Information and intelligence about potential and existing citizens, clients, and companies has always been valuable to commercial real estate and its local municipalities. Today, more than ever, that value increases when integrated with a Smart City network. In April 2016, Deloitte University Press released an article titled “Smart buildings: How IoT technology aims to add value for real estate companies” that discusses the impact of IoT on commercial real estate. While focus is on commercial, it applies to cities, universities and government properties as well.
We know the benefits — superior monitoring of energy consumption, water resources, waste management, parking and traffic, for example. Others are not so obvious. Workforce health and productivity, predictive maintenance, risk management, and of course, cost and revenue benefits realized when there’s full integration between building automation and IoT. Deloitte points out the benefits to the broader ecosystem:
“The IoT’s interconnected nature means that the value of the collected data is not limited to CRE and tenants — companies can link to the broader ecosystem as well. Connected buildings can drive meticulous tracking of information on sustainability initiatives related to energy, water, and waste management and boost efforts to reduce the impact of climate change. Further, sustainability analytics can help CRE companies decrease their carbon footprint, have more sustainable properties in their portfolio, and eventually differentiate themselves in the marketplace.
“In the case of energy, increased IoT adoption can imply more detailed and real-time monitoring of all devices that consume energy in a building and better connectivity with the smart grid. This would allow power utilities to enhance the efficiency of energy distribution and conservation.
“Likewise, in the case of water, different sets of information (such as lower rainfall or a pipeline burst) can potentially help buildings identify possible supply shortages and better plan their usage and overall water conservation. For waste management, sensors in smart trash bins can communicate volumes to help collectors optimize pick-up timings and appropriately plan disposal of different forms of waste (source here).”
With integrated IoT between city and developer properties comes cyber security issues. Deloitte’s Surabhi Kejriwal and Saurabh Mahajan write:
“The more the number of IoT-enabled devices and the greater the interconnectivity between various building systems, the more detailed and sensitive the data that will be captured. This is likely to broaden the attack surface for hackers, who would have more avenues to cause financial and reputational damage and even loss of human lives. Some recent data breaches show the extent of financial and reputational damage to the tenants from cyber intrusions through building systems, even when buildings are partially integrated. According to IDC forecasts, 40% of the information in the digital universe requires some level of protection, but only half of that data—just 20%—is protected.
What can CRE companies do to minimize the security and privacy risk that IoT technology presents? They can make several moves to become secure, vigilant, and resilient, as detailed in Deloitte’s Safeguarding the Internet of Things report, the source of the following steps:
- Use purpose-built devices or add-ons, rather than pre-IoT solutions. Rather than retrofitting or extending functionality of old systems in ways for which they weren’t designed, companies should strongly consider wholly new, secure BMS designed specifically for the IoT.
- Develop clear responsibilities for the players in your ecosystem. Rather than sharing responsibility across a diffuse ecosystem, players should understand and define where their responsibilities begin and end, and what they are responsible to protect.
- Establish a baseline of data. Viewing IoT systems more broadly and monitoring environmental attributes such as usage, location, and access could better enable enterprises to gather a broad enough scope of data to establish a baseline, helping companies to discern what is normal and what constitutes a suspicious aberration.
- Institute data governance. Enterprises should consider playing a stronger governance role by defining which data to secure, what it means to be sufficiently secure, and, by extension, which products meet that goal. Guidance around how data can be securely collected, used, and stored can help prevent unwanted breaches.
- Create loosely coupled systems. Ensure devices within an ecosystem are loosely coupled and resilient so that the failure of one device does not lead to widespread failure (source here).”
Smart Cities working together with real estate development could predictably increase the overall health, wealth and sustainability of their citizens and workforce. Is your organization working with others to develop a truly connected Smart City? The benefits are compelling.