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Podcast – Goodwin PropTech Series – Real Estate Innovation

Tyler Stewert
September 2, 2021
Podcast – Goodwin PropTech Series – Real Estate Innovation

With an increasing pace, real estate companies are adopting the latest technology into their practices. We sat down with Goodwin PropTech Partner Blake Liggio to find out what innovations are making the biggest impact, and what that means for you.

Blake Liggio is a partner in Goodwin’s Real Estate Industry group. Mr. Liggio focuses on mergers and acquisitions, including the representation of acquirors, targets, boards of directors, transaction committees and investment banks. He also advises clients on a range of corporate matters, including fiduciary duties, corporate governance, federal securities law disclosure and compliance, and defensive measures.

Mr. Liggio is also involved in Goodwin’s PropTech Initiative focused on the intersection of Real Estate and Technology through thoughtful collaboration across the two practice areas and advises on relevant market trends impacting the PropTech sector.


– Learn more about Goodwin’s PropTech practice by clicking here.

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RealCrowd – All opinions expressed by Adam, Tyler and podcast guests are solely their own opinions. And do not reflect the opinion of RealCrowd. This podcast is for informational purposes only and should not be relied upon as a basis for investment decisions. To gain a better understanding of the risks associated with commercial real estate investing, please consult your advisors.

Blake Leggio – If real estate can take control of how they’re going to utilize technology, it’s certainly preferable from a business standpoint than being forced to bring on new technology without being prepared.

Adam Hooper – Welcome again to our fourth episode of the Goodwin PropTech podcast series. Blake Liggio, partner at Goodwin’s PropTech practice group sat down with us to discuss the ever increasing pace of innovation and adoption at the confluence of real estate and technology. Blake shares his thoughts on why the pace of adoption is quickening and what operating companies can do to ensure successful integrations when exploring new technology solutions. For more information and to stay up to date on future episodes, go to If you have any comments, feedback or questions, please send us a note to Enjoy the episode. All right Blake, well thanks for joining us again today for another episode of the Goodwin PropTech Series. What’s been going on since we last spoke? What’s new in the PropTech world?

Blake Leggio – Things are moving at a very rapid pace. I’d say that we’re primarily seeing an increase in consolidation of many of the tech assets which is a topic of one of the prior sessions. We also saw last week that it was reported that WeWork had confidentially filed for an initial public offering which is a huge move. That’s going to provide a big disruptor in the space with additional access to the public markets which will put more pressure on real estate to continue to evolve from a technological standpoint. A lot of exit, I would say the increase that we’re primarily focused on and seeing certainly is more significant exit. Exit transactions both in MMA and in the capital markets.

Adam Hooper – Now it seems like we’ve had a fairly cool period for IPO’s in the technology space. We’re starting to see some more warming up. Certainly in the real estate space, I don’t think they’re been many that have gone the IPO route. Are you starting to see some shifts within the PropTech and real estate space? Do you think this will kick off more companies looking to go public?

Blake Leggio – Yeah that’s a good question. I’m very interested to see that registration statement pop up when it does become public. Because the first thing I’d like to look at is what they’re classified as. You’re absolutely right that the capital markets have been virtually non-existent on the real estate side. I suspect, I mean this is a hybrid company right? Most people view it as a real estate operator. You know marketing in an IPO is crucial and it’ll interesting to see what they come out as in terms of whether they’re classified as tech. Regardless of how they kind of technically view that, certainly when they get out on a road show, they’re going to be looking at, you know they’re always going to have a traction from both the real estate side and tech. In terms of the activity on the tech side in the public markets, we’ve been seeing an increase in those deals over the last 18 months or so. I would say that the activity on that in the tech industry has been solid. It’s continuing into 2019.

Adam Hooper – It will be interesting. Obviously, tech companies trade at a much higher multiple than real estate companies so that positioning is going to be pretty interesting. There’s a lot of companies in our space and in the PropTech world that are trying to figure out again how do you classify yourself? Are you a real estate company that’s leveraging technology? Or are you fundamentally a technology company operating in the real estate space? That’s going to be interesting to see how that plays out.

Blake Leggio – I completely agree. It might not matter for these business because they’re really sort of hybrid models. It may not and they certainly have the brand name in the case of a WeWork. You might just have investor pull regardless of how they ultimately come out from a technical standpoint on the classification of industry.

Adam Hooper – Then anything on the operator side, the asset manager side? Any new technology that you guys are seeing since we last caught up about any new innovations or adoption new technologies that you’re seeing out there?

Blake Leggio – On that piece that the space has somewhat stabilized. We have now a view of what of the various segments of PropTech assess that are available. That will continue to evolve. The focus on traditional real estate sectors that really were struggling like brokerage and traditional investing in real estate, retail office, leasing, all of those things. The technology side has figured out the approach in terms of the type of technologies available to disrupt those real estate sectors. I think that for the most part, the various technology assets types have stabilized at this point.

Adam Hooper – Okay, well now you mentioned a moment ago kind of pace of innovation and that was what this piece was about was how the pace of innovation and adoption has really started to ramp up lately. Why don’t you take us a little bit about how has the industry historically adopted these? We talked about that a little bit before. But would have been some of those challenges to adoption? What do you think these triggers are that have kind of kicked off this quickening in the pace of new technologies in the PropTech space?

Blake Leggio – Sure. Real estate just as a general background has been slow to, you know most other industries have really focused on technological innovation. Certainly over the last 10 years or so. And real estate has been the last industry to really embrace the technological revolution that we’re seeing generally. Mostly through initial disruption, this was never something that was brought on by the real estate companies. The technology side, as the world is changing in terms of the new technologies available everyday that the technology side really brought this disruption to real estate. Now, we’re seeing this attitude of sort of on the real state side of self disrupt or be disrupted. That’s really the change because if real estate can take control of how they’re going to utilize technology. It’s certainly preferable from a business standpoint than being forced to bring on new technology without being prepared. That’s the general shift that we’ve seen certainly over the last couple of years. That has manifested in terms of as we discussed before, internal leadership, sort of internal resources that are being devoted within real estate companies to utilizing, researching, adopting and continuing to bring on new technologies into the business.

Adam Hooper – We talk about that in a prior episode right? The nature of those roles, those technology roles within the companies are kind of allowing this pace of change to quicken. Allowing for new technologies to be explored. How do we see that playing into this pace shift of kind of these new leaders that are more comfortable with technology coming into positions where they can make some of those decisions?

Blake Leggio – One of the biggest hurdles as we started looking at this space was integration. First of all, this is not new necessarily. Technology is not a new thing in the last 10 years to real estate. We saw an initial phase of this in the dot com era in the 90s into the 2000s. Some real estate operators at that time tried to embrace and integrate technology and it wasn’t necessarily a successful endeavor. There are as we have also discussed in prior episodes some head wins here on the side of real estate. But regardless of that, that has contributed to some reluctance I think to view this as a space that there is really a desire on the real estate side to create internal infrastructures that are focused on integration. But integration itself has always been kind of the biggest issue. Because technology companies really do not necessarily understand how real estate operates. It’s a very different, completely different industry tech and real estate. And the biggest piece that’s driven I think the acceleration recently is as you said the creation of kind of internal leadership that it’s focused on this and understands obviously how the real estate side, what it needs to integrate technology and how to make that successful. That’s been a key piece that is slowly being deconstructed on the real estate side.

Adam Hooper – I know real estate has always been somewhat of a if it ain’t broke, don’t break it kind of a mentality. For companies that are out there that have had success without technology, without integrating some of these new tools. What’s going to drive them to adopt technology now if they’ve already become so successful without it?

Blake Leggio – Right. That’s the key question that I think real estate operators are thinking about. The answer to that question is more about the general direction of our world today and more about the technologies. There’s only so long that you can kind of continue to put off implementation of technology just because it’s such a solid space and it’s continuing. There’s new technologies every day that are being utilized by people who are also using real estate. You see customers that are involved in real estate who are coming to expect the integration of technology as they use real estate as well. Qhile real estate maybe is a relatively simple business model, there’s just only so long that it can hold off kind of being isolated from a technological standpoint. Rhat’s a big piece of what we’re seeing happening now.

Adam Hooper – Do you feel that this pace, is it going to just gradually continue to increase? Or are we going to reach a tipping point where all of a sudden that mentality is just going to shift? Then it’s going to be a race to integrate as many technologies as possible. Is it going to continue to be kind of just a quickening adoption but it’s not going to be a very clear changeover as 2019 was the year and now everybody’s going to be integrating these different technologies?

Blake Leggio – We’re already in what you’re describing. It’s going to be one inflection point. If I even think back to a year ago when we launched this practice area. You’re already seeing when we go to real estate industry events. We’re already seeing the discussions around technology change. It’s no longer oh we’re not going to talk about this. It’s we’re talking about this, it’s important. It’s just a a matter of time before we’re working on the real estate side to figure out how to get our arms around this. We’re already in that phase where real estate, where many if not most of all the traditional operators and REITs are in the process of adopting technology. I think there’s only a few at this point that I can identify who are continuing to kind of put their arms out and resist what’s going on.

Adam Hooper – Adoption is obviously driven by value and value creation. What are some of the either hidden values or increase in certain efficiencies? What are the value propositions that real estate companies are getting from looking at these new technologies?

Blake Leggio – That’s going to be a more long term proposition because I don’t necessarily think that we’re in a place where you could ask a real estate operator. In the event that you’ve adopted technology, is it now automatically, immediately impacting your bottom line? It’s going to to take some time. As we’ve also discussed before, many of these real estate operators are utilizing these technologies as select assets rather than across the portfolio. Until there’s an integration of the technology across the business. That may be the point where you’re saying okay, this is impacting NOI at a more across the board basis. That’s ultimately where we see this going.

Adam Hooper – Great and again we’ve talked a little bit before but maybe just a quick refresher on how companies can position themselves to maybe look forward to see that value. Or what is a typical rollout look. Like you said, maybe tried a couple assets, maybe see some efficiencies and then you really lean into kind of a platform wide integration.

Blake Leggio – That selective integration has been one of the approaches that we’ve seen. Again, internal leadership and bringing on management level people who understand technology is another trend that we’re seeing Is certainly crucial on the integration side. There are also a number of PropTech industry events that are happening all the time. Sending people who are operating the business to those events where you can learn about these technologies and what they’re doing and what they’re capable of. And then make internal judgements as to whether it makes sense to approach or to think about integrating whatever variety of technology would make sense for your business is another strategy that we’re seeing. Just bringing the tech and the real estate sides together in the same room to figure out what makes sense from an adoption standpoint.

Adam Hooper – Again like you said it’s interesting right? Because a lot of the real estate practitioners don’t necessarily understand at a deep technical level how some of these tools might apply to their business. If it gets a little bit too into the weeds in terms of the technological side of things, we’ve seen a lot of glazed eyeballs. Similarly, as you mentioned before on the technology side, real estate is such a unique asset class compared to other more kind of consumer markets that most technology providers are used to dealing with. How do you see that gap being bridged? Is it focus groups? Is it making sure that the founding teams have expertise on both sides? Is it just kind of product expiration? How do we cross that bridge basically between these two very different mentalities of technology and real estate?

Blake Leggio – It’s all relating to what we’ve talked about so far. I certainly think we are, as we’re gaining more clients in this space, we’re seeing efforts from both the real estate side and the tech side to come together. Because I think you’re absolutely right that there’s just a lack of understanding. Certainly on the real estate side of these technologies. Anytime you get a tech person talking about the technologies, even somebody who’s kind of up to speed about technologies, can sometimes get lost. Then you have an older generation of leadership in real estate and there is a little bit, a lot of it sails right over people’s heads. Getting everybody in the same room and I think the technology companies have learned how to speak in more plain English about some of the capabilities of these assets and that has been key. There have been significant strides on the tech side made to make this more simple. They’re getting to know their audience better in the real estate end user.

Adam Hooper – As we look forward, you know we’re in this transition period. We’re seeing this pace pick up and we’re seeing more adoptions. What are some of those bright spots that you’re seeing in terms of maybe some low hanging fruit. Maybe some areas that you think you’re going to have a bigger impact than maybe early early participants would understand right now as we look forward here next two or three years?

Blake Leggio – That piece has stabilized. I’m sure there will be the emergence of new segments and technologies over time that will be novel. But I think that the main activity is coming on the brokerage space, retail office. There’s good traction in industrial with given the strength of that asset class in real estate. Then of course leasing with coworking and the strength of that PropTech segment.

Adam Hooper – Before we wrap it up in terms of what’s next from Goodwin. Maybe just a quick reminder on some of the kind of keys to a successful technology option once an operator has kind of bit the bullet and they’re ready to go in and adopt some of this technology and get out there. What are just some last kind of keys that they can keep in mind to make that successful?

Blake Leggio – It’s about communication. It’s both about staying up to speed on the latest innovations in the industry and then internal leadership. You need to have people in house there everyday in management roles who are in charge of the business and understand the direction of the business. Who are also very focused on keeping up with the technologies in real estate leadership roles in order to make successful integration happen.

Adam Hooper – Perfect, and now we were talking a little bit before we started recording. What can we see next from Goodwin in the PropTech Series?

Blake Leggio – We’ve been getting, again as we gain clients in the space, we’ve been getting now some more specific requests. Now, the biggest demand that we’re seeing is how these partnerships between tech are, you know what they look like from a documentation perspective. How revenue is being shared, what are the potential implications from a tax standpoint for real estate operators, specifically REITs. Where we’re going to, and we’re excited about this, is take the series to a more specific kind of legal client driven request level with some data about what we’re doing for clients. Hopefully make some of these partnerships easier to envision and easier to understand certainly on the real estate side.

Adam Hooper – Perfect and you know real world case studies are always the best that we can learn from. It’s a very dynamic time out there and with you all at the forefront, we’re excited to help tell that story.

Blake Leggio – Absolutely.

Adam Hooper – Perfect well Blake thanks for joining us again today. Why don’t you remind listeners where they can learn more about the Goodwin PropTech Series.

Blake Leggio – We have a great link on our website to our PropTech practice and that has an aggregation of all the work that we’ve done in the space and is a great resource. That’s the first place to go.

Adam Hooper – We’ll have that down in the show notes for all the listeners. With that Blake, we appreciate your time and we look forward to the next episode.

Blake Leggio – Likewise, thank you very much.

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