This article appeared in the tech issue of Urban Land on page 64.
The discussion about whether smart buildings are a fad or a necessity for the future of real estate should come to an end. Instead, professionals should be realizing the advantages a smart building can provide for people and the planet.
Successful case studies of the implementation and optimization of smart building solutions heavily focus on outstanding user experience.
Buildings serve as places where people live, work, and interact with friends and colleagues. Thus, an office building should actively boost the productivity of its users while supporting a healthy and balanced lifestyle to directly contribute to their well-being. On top of that, it should connect with building operators and other relevant services through technology.
And, finally, buildings must be considered within their surrounding environment of the built world and natural spaces, including their relationship with infrastructure, energy consumption, mobility, and people. Smart buildings are an important piece in the puzzle of smart cities—cities that create a better and healthier environment, consume less energy, and better manage the flow of people.
There is no generally accepted definition of what constitutes a smart building, nor what constitutes a smart city. However, a common understanding exists about what they should do: smart buildings and smart cities should reduce the carbon footprint, decrease consumption of resources such as energy and space, provide efficient mobility, and contribute to the long-term health and well-being of occupants.
Those engaged in design, architecture, and technology should follow these priorities—maximizing building efficiency and user well-being. Where designers and architects make huge efforts conforming to the trend of “new work”—the workplace of the future—the technology in their buildings often falls short.
What a Smart Building Can Do
A truly smart building employs technology to fulfill several functions, provide the best possible user experience, and meet the demands of large organizations and other stakeholders. Optimization of building operations and processes, more efficient use of space, and increased employee productivity are precursors of what will be possible in the future.
Building operations and processes. Sensors generate data about the status of building operations and processes, allowing their adjustment based on that data. Fully automated and intelligent building control has the potential to reduce energy costs by up to 40 percent—particularly helpful when climate change and sustainability targets are gaining increasing attention at large organizations. Today, buildings are still regularly controlled by seasonal fixed-time programs, resulting in suboptimal working conditions for users, inefficient building operation, and wasted energy. But technology has the ability to control buildings according to actual user behavior and preference.
Use of space. Fine-mesh data can provide valuable insights to the corporate real estate manager. For example, use rates for meeting rooms and other shared spaces can be continuously monitored and analyzed, providing tenants with valuable information. According to JLL’s “Occupancy Benchmarking Report,” an average worker is away from his or her desk for 60 percent of the time, causing office space to be highly underused. Reducing that away-from-desk number provides tenants with a significant potential for cost reduction as space becomes increasingly expensive. The JLL report also reveals that 77 percent of corporate real estate professionals want to improve the quality of their space-use measurements. While occupancy is listed as the top metric for their corporate real estate organization, only 61 percent of organizations track space use, according to JLL. Conclusions can only be as good as the underlying data. For proper decision making, data about space use must be assessed on a permanent and ubiquitous basis, which requires a fine-mesh sensor network.
Employee productivity. Data can be used to learn about individual preferences and employee needs, allowing managers to act immediately on that knowledge, thereby ensuring that issues are resolved swiftly and that resources are provided as required.
How to Enable a Smart Building
In the human body, the nervous system collects fine-mesh and real-time data, and sensory organs ensure that enough useful, valid, and representative data is collected to support important objectives. A smart building functions in a similar way and, employing the collected information, can learn use patterns and adjust its operations predictively and proactively—just as the human body does.
In order for a building to do this, the quality, availability, and security of the provided data need to be ensured. Data security, in particular, is critical and serves as a basic need for technology acceptance. Next in importance, data transmission speed and latency need to meet the highest standards if sensors are to provide real-time information and building systems to react to changes in conditions.
Having fulfilled those basic requirements, one can start to create a seamless experience for the user. Data that nobody understands does not add value for stakeholders. The ability to analyze, understand, and present the most important conclusions—adjusted to individual stakeholders’ preferences—is the most important element for addressing the needs of stakeholders and increasing demand for smart building technologies. People need to be able to profit from the technology without having to understand the details and infrastructure behind it. Dashboards and apps need to create that seamless experience and maximize the created value.
Challenges of Smart Buildings
Alongside euphoria there will always be skepticism. To address data security and user acceptance, real estate professionals must include the most important stakeholders from the very start of the planning process and create smart buildings that address their basic needs. Without that commitment, planners risk constructing the smartest buildings that no one is willing to pay for.
Another challenge is that installations must be updatable and scalable to meet the changing needs of users and provide flexibility in times of frequent technological change. Software developers and hardware manufacturers are innovating at an ever-accelerating rate, making it difficult to stay on top of the market, thereby increasing the need for standardized data protocols.
In addition, there is understandable skepticism about data security, cyber-security, and privacy. Solutions by startups and traditional players should always be assessed regarding their resilience, where they store data, and the encryption technology that they employ.
Though many different ways and technological solutions exist to make a building smart, there is also still a lack of standardized solutions on the market. Only a few can ensure provision of the required security and real-time availability of data.
It is widely accepted that lighting is the best physical infrastructure to make a building smarter, because lighting is a common requirement throughout a building or campus and the lighting infrastructure is highly granular.
Powering of LED lights with standard network infrastructure, also known as power over ethernet (PoE), has started its triumphal march. Electrical and data bus infrastructures are replaced with network cabling to create a fine mesh network and make a building fully connected, flexible, and intelligent, providing the basis for a truly smart and automated building.
However, PoE solutions have some disadvantages: PoE lighting requires additional proprietary and power-wasting drivers at each light fixture, as well as, often, additional active network devices in ceilings, which together consume more power for upholding network communication than the lighting itself. It creates ethernet network traffic with no added benefit, requires an external lighting network management system, and adds hundreds or thousands of additional internet protocol (IP) addresses that must be managed and maintained within a building.
The company I work for, wtec, came up with a solution that keeps all the benefits of network-powered lighting and eliminates the disadvantages of PoE. It does so by powering LED lights via standard data cabling using safe low-voltage DC power combined with multi-sensors at each light fixture position. The wtec smartengine technology was designed specifically to make building infrastructure less complex and easier to change, reduce installation work and materials, and provide maximal energy efficiency. The Silicon Valley and Frankfurt–based technology firm, launched in 2011, has not attracted much attention in the real estate world yet, but its clients understand its potential and have pushed the technology toward their needs.
With the smartengine system, a fine-mesh network of multifunctional sensors collects information about the building’s occupancy, temperature, and power consumption. This data is shared with the building management system and matched with other relevant data sources (such as weather data, bookings of space, and security systems), allowing optimization of the building’s performance. The need to understand space use and find available workspace—key to users and corporate real estate managers—is addressed by providing real-time and historical data in high resolution all over the building.
Creating large amounts of data also raises the question of how to comply with data protection and privacy requirements. Smartengine ensures that data is stored where it is created—locally. Access to the data is controlled by the tenant using standard state-of-the-art network authentication and authorization methodology.
Landlords and operators can use the open API (application programming interface) to run the heating and cooling system more efficiently in response to fine-mesh occupancy and temperature data, or the tenant can share the data with smart-building or tenant-engagement app providers that already offer useful solutions.
For more advanced users, a secure cloud connection can be established with any major cloud provider. This enables, for example, benchmarking of data against other buildings and the use of artificial intelligence for prediction and advanced analytics.
In addition to a fine-mesh sensor network collecting the right type of information and doing so in a secure way, all devices inside the building should be able to communicate and deliver data as well as “listen” to other devices. Just like humans, a smart building needs a brain where this information comes together, is processed, and is stored. The brain then needs to act, learning over time to become better and make better decisions, serving all stakeholders. A number of companies are working on this and offering first solutions, which are likely to improve when infrastructure to provide data and connectivity has been installed in more buildings.
With further installation of smart building infrastructure like the smartengine technology, paired with connected devices, “brain” software, and tenant apps, the benefits of intelligent buildings will become evident. This will boost the urgently needed discussion about common standards for open and secure exchange of information and break down old silos of proprietary protocols and systems. In the future, all devices could be connected to a single internet technology infrastructure, a “virtual bus” cable over which they communicate with each other without friction and without intermediaries. People will understand and use the perks of this new class of building.
Smart buildings will grow together and include other elements like infrastructure, mobility, and services to create smart neighborhoods and cities. The rising use of technology will also create new challenges that need to be solved. Technology will have huge impacts on work and productivity and society.
How we embrace these changes—and whether we deal with these technological changes in a responsible and human way—will determine the future of our cities and society.
JOHANNES NUSSBAUM has been working in real estate since 2011, starting his career at Art-Invest Real Estate, a leading German developer and investor. He works as managing director at wtec GmbH, the manufacturer of the smartengine technology. He has been nominated as a member of the ULI Smart City Council Germany.