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How Connected Building Technology Delivers Business Value in Commercial Real Estate

A new opinion paper from IDC explains how connected building technologies can help deliver higher real estate asset values and help manage the new challenges brought about by the global pandemic.

A new opinion paper from IDC explains how connected building technologies can help deliver higher real estate asset values and help manage the new challenges brought about by the global pandemic.


December 10th, 2002

Like many other verticals, the global pandemic has revolutionized commercial real estate. While the industry was already dealing with challenges including operational costs, energy efficiency and ongoing sustainability of real estate portfolios, now it must also focus on the health of building occupants and rethink how space is used. A new opinion paper from IDC explains how connected building technologies can help deliver higher real estate asset values and help manage the new challenges brought about by the global pandemic.

In our recent webinar, Carrie MacGillivray (Group VP and GM for Mobility and IoT Research at IDC), Ruud van der Sman (Sr. Smart Solutions Manager at Edge Technologies) and our own Cormac Crossan (Business Developer of Commercial Real Estate), outlined the trends they see in the commercial real estate market and how smart building platforms can help address them based on their experiences and recent research.

“Our goal is to create IoT-enabled buildings which can serve all kinds of services on top of that data- services, data sharing and data processing- those are the most important topics for us and why we have selected Schneider Electric- next to all of their capabilities, especially the data side. That’s the most important one.” – Ruud van der Sman, Sr. Smart Solutions Manager at Edge Technologies.

Evolving commercial real estate priorities
Prior to the onset of COVID-19, the top commercial real estate priorities were keeping costs down, making spaces more appealing for tenants, and meeting sustainability goals through increased energy efficiency. Presently, those priorities are all still in place, MacGillivray said, but they’re joined by three additional priorities:

A need to focus on the health of employees, tenants and customers
Ensuring safety and compliance
Rethinking how space is utilized to meet social distancing guidelines
These overall drivers are pushing commercial real estate players to adopt connected building technologies that can help them deliver on these priorities. For one, the technologies are the foundation of a connected building, one that uses sensors, connects disparate engineered systems and optimizes operation.

Another driver is the ability to make data-driven development decisions, helping companies to optimize new projects and adopt predictive maintenance capabilities, which leads to improved tenant satisfaction.

The third driver is a desire to be positioned as a leader in sustainable design. Connected building technologies can help companies meet or exceed sustainability goals, create sustainable urban designs and achieve long-term cost savings, MacGillivray said.

How connected building technology delivers value
IDC’s research showed that connected building technologies can deliver value in four distinct areas:

By maximizing market value: simply put, attractive properties are worth more and the kind of benefits smart building technologies bring – including improved comfort for tenants and lower operating costs – make them attractive.
Delivering operational efficiencies: by collecting and leveraging real-time data and applying policies across buildings, companies can optimize the use of office space and electricity, while requiring fewer staff resources for ongoing maintenance. One of her survey subjects said the strategy resulted in electricity savings of 15% to 20%.
Tenant experience: companies report improvements in measurable metrics such as tenant complaints and time to resolve issues, as well as less tangible areas such as employee comfort, which is important in terms of employee productivity and the overall customer experience.
Green building and sustainability gains: a building’s “green” credentials such as LEED, BREEAM, WELL and others are often a clearly stated decision criteria for tenants, and can drive higher property values and rent levels.
EcoStruxure™ for Commercial Real Estate solutions deliver business results
For their research, IDC interviewed companies that were using our EcoStruxure for Commercial Real Estate solutions, an open IoT platform that brings together data from numerous smart building sensors and components, including lighting, HVAC, access controls, surveillance systems, energy management, and shade/sunblind controls.

The research showed the value customers are getting from our platform, including:

83% fewer operational problems: getting sensor-based, real-time data meant companies could act quickly to address problems
11% fewer tenant complaints: not surprising given there are fewer problems
43% faster time to resolve operational problems: diagnosing issues more quickly and pinpointing the source of problems
8% higher employee satisfaction: tenants are more comfortable with office temperatures, air quality, and overall office conditions.
18% energy-related cost savings
Ruud van der Sman echoed some of IDC’s findings. He believes EcoStruxure is helping his company meet many of the demands the pandemic presents. It’s a simple matter to regulate air circulation, for example, to meet new guidelines and make sure rooms are clean before anyone enters.

Edge Technologies is currently developing touch screen technology that will display a room’s air quality metrics, such as via a tablet on the wall. The technology will make clear whether the room is safe or not, and even count the number of people in the room and, based on the layout and air quality metrics, issue a warning if there are too many people in the room.

The best part? “We can do that by using data we already have,” he said, thanks to EcoStruxure.

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