PROPTECH-X ‘Proptech & Property News’: Savills say London”held back” | PRODA complete Series A funding

PRESS RELEASE: Backing by real estate market leaders ING Ventures, JLL Spark, Blackstone and Concrete VC will help accelerate PRODA’s efforts to scale its transformative rent roll data platform

PRODA, the London-based data processing and analysis platform, has announced the completion of its Series A funding round. The fundraise was led by existing investor ING Ventures, and welcomes JLL Spark, Blackstone Innovations Investments and Concrete VC as new investors.

The backing by major stakeholders in the real estate sector will help PRODA establish its software platform as the centralised hub for processing and analysing lease, property and unit level data.

Launched in 2017, PRODA is a cloud-based SaaS solution that captures, standardises, validates, analyses and exchanges rent roll data – a critical input leveraged throughout the commercial real estate industry among lenders, investors and asset managers given the property level detail captured. Regardless of currency, language or property-type, the machine-learning trained platform automates a previously manual and error-prone process, resulting in up to a 90% reduction in overall processing time in addition to higher quality data for its users. The platform provides companies with increased visibility, real-time property reporting and operational efficiencies demanded in the current market.

PRODA currently operates across 16 countries, strategically tailoring its platform to regional needs. Their flagship technology includes new additions such as the tenant exposure and risk analysis tool, as well as an advanced charting tool that significantly saves asset managers time by formulating data exactly to their required specifications. The funding will be used to continue to scale the breadth and depth of PRODA’s platform and grow its presence in and beyond Europe to meet the growing demand for its services.

Peter Bredthauer, Co-founder and CEO at PRODA, said:

“We are thrilled that companies like ING Ventures, JLL Spark, Blackstone and Concrete VC took part in our latest funding round. Alongside existing investors like SURPLUS Equity Partners and M7 Real Estate, we have fantastic support as we continue to fulfil our mission of transforming data from a headache into an asset.”

Vincent Buitelaar, Director at ING Ventures, adds:

“As both a customer and an investor, we have been hugely impressed with the progress PRODA has made since the previous round of fundraising. Not only has the team grown to meet rapidly increasing demand, but PRODA’s product development has been exceptionally well thought through, enabling us to provide best-in-class services to our employees and clients.”

Tanguy Quero, Investment Principal at JLL Spark, the corporate venture arm of JLL, also comments:

“Our investment in PRODA aligns with JLL Spark’s strategy of backing early-stage startups that can solve the most pressing issues in commercial real estate. PRODA’s unique solution enables up to 90% productivity gain in rent roll data management and we are pleased to be a part of their future growth.”

John Fitzpatrick, CTO of Real Estate and Private Equity at Blackstone, also comments:

“At Blackstone, we are always looking for best-in-class technology solutions that help support the growth and scale of our global businesses. PRODA’s product addresses the historically manual activity of processing clean rent roll data and will drive meaningful efficiency gains across the underwriting and asset management activity within our real estate business. We look forward to working with the PRODA team as they continue to advance automation and data intelligence across the industry.”

Arnaud van der Wyck, Managing Partner at Concrete Ventures adds:

“PRODA is solving a real pain point across the real estate sector. More efficient, accurate, standardised and centralised rent roll data allowing for higher degrees of analysis is an important solution that our partners and the wider industry are looking to adopt. We are excited to be part of the funding round and look forward to working with PRODA to drive value across their business.”

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About PRODA

PRODA’s software automatically captures, standardises and quality checks the rent roll data used within the institutional real estate market. Co-founded by two ex-fund managers, the company’s goal is to empower real estate professionals to quickly gain actionable insights from their data and to facilitate the use of technology within the industry.

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Growth in Prime Central London continues steady recovery, but is held back by stalled return of international demand

Growth in prime central London reached +0.7% on the quarter and +3.3% on the year, the highest annual growth seen since September 2014 However, recovery has been held back due to stalled return of foreign investors and the war on Ukraine Houses continue to outperform flats on an annual basis – but the gap between the two is narrowing Lack of stock continues to have a significant impact on the market, according to Savills agent survey (45% in prime central London agree and 42% in outer London), ahead of rising interest rates and the increased cost of living Rising interest rates to have biggest impact on South West and West London family house markets where levels of borrowing are higher 

Prime central London prices are continuing to grow at a steady pace, but its recovery has been delayed by fewer than expected international buyers and the war on Ukraine, according to the latest prime London sales index (Q2) from property advisor Savills.

Growth totalled just +0.7% on the quarter – and is up +3.3% on the year. This is the highest annual growth seen since September 2014.

“As London continues its return to normality, central London values have continued to recover over the past three months, after being in the doldrums for much of the pandemic. However, prices in prime central London are still down -17.6% on their 2014 peak, meaning there is still plenty of opportunity for buyers – especially those buying in foreign currencies, given the recent improvement in currency advantage.

“But unless high net worth foreign investors return in their pre-pandemic numbers, we can expect the market to continue to recover at a slow and steady pace, rather than with a sharp uptick,” comments Frances McDonald, research analyst at Savills.

Lack of stock remains an issue, as well as slow return of international buyers

A lack of stock remains the biggest issue facing the market, cited by almost half (45%) of Savills agents in prime central London and 42% in outer London, though this is down from 64% and 68% in Q1.

“Sales at the top end of the market have been driven by domestic buyers since the start of the pandemic and remain the driving force of the market. International arrivals to the UK are still -18% lower than the same period in 2019, as a result growth is delayed by a slower than projected return to normal travel.

“The top end of the market is less reliant on borrowing, reducing its exposure to further rate rises. However it is not completely immune. The low cost of borrowing over recent years has allowed prime buyers to take out larger mortgages, particularly in the South West and West London family house markets. However, with rates still historically low, we don’t expect to see any impact in the short term, particularly given the high levels of equity across most prime locations and buyers’ propensity to lock into fixed term deals,” McDonald concluded.

Flats vs houses

Houses continued to outperform flats on an annual basis – but growth is slowing and the gap between the two is narrowing. Houses in outer prime London grew +1.2% on the quarter (down from +2% in Q1) and by +0.8% in prime central London (down from +1.2%).

Flats in both London markets grew +0.5% over the quarter but performed strongest in West London (+1%), where houses have increased in value the most during the pandemic. 

“The return of workers back to the capital has been a driving force in the rebalancing between houses and flats. Even with hybrid-working becoming more conventional, workers still want to be close to the office, and the number using the tube to travel into the City hit a new post pandemic high in June at 60% of the pre-pandemic norm”, continued Frances McDonald.

“As a result of changing demand, the distribution of growth has shifted away from locations which performed best over the pandemic, to areas of London which combine strong first-time buyer, family and investor markets – as well as outside space. Notting Hill (+2.2%), Clapham (+2.1%), St Johns Wood (+2.1%) and Pimlico (+2.0%) have overtaken the likes of Wimbledon (1.4%), Chiswick (+1.0%) and Wandsworth (+1.0%).