Five Trends Making Smart Building Technology a No-Brainer for Real Estate Investors
17th Aug, 2015. Posted In:Building Technology By:rghi
Facing pressure to manage costs, risks and energy consumption, commercial building owners and investors are exploring how smart building technologies can help a company’s triple bottom line (people, planet, profits). Five key trends are making smart buildings a “no-brainer” for commercial property owners and investors, according to Jones Lang LaSalle’s latest report, The Changing Face of Smart Buildings: The Op-Ex Advantage.
“Commercial and public property owners are looking to smart building technology to boost operational efficiency, achieve energy savings, improve capital planning and reduce their carbon footprints,” said Dan Probst, Chairman of Energy and Sustainability Services at Jones Lang LaSalle. “These advantages, combined with tenant preferences for smart building features, provide a competitive edge for owners and investors.”
Five reasons for smart building investment
The report, which details the landscape for smart building technology, identifies five major trends:
1) Rapid return on investment (ROI). Smart building technology investments typically pay for themselves within one or two years by delivering energy savings and other operational efficiencies. Also driving the fast payback is the low cost of automated building technology, which has fallen as adaptation has increased. For example, intelligent lighting components that cost $120 four years ago today sell for just $50. Procter & Gamble’s building management pilot program, for example, generated a positive return on investment in just three months.
2) Operating-expense (op-ex) advantage. Relative to other energy-related building upgrades, smart building technology requires little upfront capital expenditure (cap-ex), while delivering significantly reduced operational expenditures (op-ex). Using automated systems, smart buildings generally cost less to operate than buildings operating solely on legacy systems, therefore offering a long-term op-ex advantage. By combining smart building systems and data analytics with facilities management, a smart building management system can detect and resolve building issues before equipment failures and capital expenditures ensue. Additionally, operational and energy savings begin shortly after the smart building management system is implemented.
* By the Rockefeller Foundation and Deutsche Bank Group’s DB Climate Change Advisors: ‘United States Building Energy Efficiency Retrofits: Marketing and Financing Models’