Proptech’s Growing HR Role Aided by Labor Shortage, Remote Work

While proptech does not generally provide complete HR outsourcing, it does approach specific needs in indirect but effective ways, experts said.

One example of proptech’s contribution to HR servicing is solving the challenge many real estate companies have in sourcing and signing talent, particularly women professionals, said Christophe Garnier, co-founder and CEO at Upflex, a Manhattan-based, global SaaS provider for the hybrid workplace.

“One of our users, a very large tech company, found job applications from women skyrocket when they committed to a flexible workplace policy,” said Garnier. “So flexible workplace policy is definitely a huge driver of talent acquisition, even talent retention in general.”

Upflex works with its clients’ heads of real estate, who generally set flex space policy for a company, he said. The employee data resulting from such flex policies is conveyed back to Upflex by the client’s head of HR, completing one aspect of the relationship cycle.

“The feedback is really positive in terms of data, which means better employee happiness and retention, but they leverage that for employee acquisition as well, snatching talent over a wider geography,” said Garnier.

Lanyard, a Manhattan-based tech platform that aids employers in finding and managing workforce housing, is addressing another slice of the HR services pie, said Nina Kleaveland, the company’s CEO and co-founder.

Started in the midst of the pandemic in 2020, Lanyard was created as a hostel brand providing seasonal destinations across New England, including skiing and hiking venues.

“We realized last year that there was a greater need for those shared rooms and seasonal destinations, and that was for workforce housing,” said Kleaveland, who added that the startup is in a pre-seed round. “So we pivoted the company in the summer of 2022.”

Lanyard now focuses on helping employers to fill seasonal or temporary positions. “They typically need a place to stay,” she said of such workers. “It’s become a competitive advantage for an employer to guarantee access to housing for those temporary traveling seasonal workers.”

Lanyard works with hotel management companies that typically have a portfolio of 50 to 100 hotels across the U.S., Kleaveland said. The proptech company counts the hospitality, tourism and food services industries among its clients, working with amusement park vendors, timeshare companies, food service vendors, and other food and beverage providers.

“That’s our target, and in terms of growth, what started as a hypothesis around seeing a need for seasonal workers has expanded,” she said. “We talked to a hotel recently in Nashville, who said that they are going to be hiring year-round international workers to fill their housekeeping positions. So it’s no longer just a seasonal need. Because of the skilled labor shortage, a lot of these businesses can’t find people in the local market to fill the open roles.”

Lanyard’s clients are using the startup’s proprietary technology to scrape long-term employee group housing opportunities, saving their HR professionals time and effort at a task in which they’re probably not proficient, said Kleaveland.

“We’ve heard many employers say to us, ‘I would hire more workers, but I can’t because we don’t have housing for them,’ ” she added. “We essentially enable them to maximize headcount, which has an impact on revenue.”

Kleaveland also said Lanyard can save employers money by streamlining the research and the paperwork that goes into housing hires. That includes freeing employers from having to hire additional HR staff in the first place. 

Landlords and occupiers have also turned to proptech data companies to aid them and their HR heads in evaluating employee space use.

One company providing such data is Butlr, a Burlingame, Calif.-based proptech startup that uses heat sensors and machine learning to capture employee positioning and their posture in buildings, said Honghao Deng, co-founder and CEO at Butlr.

“Specifically, it’s interesting that posture detection is important to hospitals and senior care, but occupancy numbers are what most of the commercial real estate players care about today,” Deng said.

From an HR perspective, two major concerns for big corporations today are using large footprint space efficiently coming out of the pre-COVID expansion phase, and the changing nature of how workers are using office space, Deng said.

“Their workplaces are becoming call centers,” he explained. “That’s what they call it. The form of how people collaborate changed. Before it was all about the in-person meeting, but after two years working remotely with a remote team, it’s a lot more about conference calls.”

Given that change, employers are as focused on providing employees with the right type of space, not just the right size, said Deng.

“What we have been seeing from the HR perspective is a new form of collaboration in the office based on all those learnings in the past few years,” he said. “What will be the new form of office design? They’re embracing this new format of collaborating more with the team, being in a focus room, huddle room, or even a phone booth, all of which are much more needed. It’s not about cubicles.”

In addition to the somewhat niche proptech HR services companies, Upflex’s Garnier sees growing demand for more comprehensive real estate tech outsourcing in this department.

“Absolutely,” said Garnier. “The rationale here is that because teams are becoming globally distributed, and because hybrid is becoming the standard, employers are forced to use multiple workplace providers. They need to think about optionality, and thinking of optionality and flexibility requires maintaining more relationships, more billing, more procurement process.

“This is complex, and that’s why they need to outsource that to proptech companies in order to make sure that they can make this bearable and digestible for them.”

As traditional companies, including those in real estate, increasingly look globally for talent, they are turning to technology-centric HR providers such as Denver-based Velocity Global and San Francisco-based Deel, said Garnier.

“They are two of the biggest companies that are doing that and have seen fantastic growth over the past 24 months,” Garnier said. “Both those companies are enabling employers to hire employees anywhere, which is extremely difficult to do for an HR department.

“You can imagine the amount of administrative processes for each country, plus insurance and all those things. It’s extremely complex and that’s why both those companies have actually raised hundreds of millions of dollars.”

Philip Russo can be reached at prusso@commercialobserver.com.