The merger of VTS and Hightower this week to create a 5bn sq ft platform manager under the VTS brand worth an estimated £240m has been hailed as a vote of confidence in the proptech sector.
Faisal Butt, co-founder and chairman of proptech investor PiLabs, said the industry would go mainstream next year.
“More conventional businesses are starting to buy out so the exit for some of these proptech start-ups will be the mainstream firms,” he said.
“You will also see proptech start-ups start to merge, creating critical mass to create more of a dent.”
VTS and Hightower’s announcement was the second major proptech merger this year, after virtual reality firm Matterport bought Virtual Walkthrough.
Ryan Masiello, co-founder and chief revenue officer of VTS, said the tie-up meant improved efficiency for customers, speedier innovation, and better technology.
Dan Hughes, director and proptech lead at RICS, said big deals like this would give the sector credibility and the property market would have to engage in tech conversations in the future.
EMEA sales director at Matterport, James Morris-Manuel, said: “This will definitely consolidate and solidify that the proptech sector is something that is here to stay and will lead the future in terms of the industry.”
Morris-Manuel added that proptech would increasingly be viewed as a viable asset class to invest in in both the US and UK.
He said: “This is one of the few remaining sectors where there is still a huge amount of growth potential. Compared to fintech, which is used by the whole finance industry and where there is a lot of companies already, proptech is still in its infancy. There is so much more that can be done.”
Nick Romito, chief executive and co-founder of VTS, will remain in his role as chief executive. Brandon Weber, co-founder and former chief executive of Hightower, will assume the role of chief product officer.
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