Big Data has become one of the pivotal trends at the intersection of the real estate and proptech worlds. As the industry seeks to build and manage more responsive and more efficient assets, information about future and current users is key. In theory, the more data that can be collected, the more data-driven decisions can be made. However, the property world has quickly run into problems of sorting, managing and applying data points, as it seeks to find the sweet spot in the role played by tech and the people tasked with drawing conclusions from it.
“People are obsessed with capturing data, but often do it without purpose,” affirms Gabriel Damant-Sirois, co-founder of Montreal-based proptech Local Logic. “It’s important to remember that the ultimate value of data is creating value.”
Local Logic is a proptech firm operating in the US and Canada, which has set itself the challenge of combining urban planning, data science and AI to change how real estate decisions are made. “We started with a focus on understanding ‘location’, with up to 18 specific scores for every location within the US and Canada, then we set out to build tools which are currently providing insights to millions of users a month,” Damant-Sirois explains.
Like any valuable tool, data has to be handled with care, Damant-Sirois says. “If you collect data without purpose, it can be dangerous for the industry. It can generate mistrust from the public, about how sensitive information is handled. There are also legislative issues, such as GDPR in the EU, which can jeopardise the value of a product.”
Damant-Sirois, who has a background in statistics and urban planning, started out as a researcher and project manager across areas such as active transportation, accessibility measurements, and understanding behavioural choices when it comes to homes and land use. A spell at the Quebec transportation ministry saw him consult on traffic modelling in urban environments. All these experiences served to inspire Damant-Sirois and his co-founders to build a vision for Local Logic, which supplies the real estate world and potential house-buyers with extensive and sometime atypical information sets about locations to inform decision making.
“We are very location focused,” he affirms. “Real estate is an asset which is embedded in a hyper-local reality. We look at all aspects of the property ecosystem, including transport, amenities, noise, green spaces, to drive into very specific requirements.
“Local Logic serves two main use cases in the commercial arena. Real estate developers often already have an investment thesis, but are looking for a site to acquire. Others have bought a piece of land, and are not sure yet what they will do with it.
‘We help find hidden opportunities, particularly for those who are looking for a site. For those who already have an asset, the platform saves a lot of time, by aggregating all the data you might need.”
Potential house-buyers can also benefit from the platform, which has today been integrated into many successful third-party property portals. “We saw that search traffic already existed on house-buying portals, so instead of building our own platform, we decided to we sell our products to major brands such as Remax, Sotheby’s and Century21, swivelling to a B2B model. In the past, a home seeker would only have price and asset parameters. Our product allows users to add all kinds of criteria, from quiet streets to proximity to a school or subway station. Students and young people might care more about nightlife, while young families are looking for day-care and educational assets. Our lifestyle score also weighs in factors such as how historic a neighbourhood is, or access to restaurants, popular coffee bars or good green spaces.”
The Local Logic platform also fits into a growing sub-section of proptech tools which harness artificial intelligence (AI), not only learning from the data but improving on it as time passes. “We’ve essentially developed vertical AI software,” Damant-Sirois explains. “We are using AI to touch as many aspects of real estate as possible, from developing land to buying a house. We leverage alternative data sets to expose the supply side and demand side of the market at a hyper-local level. Ultimately, we are a bunch of urban planners turned data scientists. We realised that data science could inform decision making today, but also predict the future.”
While North America is a big and complex market to tackle, the firm is starting to look at expansion across Asia and Europe. “We started networking in London last year and there was interest,” he says. “We’re building our tech so it can scale rapidly in new geographies. But there are still lots of opportunities in Canada and the US for us to follow up.”
Overall, Local Logic is part of a bigger movement which is placing human choices and lifestyle aspirations at the heart of the machine. But Damant-Sirois still thinks that change will still come at a fairly leisurely pace. “The proptech space is very interesting at the moment,” he notes. “We’ve seen AI and big data increasingly have an impact. But in comparison to its impact on other industries, tech in the property space won’t be as fast to disrupt CRE. It will disrupt how decisions are made and assets managed, but the built environment doesn’t move as fast – it’s concrete and long-term in scope. We believe in the use of these tools as decisions that are taken today will have a long-lasting impact for generations to come- and that’s really exciting!”