China’s Buildings Are Watching How People Shop, Cook and Steal

Published July 5, 2019, 9:20 PM

by Martin Sadongdong & Antonio Colina

By Bloomberg

Fintech is changing the way people borrow, invest and pay for things. But there’s another type of technology — most noticeably in China — that’s altering the way urban dwellers interact with their living and shopping environments.

Sign up for Next China, a weekly dispatch on where the country stands now and where it's going next.Fintech is changing the way people borrow, invest and pay for things. (BLOOMBERG / MANILA BULLETIN)
Sign up for Next China, a weekly dispatch on where the country stands now and where it’s going next. Fintech is changing the way people borrow, invest and pay for things. (BLOOMBERG / MANILA BULLETIN)

It’s property technology, or proptech — the use of new technologies like big data and machine learning to help individuals and companies buy, sell and manage real estate.

According to Jones Lang LaSalle Inc., investment into proptech startups from 2013 to 2017 totaled $7.8 billion, with China accounting for about 36% of that. In 2018, that figure came to almost $20 billion, data from market research firm Venture Scanner show.

“In China, there is a very dynamic proptech ecosystem, quite mature and advanced at all levels,” Jones Lang LaSalle’s Asia Chief Executive Officer Anthony Couse said at the firm’s first-ever proptech forum in Beijing in May. “Some say we’re slow moving, conservative,” he said, referring to the real-estate industry. “I don’t think that applies to us here in China.”

One oft-cited reason for China’s proptech leadership is that the country tends to put more emphasis on convenience than privacy. That makes it easier for property companies to use transaction databases, facial-recognition cameras and other technology to improve people’s shopping and living experiences, though developers still have to be mindful how they access and use personal data to avoid allegations of overreach.

Here’s a snapshot of some of the ways that Chinese developers are using the internet of things, artificial intelligence and big data to improve people’s living and shopping experiences:

Cooking With Gas

Dalian Wanda Group Co. upgraded its property management platforms at two Wanda Plazas by installing cameras that use behavior-recognition technology to track shoppers’ movements inside the mall, such as how long a person lingers in a store and whether they walk out with a bag in their hand.

The technology, from Wanda’s Huiyun management system, allows the group to capture and analyze a person’s age, gender and shopping patterns, letting the landlord better optimize merchant layouts.

Shoppers don’t know it, but they’re also assigned a computerized ID so they’re recognized upon their next visit. Sensitive information, including people’s facial images, isn’t stored to prevent the risk of personal privacy infringement issues and potential legal disputes, the company says.

The Huiyun technology now tracks conditions in about 280 Wanda Plazas across China, using more than 10,000 sensors in each of them. The sensors also detect heat and moisture levels, air quality and energy consumption. They’re able to compare signals from a cook and the range hood in a restaurant, for example, and flash alerts when a stove is left unattended without being switched off.

Dalian Wanda also uses proptech when designing its shopping malls. The software can construct a three-dimensional model using inputs from the designer and contractor throughout the construction process to maximize efficiency and ensure quality. The technology enables the company to turn a bare site into a shopping mall, with every store open, within 18 months of breaking ground. That compares to around two years of construction alone for a project of a similar size.

Feeding the Fish

Putting sensors around its residential communities has allowed Longfor Group Holdings Ltd. to shift away from a labor-heavy property management system. Developed by the Beijing-based home builder’s service arm using internet-of-things technology, the system has trimmed labor costs on facilities maintenance by as much as 62%.

Some 480,000 facilities with sensors at developments nationwide capture data and send it to a central processing facility. The information can range from lower apartment floors being soaked by summer storms, to an elevator being out of order, or a man-hole cover shifting and potentially endangering passers-by.

If enough data creates a warning, alerts are sent out to maintenance workers in the field who can pick up the job, similar to Uber drivers accepting a booking.

Where manual adjustment isn’t required, automation kicks in. At some developments, water sprays are automatically triggered if sensors deduce that a plot of lawn is too dry. In one residential community in Chongqing, trash cans automatically compress garbage, paring sanitation workers’ emptying frequency to a fifth of usual levels.

What does Longfor do with the employees its technology has put out of work? The company uses them to provide next-level service for residents. An executive who travels a lot can ask these newly trained butlers to feed her fish while she’s away, or elderly people can be walked outside in their wheelchairs every morning. Residents can even rate these stewards, as Longfor calls them, using an app.

Brand Awareness

Using facial recognition technology, Shui On Land Ltd. started to use an app called “INNO” for access control in its Shanghai office buildings. A surprising finding emerged at one city-center tower: 70% of workers were female. So Shui On renovated one of its shopping malls — Xintiandi Plaza — below this office area, tailoring an entire five floors just for women.

relates to China’s Buildings Are Watching How People Shop, Cook and Steal
At the Xintiandi Plaza in Shanghai, visitors can get brand recommendations based on previous shopping habits.Source: Shui On Land Ltd.
Apart from adding new stores from New York-based, Taiwanese-born fashion designer Jason Wu and Israeli cosmetics brand AHAVA, two of the upper floors have been remodeled to resemble a fancy showroom: In one corner, a chic kitchenette extends to a home decoration store, while a shop for outbound travel site sits next to a bookstore.

To further attract female shoppers, Shui On uses big data for distributing coupons and mall maps. First-time visitors can enter their mobile number at a fourth-floor screen to link to their WeChat account, giving Shui On access to their buying habits on Tencent Holdings Ltd., WeChat’s parent company. Immediately, discount coupons are sent direct to a person’s WeChat Pay wallet, making a cup of coffee cheaper or car parking free. The screen also offers brand suggestions based on previous shopping habits. The whole process is pared with facial recognition technology, so second-time visitors need only to stand still in front of the screen.

Shui On is also using proptech in a trial to assist tenants. Sensors, for example, can capture how many times a hesitant customer picks a book up and sets it down — useful information a store can use to reorganize displays and accelerate sales.