5 reasons to invest in smart buildings
Smart buildings feature technology solutions to help efficiently and cost-effectively use resources, while creating safe and comfortable environments for their occupants. The benefits of smart buildings are far reaching, including these five reasons investors should consider:
1. Improve net operating income
Employing a smart building approach offers a number of benefits for investors. First, it improves your net operating income (NOI). Smart buildings support increased rents and reduced vacancies. You can maximize first impressions with well-managed, human-centric digital amenities that help differentiate the space. Things like simple, easy-to-access systems, clean buildings, and socially conscious and sustainable spaces elicit positive emotional responses that can make a building more attractive to tenants. Strategically delivered services—like an intelligent building controls platform, mobile-enabled services, and more accurate billing for utilities—can also reduce the amount of work for a tenant’s real estate team, which offers more value.
2. Reduce operating expenses
Smart buildings can help reduce operating expenses by changing the dynamics of how they operate. With smart buildings, landlords save on asset lifecycle costs because they don’t need to spend as much time, resources, and budget maintaining the building and its physical components and equipment lasts longer, which also improves their carbon footprint. In addition, utilities are more efficient because smart buildings use external inputs (e.g., occupancy data, weather data) to pinpoint equipment run times that match demand. This results in less waste with reduced energy and water usage. Overall, utility, maintenance, and staffing costs are lower because building analytics and virtual systems help identify problems before they occur.
3. Increase revenue and attract high performers
The features smart buildings offer draw higher rents, so you can increase your asset revenue. Plus, smart buildings tend to attract higher-performing property management teams, who are well versed in data-driven operations.
4. Meet compliance goals
Smart buildings can help you meet compliance goals and support your sustainability strategy. For example, using reporting and visualization to monitor your utility efficiency. You can align with your organizational net-zero targets and climate change mandates as well as streamline your energy, waste, and water reporting. This is essential because manual methods are slow, inconsistent, and prone to error. In addition, decreasing your energy consumption leads to less carbon emissions, so you can reduce your carbon footprint.
5. Maximize tenant experience
A premium tenant experience helps building owners and operators attract the best tenants. Smart buildings help reduce friction by offering a tech-enabled experience. From reducing steps and touch points to providing directions for accessing the building, space, and amenities, making tenants’ lives easier and providing safe, secure, clean, and comfortable spaces pays dividends. For example, dynamic cleaning uses smart technology to focus janitorial resources when and where they are needed the most. This enhances employee well-being, aligns with sustainability programs, optimizes costs, and increases operational efficiency. If investors don’t recognize the value of a premium tenant experience, they may not be on par with other assets in the marketplace, which could lead to more vacancies and less income.
The correct approach to smart building development is to start by defining the use cases and outcomes you want to enable in a building. Ultimately, making your buildings smart can have a significant impact on the value of your property.
Want to learn more? Download our Smart Building Essentials handbook and watch our Smart Buildings: Where’s the ROI? webinar.
