Proptech: Hacking the property scene with data

Saturday 20 Apr 2024

This article first appeared in Digital Edge, The Edge Malaysia Weekly on September 27, 2021 - October 3, 2021

Joanne Kua, CEO of KSK Group and managing director of KSK Land, has spent a lot of time thinking about how she can use data to hack the property development industry.

She was interested in smart buildings and, coming from a company with roots in the insurance business, she knew the importance of data.

“I’m very interested in using technology to make data-driven decisions. Sometimes, this kind of data is not easily available in the property industry. Or if it is, it is typically used in a very traditional way and nobody really looks at it from a different perspective,” says Kua.

KSK Group was established in 1991 with a vision of becoming the country’s largest general insurer. In 2017, it launched insurtech start-up Sunday, which uses data models to offer insurance products, in Thailand. The company ventured into property development through KSK Land in 2013.

“If I can build artificial intelligence (AI) pricing models for insurance, why can’t I do that for property?”

This question led her to establish KSK City Labs in August, which is the tech and data arm for KSK Land. The company also announced that it would be the first in Malaysia to use Delve, a software that employs AI and generative design to help developers build neighbourhoods faster with less risk.

Delve is developed by Sidewalk Labs, a New York-based urban innovation company and subsidiary of Alphabet Inc.

The focus on data and technology keeps KSK Land aligned with the property technology (proptech) trend, where technology is used to disrupt the process of buying, selling, renting, managing and constructing buildings and planning developments.

One of Kua’s key objectives is to provide more personalised services. The plan is to take customers’ preferences into consideration from the design stage, and for each unit to be priced according to its unique features.

“Everyone who walks through the door comes from different walks of life and, yet, we are treating them [the same] by pushing similar products and developments. But this doesn’t work in today’s world,” says Kua.

KSK City Labs’ data scientists are currently developing an AI pricing engine for developments that could, ideally, customise properties at the unit level. “For instance, can a residential unit differ from another, even within the same development? How would we price it correctly for every customer?” she says.

The technology to build customised units for an entire development is there, although it is very costly now. As global trends are moving in this direction, however, Kua is confident that the company’s venture into data and technology is timely.

“To a certain extent, we can already customise the façade of buildings. For instance, if you like the sunlight, you can choose to have a balcony over a balconette. We can do that upfront at the design stage,” says Kua.

This is where a software such as Delve comes in handy. It uses many data sources and takes into account various factors to generate a range of designs for architects, planners, developers and other stakeholders to choose from.

“This leaves us with more time to have deeper discussions with architects and urban planners about what the customer actually wants. This is a conversation oftentimes set aside in the traditional way of doing things. It is only thought of after the development has been built and is in the marketing phase,” says Kua.

Relationships and sustainability

A second project that the KSK City Labs team is working on is a super app for owners. The owners of KSK’s maiden development 8 Conlay have access to an app that gives live updates on the construction progress, down to the single unit level.

Unit owners can use the app to call a lift remotely, book a spot for events in the building, order various services and even manage their smart home systems. This relates to Kua’s vision that unit owners should have a relationship with the building. It also extends into the sustainability aspects of property management, she says.

“If you want an energy-efficient and healthier building, you want the owners to manage it. You need a platform to allow the owners to have a relationship with the building.”

KSK is also using Delve to design more precise models and optimise the use of space at the design stage. Coupled with the Building Information Modelling (BIM) technology, it allows the company to reduce material wastage during the construction process.

BIM is a tech-enabled process that allows architects, engineers, contractors and other stakeholders to design and construct buildings on a 3D model. This used to be done via 2D blueprints and, later, through the less sophisticated Computer Aided Design (CAD).

KSK will use BIM in all its projects, says Kua. The company plans to go beyond using BIM for the construction process to using it for facility management, which covers energy efficiency, waste management and preventive maintenance.

How Delve works

Delve was introduced by Sidewalk Labs last October and uses artificial intelligence (AI) to help development teams find the best neighbourhood designs for their project, based on their special requirements.

The team begins by using Delve to identify the project’s planning inputs, which could be the gross floor area for residential use or site constraints, and priority outcomes, such as cost or daylight access.

The software then presents the team with a range of design options, taking into consideration the core components of buildings such as open spaces, streets, energy infrastructure and amenities. It also ranks the design options based on the priority metrics identified by the team.

The design can go down to the unit level, including evaluating the daylight access for each unit, open space access, walkability and views. It can also include integrated financial models and built-in utility models, which provide estimates of electricity use and rooftop solar intake, for example.

Since its launch, Delve has been used by developer Quintain to build a 12-acre mixed-use development near London. After eight weeks, Delve produced 24 high-performing variants for the company that met its complex requirements, according to Sidewalk Labs.

Okalo Ikhena, co-head of Delve at Sidewalk Labs, tells Digital Edge that there are two main use cases for the software. Large-scale mixed-use developers could find it useful, as it can simplify complex processes.

“We also see Delve as a great product for developers who have a high volume of projects in their portfolios. For example, if a developer knows it will be conducting several lengthy feasibility studies in the same year, Delve can help them complete these in a fraction of the time that the traditional process would have taken,” says Ikhena.

To find the best designs, Delve uses publicly available planning information, such as zoning codes and street configurations. But the majority of the data on specific sites is provided by the development team, he adds.

This data includes building types, unit mix and open space. Site constraints cover height limits, zoning, walkability and access to amenities, among others. These data points, coupled with construction costs, net profit and other priority outcomes, guide Delve’s designs.

Ikhena recommends that developers start using Delve at the pre-feasibility or feasibility stage, when the team comes together to identify their goals and constraints before going into the design stage.

“We’ve found that Delve often generates options that were unimaginable by the development team but offer the most financial returns,” says Ikhena.

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