Digital transformation is a hot topic right now and it is synonymous with major changes occurring across most industries today, including real estate. Proptech, a term used for the technologies that are disrupting the status quo of the property industry, is transforming not only how we live in, work in and use buildings, but how we manage them too.
Leaders in retail, commercial, airports and even some cultural institutions have been some of the early adopters of digital technology across real estate. By digitising their assets with building analytics technology and operating their buildings in a smarter and more efficient way, building owners and operators are uncovering a plethora of outcomes that benefit tenants, shareholders and the community.
So what does it mean to digitise a building and why is it taking off across real estate?
The case for digitisation
Large buildings are dynamic environments consisting of hundreds or often thousands of interconnected components and systems that must work together seamlessly for a building to perform as it is designed to.
These various systems and equipment generate a wealth of data that, if extracted and analysed properly, can paint a picture of building performance. A building management system (BMS) will consume the data it requires to ensure basic building functionality, however, it cannot self-analyse this data, deep dive into it to find the cause of building faults or identify opportunities within it to operate a building more efficiently.
This is one of the key reasons why managing buildings and troubleshooting issues has often been a very manual, time-consuming and difficult process.
Traditionally, building operators have been reliant on the best judgement of contractors and technicians, that is, people coming to site and providing their two cents about what needed to be fixed and replaced and upgraded. This advice would vary based on that person’s level of expertise, however if the technician who was knowledgeable about that building left their job, all of that knowledge would often go with them too.
Another approach was to scroll through endless amounts of trend data manually to try and figure out exactly what was going wrong. There had to be a better way.
Transforming operations with building analytics
In the latest episode of CIM’s Building Peak Performance podcast series, we discuss technology’s role in transforming the built environment and why it is having such a dramatic effect on the real estate industry.
Building analytics technologies, such as CIM’s PEAK platform, for example, are helping drive a massive digital transformation across the built environment because the technology provides building owners and operators with a simple, smart and transparent way to operate buildings.
With analytics you can monitor the whole building system automatically and continuously for 24 hours a day to detect problems and diagnose the exact root cause of the issue.
The technology works by extracting data off the BMS and other sensors connected to the building’s network, including the data previously hidden behind proprietary systems controlled by contractors, and applying rules-based algorithms for instant fault detection and diagnosis. PEAK can then validate the work that’s been carried out by contractors or technicians and quantify the benefit of fixing it quickly.
This incredible access to data that we now have provides us with a really accurate lens into the actual operation of a building and its enabling the entire built environment to do things in a smarter, more efficient way.
Tangible benefits for all stakeholders
So how does this approach benefit building operations teams, owners, tenants and shareholders?
By adopting a more proactive, data-driven approach to building management, operations teams are able to fine-tune and optimise equipment so it lasts longer, streamline maintenance activities to save costs and create a better experience for tenants and visitors.
The technology also enables onsite teams to identify opportunities to improve building performance across individual sites or portfolios, and make smarter capital planning decisions.
From a strategic level, efficient buildings also use less energy, have smaller carbon footprints, and receive better environmental ratings. They also generate higher asset valuations for shareholders.
For example, PEAK identified opportunities to operate the chillers much more efficiently in a building owned by one of our Australian retail clients. This change was then applied to all chillers across their building portfolio, which ended up saving hundreds of thousands of dollars. The associated increase on the asset value from optimising the chillers was in the millions of dollars.
A better run building is inevitably going to be a more sustainable building, which is inevitably going to be a more valuable building. And this is the driving force behind the digital transformation of real estate today.