With increased innovations, the government’s focus in driving commercial real estate growth as well as the development of the startup ecosystem, the proptech in Canada is sure to grow.
Interestingly, Canada is considerably larger than the U.S., in sheer landmass, but has about one tenth the human population, some 31,000,000, creating some interesting challenges in animal protection. Due to this size, sparse population compared to size (that includes a lot of immigrants) and its climate, Canada is home to a diverse landscape. It’s major land territories are covered by forest, tundra and the Rocky Mountains but houses a population of over 37.1 million. This being said, Canada is highly urbanized with more than 82% of its population residing in large and medium cities of here (mostly along the southern border) like the capital Ottawa, Vancouver, Toronto and Montreal.
The developed country of Canada is one of the most multicultural and ethnically diverse nations of the world and boasts of a large immigrant population. Due to the abundant availability of natural resources, and its large trade networks, Canada has an advanced economy, with a nominal GDP of more than $327,967 million. Canada’s largely rural economy from the 20th century was transformed into a highly urban one due to the rapid growth of manufacturing, mining and service sectors, and is also one of the worlds leading trading nations.
This quick introduction to Canada and its economy helps us set the scope to understand the technology, innovation of here as well as the opportunities for proptech in Canada. It is widely known that Canada is home to a number of headquarters of global technology firms, as it provides a scale of a global city and amenities of a tech hub. With this reputation, Canada is one of the leading countries that are innovating for technology in real estate, or as it is popularly known — proptech. Let’s first understand the role of Canada as a technology hub to then understand the proptech here.
Canada as a technology hub
Thanks to its diversified and technologically advanced economy, it is no surprise that Canada is home to many startups and tech companies. And not just start-ups, Canada also attracts attention and interest from leading tech companies of the world. For instance, Uber started its plans for building a state of the art research facility for driverless cars, in the heart of Toronto. Google too has move ahead with building smart high-tech neighborhood here.
As for local innovation, Canada’s three-unicorn tech startups- Slack, Hootsuite, and Avigilon- are headquartered from Vancouver. Both Vancouver and Toronto are evolving to become the next tech hub, and Montreal is not far behind enticing people with its tax incentives. It is also interesting to note here that Canada has one of the highest levels of internet access in the world. This sets the floor for increased innovations in proptech in Canada, propelling its proptech market.
Real Estate in Canada and its impact on prop tech
The increased employment in the technology sector (as an effort of top firms to attract the best talent), as well as the development of the startup ecosystem in Canada, has propelled it real estate growth, especially in leasing. As per Savyagency, Canada’s nearly 700 cleantech companies employ upwards of 41,000 people and generate $11.3 billion annually. The commercial real estate market is thriving here in the metros, and the increased attracting of talent has also propelled the residential market.
Also, government initiatives boost startups. For example, the Scientific Research and Experimental Development Tax Credit offers refunds of up to 65% of Research and Development (R&D) costs. This R&D credit, available to any company that develops a new product or service, helps offset the financial uncertainty that often slows innovation. The high quality of life and preference for city life by working Millennial is driving major crowds and corporates to the city. The home prices have skyrocketed, and the market is only set to grow more. Combine this with innovations in technology, and you have the ideal setting for the growth of proptech in Canada. Let’s understand the proptech sector of Canada now.
According to PwC, proptech, broadly defined as technology used in the real estate market, was a US$4.6 billion industry in Canada and the U.S. in 2016. Last year, that figure climbed to US$7.3 billion, an indication that interest and opportunity in the space has also grown. Using Big Data analytics, and other such technologies, companies are changing the way people buy homes in Canada.
An early bird and popular one in this segment is Zoocasa, an online neighbourhood search based online brokerage platform. Another interesting player in the proptech space of Canada is Casalova, Canada’s first end-to-end real estate rental platform. The platform allows for users to search for listings, book viewings and pay rent- all online. They have recently ventured into the buying and selling market too.
The innovations in proptech in Canada are also pushing brokers and agents to be more accountable. A platform like FeeDuck asks home sellers for details about their homes and agents then bid for the listing over 24 hours. FeeDuck then makes an e-introduction between a seller and lowest bidding agent, completely changing how the real estate selling worked earlier. Another startup doing similar work like FeeDuck is TrueBidz, based out of Toronto.
There is also some research and innovation happening in the proptech market of her with startups like ReInvent Realty, that merges Big Data with Local real estate listings. There are also the data intelligence tools for real estate agents- Opus44
This being said, we are yet to see companies utilizing tools like 3D printing, artificial intelligence (AI) and virtual reality (VR) in a big way to solve problems of proptech in Canada. Robotics and Drones are still far away.
Some of the top players in the proptech segment are:
BuildDirect Home Marketplace is an online marketplace that offers buyers a wide selection of products at the best value, direct-to-home shipping, free virtual design tools and best-in-class customer service. Sellers are able to leverage the marketplace to showcase and sell their home improvement products directly to consumers, helping homeowners get a simple and more trusted online shopping experience.
Breather is an app and the leading provider of space-as-a-service, with a growing network of private workspaces built for productivity. The company enables businesses to access flexible workspace by the hour, day or month. Founded by CEO Julien Smith in 2012, the company has grown to include hundreds of locations in 10 major across the globe including New York, San Francisco, Los Angeles and London.
Every space is designed to be comfortable, private and productive, with plug-and-play technology that ensures you can get to work as soon as you arrive. No matter how much space you need or for how long you need it, Breather provides flexible workspace solutions without lengthy turnarounds or leases that lock you in, leaving you space to concentrate on what’s next.
NexusCrowd is the first investment platform in Canada to harness the power of the crowd to offer investors the opportunity to co-invest alongside venture capital and private equity partners on the same terms. It partners with institutions to provide accredited investors with access to exclusive private investment opportunities that have reached at least 50% of the funding target. Every investment opportunity on the platform is sourced, vetted, structured, reported on and managed by institutional partners, giving investors access to institutionally led and managed investments across all sectors, stages and securities.
Joist is a new tool for contractors that allows you to estimate, invoice, record payments, and manage projects from your iPhone/iPad and the web. It Includes your company logo for professional estimates and invoices. Provision to build a list of commonly used items to quickly create estimates and invoices, calculate estimates fast, etc.
DIRTT — Doing It Right This Time — creates customizable, sustainable architectural interiors. DIRTT’s core is a set of robust interface elements that support reconfiguration, extreme levels of customization, and distributed manufacturing. DIRTT’s solutions include DIRTT Walls, DIRTT Millwork, DIRTT Power and DIRTT Networks, along with cutting-edge ICE technology, and ICEberg, a powerful modular vs. traditional construction cost-comparison tool.
Way ahead for proptech in Canada
With increased innovations, the government’s focus in driving commercial real estate growth as well as the development of the startup ecosystem, the proptech in Canada is sure to grow. It is not a nascent market but one that is future looking and is continuously advancing to stay ahead of times. For proptech in Canada, it is a good time as Canada’s policy propel growth in this sector and promote innovation. We can expect some unicorns in the proptech space from Canada in times to come.