JLL Launches $100M Fund for PropTech Startups
JLL is one of the largest players in real estate, with over $7B in revenue and over 77K employees around the world. Now, the real estate developer and property manager is getting into the property tech investment game with the launch of a new $100 million fund run by corporate subsidiary JLL Spark.
“Creating this $100 million venture fund through JLL Spark allows us to continue to lead the real estate industry in bringing the best proptech ideas to reality. It complements and expands our substantial ongoing investments in innovative, cutting-edge digital solutions, which is a core part of our Beyond strategic vision and commitment to achieve ambitions for our clients,” JLL’s Global CEO Christian Ulbrich stated.
JLL Spark started as a technology-focused business unit of the multinational real estate company, but the firm eventually turned to the more traditional venture capital investment model as a way to get more exposure to all of the new technologies that are coming to market, according to JLL SPark’s co-chief executive Mihir Shah in TechCrunch.
JLL recently partnered with MIT to find the newest technology affecting commercial real estate
What Types of Startups is the Fund Focusing On
The firm will invest anywhere from a few hundred thousand dollars to a few million into seed stage or Series A companies with the option to dabble in later stage deals, according to Shah. The firm has made two investments so far — neither one of them in startups. Both investments appear to be geared toward educating the firm’s two principals on the market and what’s already happening in the space.
In an interview in Forbes, Shah stated, "Real estate will benefit from greater efficiencies and increased productivity through technology. It already has to a great degree. Real estate is a very data-driven industry. Investors make decisions to buy assets based on data. Developers make decisions based on demographic and financial data. Technology can help streamline those decision-making processes. There are non-data applications too. Look at virtual reality. Two years ago, VR was nonexistent in real estate. Today, we see so many applications from advanced design to pre-marketing of to-be-built space."
In one of its first moves, JLL acquired Stessa, which developed and sold asset management software for the real estate industry. But Shah and Lerner quickly realized that the buy and build strategy wouldn’t be robust enough for JLL’s needs.
The benefit that a corporate firm like JLL can provide to startups is the access to pilot projects where companies can deploy their technologies.
“Money is not enough,” he stated in TechCrunch. “There’s a lot of products out there, but they’re struggling with distribution.” JLL has designated a few buildings in top cities around the world to fast track new technologies and provide trial spaces for them to develop, Shah states. “Our value as a strategic is to build that bridge and make that connection.”