When you think about competitive advantages in commercial real estate, you don’t necessarily think about access to data. But access to actionable data has revolutionized many industries and is becoming a real competitive advantage in most of them. Data is no longer reserved for scientists and accountants. Data-driven operations have become a staple for business operations from measuring sales to marketing to customer satisfaction.
Now that real-time data has become available for commercial real estate, it is time to take advantage. Many large companies already take advantage of tools to track their portfolio’s performance, based on occupancy rates and tenant retention. However, there is now an opportunity to streamline operations in a way that has not been done before.
The world of smart building technology is hardly plug and play, however. The typical commercial real estate owner has always operated in a universe of disparate building management systems. Today, each of those systems may have one or more attendant IoT sensors, each collecting massive amounts of data. These multiple systems and sensors can be integrated with one another and fed into analytics tools and enterprise software to deliver new value. But linking them together to turn data into differentiation is no trivial task.
In an industry segment where the required number of square feet per employee is shrinking, commercial real estate (CRE) operations should be looking for ways to differentiate and to make their teams more productive. With the ability to automate data collection and streamline operations related to energy efficiency, budgeting, and sending tenant invoices, decisions can be made faster and more effectively.
Commercial real estate owners who want to develop intelligent business management systems can do so by building a solid foundation for IoT systems. A thoughtful plan will capture all the key requirements, including those for architecture, infrastructure, hardware, software, networks, and security. It will also lay out the event-based logic that will drive business functions.
Collaborating with key vendors and contractors (such as facilities management or electrical suppliers) will result in a more effective strategy. The business case for smart buildings can vary greatly by property characteristics and use, so significant customization may be required. But beyond site-specific considerations, there are three common and critical aspects of the smart building plan.
The goal is to make sure data moves seamlessly throughout systems, from off-the-shelf facilities management and security systems to custom mobile apps. It’s important not only to ensure that these systems are technically well connected on the back end but also to deliver a seamless user experience on the front end. There are a number of integration software and platform options on the market. Commercial real estate owners can also develop advanced mobile computing capabilities that integrate systems. The adoption of common standards and protocols will further facilitate the full use of IoT technology.
Owners of smart buildings will need to leverage large amounts of data, with much of it unstructured. To do so, they can develop advanced data aggregation and processing capabilities using advanced big data tools and build flexible platforms for building data collection and exchange. But big data is as much a people problem as it is a technology issue. Commercial real estate companies haven’t traditionally been high-tech shops. As they move into ownership of intelligent buildings, they’ll need to build talent pools with the relevant data and analytics capabilities.
The increased connectivity and data capture that takes place in smart buildings increase risk. The most important decision commercial real estate owners can make is to select cyber security and data protection products built for the IoT age. Trying to retrofit existing security solutions for smart buildings could increase risk. However, some tried-and-true cyber security best practices are establishing data baselines in order to identify aberrations; instituting data collection, storage, and use governance; and creating loosely coupled systems to avoid widespread impact if one device fails will also serve intelligent buildings well.
Many in the commercial real estate industry are still in the early stages of IoT adoption. However, the IoT is here and changing the commercial real estate industry for the better. To put it simply, if you wish to remain competitive in the commercial real estate industry during the age of the IoT, you have only one option: Disrupt yourself before the competition does it for you.