Deloitte's annual Commercial Real Estate (CRE) Outlook report, “Innovations in Commercial Real Estate: Preparing for the City of the Future” asks CRE owners if their buildings are future-proofed for new technological innovations. Deloitte analysts cite five key trends disrupting the CRE marketplace, from the proliferation of Big Data to new trends affecting the need for parking lots in expensive CBD areas. But what's the common thread tying these five themes together? Connectivity.
When implemented strategically and supported with the necessary connectivity infrastructure, these trends will help CRE property owners ensure their workplace environments are fully equipped for future technological advances. Read on for WiredScore's summary of the report.1. Future of Mobility
The rise of on-demand transportation apps including Uber, Lyft, and car-sharing leader ZipCar have started to impact the workforce’s reliance on personal vehicles. Growing acceptance of ride-sharing along with the rise of emerging technology, including self-driving cars, may impact CRE’s need to accommodate high-volume employee parking lots which occupy expensive square footage in CBDs.
Properties that operate on-premises parking for tenants may not want to immediately repurpose the space but, there is an opportunity to embrace new mobility trends. 'Smart parking' technology is beginning to roll-out in well-connected cities across the globe and engineering company Bosch announced their "community-based parking" pilot program at the 2017 Consumer Electronic Show. With a robust connectivity infrastructure in place, CRE property owners could adapt this principle to employ parking spot detection technology tethered to the internet in the garages or parking lots they provide for their tenants.
As mobility patterns continue evolving, the CRE industry may see an impact on property valuations, future development strategies, or location decisions. Owners and developers who embrace connectivity now, will be better prepared to address and adapt to the needs of their tenants in coming years.
2. Occupant Health and Wellness
A 2016 Deloitte Millennial survey found that Millennials continue to place importance on wellness in the workplace. With Millennials making up the largest percentage of the US population and workforce, CRE owners and developers are strongly recommended to integrate health and wellness into their strategies for 2017 and beyond. Integrating smart sensors or i-Beacons can help regulate thermal temperature, air quality, lighting and other environmental factors. Landlords can share the environmental and movement pattern data they collect in the building with tenants. This service will educate tenants about their employee's behaviors with the hopes of boosting employee productivity and happiness.
Monitoring devices require integration into connectivity networks or other infrastructure systems include HVAC or electrical. If landlords and property managers want to take full advantage of these devices to attract tenants, they must have the necessary connectivity and infrastructure in place to support implementation.
3. Internet of Things (IoT)
Sensors and iBeacons fall into the Internet of Things category, but CRE’s consideration of IoT must include the proliferation of other personal and professional devices. Beyond laptops tethered to Wi-Fi, employees bring mobile devices, tablets, and other “smart” tools into the workplace. Employees expect that they will have the same quality of service they experience at home when they are the office. If tenants are struggling with poor cell phone and cellular data reception in the building, CRE owners should prioritize an in-building mobile or DAS solution to ensure tenant satisfaction and retention. When implemented strategically and integrated into the network, IoT has the potential to transform building management and tenant experience.
4. 3D Printing Technology
Deloitte predicts global 3D printing industry revenues to double to $35.4 billion by 2020, from $15.9 billion in 2016. As 3D printing capabilities mature, engineering and construction professionals should take note. 3D printing is rapidly emerging to reduce construction costs while increasing job-site efficiency. Developers in China and Dubai have already built low-rise structures using 3D printing, and it won’t be long before this technology sees greater adoption in the US market.
5. Demographic Data and Predictive Analytics
The rise of Big Data and predictive analytics will enable CRE decision-makers to make better informed decisions for their business interests. Developments in demographic profiling will provide insight into regions primed for investment. More sophisticated valuation methodologies, based on the availability of more data, can help CRE investors and owners make more data-driven portfolio decisions.
Deloitte predicts that the rise of Demographic Data and predictive analytics will have a high impact on location strategy, brand strength, and tenant strategy for CRE owners.
To read more about how to prepare for the city of the future, read about how smart cities empower an agile workforce.