The idea of identifying and incorporating technology at the beginning of a commercial project solely for the purpose of improving the tenant experience is now trending. Traditionally, developers have been more focused on building the space at cost effective margins and then let the tenant do whatever they want with it. This of course saves developers the hassle, time and money of predicting the tenant’s needs and wants. However, the market is changing and its change is outpacing stagnant dispositions of key industry players. What is known is that developers are going to need three things in order to be competitive: smart spaces, smart design, and smart tenants.
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Smart spaces are the result of technology now being felt in even the most remote areas. These smart spaces are physical environments decked out with technology to enable humans to interact with integrated technological systems. It’s not something of the future, it’s already here. Smart spaces are being used in connected homes, offices and communal workspaces, hotels, libraries and especially in transportation stations such as airports. All of these spaces are using technology to improve safety, convenience, entertainment and productivity.
Smart Design in this context is the incorporation of big data into the decision making process of commercial real estate projects. Over the past 20 years, commercial real estate has evolved. Before, it was largely conducted in a Wall Street style bet system. Developers used their best guesses to choose what to build and where, owners set rents based on what they thought they could get and corporate real estate teams operated buildings to parameters that they hoped were efficient.
Today, that has all changed. Now that data is easily collected, stored, and distributed in massive amounts of quantity that it would take some computer systems hundreds of years to process. The effect of such big data being distributed is that it has changed how we make decisions. With better geographic, demographic and psychographic data, it lets developers identify exactly which type of building, what quality and what size an area needs long before starting construction. While competitive rent and occupancy cost data is not always readily available, it can be found with research and experience. Data pools let landlords maximize their income while also letting tenants tap into the available information to ensure that they are getting a fair price before they sign a lease. Big data is beneficial for both tenants and developers. It’s a win-win situation.
For tenants, big data compliments a variety of building systems with smart space such as HVAC, fire/life safety, utilities, telecommunication and other maintenance features where optimization of processes is essential. In ideal situations, it can be used to alert a tenant to an equipment failure before it happens. This allows them time to perform maintenance or source a replacement with minimal downtown. Using smart devices and appliances that are digitally connected to the cloud, constantly sending and receiving information, make the data gathering process possible. For developers, big data allows prediction of complementary technologies to incorporate at the beginning of a project in order to have it ready for tenant use.
With the change in how humans interact with design and technology, developers now need to change the way they approach the tenant experience.This can be done by attracting Smart Tenants. A Smart Tenant is a company that desires predesigned smart spaces. The main reason this is favorable for developers is that it tends to go hand in hand with forward thinking companies. Forward thinking companies also tend to be invested in the future which means lower turnover rate and longer retention lifespan. If you don’t mind having a tenant that just wants four bare walls and a door, there are plenty of those spaces that it would be hard to set yourself apart from.
There is now growing demand by developers to work with project managers that understand how to incorporate the tenant experience at the beginning of the project. This is in stark contrast to current practice of conceptualizing it at the end when everything has already been built. Desirable tenants are especially keen to want these specially designed spaces because it can improve personal and professional productivity, increase energy efficiency, simplify complex processes and potentially make daily life for workers easier and less stressful.
Staying on top of trending technologies and how to use them to your advantage is no easy feat. After determining that the tenant experience is a top priority, understanding what combination of technology to use in each project is overwhelming at best. Which is why it’s important to either work with a project manager who has a strong technology knowledge or outsource to a specialist with a specific knowledge in tenant experience.
To be competitive in any new project, remember to identify and incorporate technology at the beginning of a commercial project. Spend the time to find a project manager that has the updated skill set to identify quality smart devices and icloud support that is in line with the smart space design. Don’t get caught up as another victim of the sudden shift in industry practices. Use the data available and find the right people to help leverage the tenant experience to your advantage. You can do this by making ground decisions with smart spaces, smart design, and smart tenants.