for both staff and tenants.
HI HEUTE: You have now been active on the German market for almost a decade. Are you satisfied with the overall development, or do you still see a lot of potential for the future?
Richard Gerritsen: We are continuing to see product adoption growth as more companies in Germany realise that digitalisation should be a strategic business decision, as proven during the EPRA survey.
As a result of the real estate industry understanding the benefits of end-to-end solutions that are intentionally created for real estate, such as Yardi’s, the industry is transitioning into cloud technology adoption. In our recent study with EPRA, 60% of the respondents stated that technology has had a strong impact on company performance over the last 5 years.
Furthermore, we need to start thinking about how we manage not only traditional asset classes but also mixed-use portfolios. Organisations will begin navigating the challenges of new markets, which is an area of great growth and opportunity for property technology.
The German market needs to start asking, what is my cost if I don’t invest? – but with the industry changing, it’s no longer what if, but when. Better technology results in better data which enhances operational performance and then helps you achieve ESG targets and helps streamline business processes.
HI HEUTE: What role does ESG play for Yardi?
Richard Gerritsen: So, when people talk about ESG, they focus on the environmental side – but ESG stands for Environmental, Social and Governance.
At Yardi, we pride ourselves on our commitment to our customers and employees, giving back to communities and continuing to invest in innovation.
In 2022, we have donated to help the Nature Conservancy of Canada (NCC) protect and care for the largest private conservation project in the country’s history – the Boreal Wildlands project in northern Ontario.
We contributed $1 million to the relief efforts of non-profit humanitarian aid organisations, including UNICEF, the Romanian Red Cross, Direct Relief, ShelterBox and more which work to assist and support Ukrainian nationals displaced by the war between Russia and Ukraine.
Throughout each team per region, we also help with our local communities and donate to non-profits, such as Flüsterpost e.V. in Germany, which supports children whose parents have been diagnosed with cancer.
Our corporate motto is, take care of our clients, take care of our employees, take care of our communities, stay focused and grow – this is more important than ever at the moment.
HI HEUTE: Due to the changing world of real estate, what are Yardi’s plans for 2023?
Richard Gerritsen: The building of the future is already beginning to happen – at a recent event we attended, they stated that real estate investors in 2021 invested 40% in office, 20% in industrial and 40% in retail. In 2022, it’s now 20% in retail, 30% in office and 30% in industrial with an increased demand for investment in residential.
As operators and investors change with the natural evolution of real estate, our strategy is to continue innovating and creating a platform that benefits all types of real estate offerings from investment, commercial and retail through to coworking and residential.
You can’t deny the demand from tenants as they wish for more flexibility and dynamic experiences and if operators don’t evolve with the industry, they’ll start to lose out to the competition.
HANDELSIMMOBILIEN HEUTE – Thorsten Müller, 13.10.2022 – Expo Real Interview “Kunden wollen noch mehr Flexibilität”