smart buildings; iot

Today’s building tech is not about gadgets; it’s about big data, and the key to unlocking that data is already in your building.

What new technologies are being implemented today in the buildings that form the skylines of the world? We asked industry leaders what’s next in the evolution of smart buildings, and everyone is pointing to big data. The big question is how to control it.

Mike Alexander, the associate vice president for sustainability services at Cushman and Wakefield, has his finger on the pulse of emerging building technologies as much as anyone. But he says the story of the year in building technology is not some flashy new gadget that no one has ever heard of. It’s a device invented decades ago and widely known to everyday consumers: the LED lightbulb.

Alexander says the last year has seen a massive increase in LED technology in buildings owned by the largest commercial real estate firms. And that’s no mundane development, he adds. It’s truly ushering in the era of “smart buildings,” which are vastly more energy- and resource-efficient than their predecessors.

“In the past, LED lighting was more of a specialty thing, but we’re now seeing a lot of projects doing LED retrofits on a large scale,” he says. “Even though the payback analysis was good two years ago, the up-front costs were still really high, so the sticker shock was holding people back. Now the costs have finally come down, so it’s finally here in a mainstream way.” Indeed, the original LED bulbs cost in the neighborhood of $100; these days, LED bulbs that cast an equivalent amount of light as a 75-watt incandescent bulb cost under $5.

Then there are the operational savings of LEDs. LED lighting uses about one-tenth of the energy as incandescent bulbs, and about half the energy used by compact fluorescent bulbs to produce the same amount of light. To put that in perspective, lighting accounts for about 18% of energy use in commercial buildings. So if the skylines of the world are now making the switch, it truly is a headline-worthy revolution in sustainability. But Alexander says the most exciting part of the picture is what comes next.

“The next phase of the LED revolution is tying [the lights] into the networks in the building, so you can use lighting to collect data in the building.”

Mike Alexander, associate vice president for sustainability services at Cushman and Wakefield

Because LEDs contain what amounts to a tiny computer chip, they pave the way for a host of so-called smart building technologies to follow them in any building where they are installed. In effect, a building lit with LEDs is a building pre-wired for all the sexy new “Internet of Things” technology that is quickly becoming available.

A recent Forbes article called LEDs the “Trojan horse” of the IoT, because sensors—motion, temperature, occupancy, and so on—embedded in LEDs could be used for applications ranging from thermostat and window blind controls in office buildings to smart parking apps in parking garages to smart labels on food products, where sensors are used to determine when grocery store items are past their best by date.

“The next phase of the LED revolution is tying [the lights] into the networks in the building, so you can use lighting to collect data in the building,” says Alexander. “LEDs draw so little energy that you can actually power the bulbs with an Ethernet cord, so eventually we’ll no longer need traditional wiring. Companies like Cisco have really got into the networked lighting solutions space—they’re starting to put sensors and communication tools and all kinds of things in light fixtures.

While technology companies are indeed developing mind-boggling applications that are starting to transform the built environment, Alexander cautions against overhyping the present-day possibilities, at least when it comes to the commercial real estate sector. For starters, he says with innovations like wiring buildings with Ethernet cables rather than electrical wire, “building codes right now are having a hard time stomaching that idea, so there’s a bit of a speed bump in getting the new technology deployed. We’re still in the learning phase.”

Another hurdle has to do with the fiscal reality of the industry—new technologies are inherently risky and have to be proven as financially viable before they’re widely adopted. “In commercial real estate we are very conservative,” Alexander says. “We want to be different than the next guy, but we also want to make sure we’re not the first guy to do anything. Everyone has their finger on the pulse of the new technologies, but owner-occupied buildings have more of an opportunity to take the risk. Commercial real estate owners want to wait until the risks are known and vetted.”

JLL Dives into the IoT in Real Estate

Risky or not, commercial real estate companies are inevitably involved in vetting new technologies—even if it’s just to provide the best possible advice to building owners and investors. Darlene Pope, senior vice president of energy and sustainability services at the Fortune 500 commercial real estate services firm Jones Lang LaSalle, says that while there are kinks in rolling out smart building technology, building owners are eager to do so because of the potential impact to their bottom line—which in most cases also equates to sustainability impact.

Pope, who oversees JLL’s Smart Building Program, says the company is already rolling out advanced building controls across its 3.4 billion-square-foot international portfolio. “As opposed to simply replacing light fixtures and putting in more efficient light bulbs, we are also layering advanced lighting control systems that can integrate with things like security and access controls, so the building is operating based on real-time occupancy information, as opposed to anecdotal information, or a time schedule, or people flipping lights on and off manually. All these systems can then communicate with each other through the Internet of Things—the IoT is now the major driver for building operations and building management, and it is creating a much more efficient workplace.”

The IoT approach goes beyond the efficiencies created by advances in hardware over the last several decades—more efficient HVAC components, for example, or better insulating materials—and uses software to program the building for next level efficiency. That programming can be for the physical components of a building—lighting, HVAC, and other mechanical systems—but it can also be for how the space is used. In other words, smart buildings aren’t just about cutting-edge technology, they’re about using existing technology to improve decision-making for businesses, which often translates to a reduction in resource use.

smart building; internet of things

Building leaders are just beginning to scratch the surface of what’s possible with big data—from fault diagnostics to more efficient HVAC controls.

Defining Big Data 

A Q&A with Darlene Pope, SVP of energy and sustainability services at JLL, on the nuts and bolts of smart(er) buildings

GBD: How do you define smart building technology?

DP: It is the web-based applications of IoT (Internet of Things) technology just like we are seeing in our cars, homes, hotels, and airplanes. It’s all around us—the challenge is how do we apply those same technologies in an office environment?

GBD: Ultimately that boils down to data collection, right? How is JLL collecting data on the buildings you manage?

DP: It’s not one specific technology. You can get that data in multiple ways, whether it’s Bluetooth, or RFID, or you use cellular technology to identify who is where when. Even when people log in on their laptops, you know somebody is there. The point is all these devices are connected to a network somehow, and that underlying network is what gives us the ability to collect data, send it up to a data warehouse, and then analyze and import that data to whoever needs it in whatever form they need it in.

GBD: What are some of the more exciting things that data allows you to do?

DP: You get the ability to drive business intelligence through the collection of all the data. It gives us the ability to correlate different data feeds with other data feeds. For example, do buildings with a higher EnergyStar score have a higher occupancy rate? Do buildings with lower EUI (energy use intensity) have better productivity numbers? There is a famous Harvard study on the impact of indoor air quality on cognitive function. By getting multiple data feeds we can now start to correlate what things impact other things.

GBD: Sustainability impacts the bottom line in many ways, and it sounds like Big Data is the key to quantifying that for building owners.

DP: Yes, we can correlate more energy-efficient buildings with higher rental rates, higher employee engagement and satisfaction. There are a lot of things we can demonstrate now. People have always said that green buildings are better assets, that they are more valuable than traditional buildings. Now we can actually pull that data and prove it.

To illustrate why using technology to better plan how building space is used, Pope and her colleagues at JLL have coined the “3-30-300 principle.” The average expenditure of JLL’s clients on energy each year is $3 per square foot; annual real estate expenses are about $30 per square foot, per year; and annual expenses for their workforce come to about $300 per square foot. What those figures make clear, says Pope, is that using less real estate per employee is where the greatest impact on the bottom line comes from. And by not lighting, heating, cooling, maintaining, or otherwise making use of real estate that isn’t truly needed, tremendous reductions in energy efficiency and resource use are realized.

“Smart building technology allows us to operate buildings based on where people are and what their immediate needs are for lighting and HVAC and things like that,” Pope says. “But we can also better advise our clients on how much space they really need. If they understand who needs what space when, they can actually reduce their overall real estate footprint by condensing more people into less space, or moving to more of a mobile workforce, or providing real-time booking of desks and conference rooms. It’s all about data-driven business decisions.”

Building Data Deliverables

Smart buildings rely on data collected from countless devices and sensors embedded within mechanical systems, computer networks, and other components found in any modern building—and even from mobile devices carried by employees, such as key fobs, access cards, and phones. But of course the raw data is useless without a way to filter it and pull out relevant information. So while smart building infrastructure is more and more commonplace—that is, the means to collect the data—and portfolio managers are full of ideas about what they want to do with the data, some of the most important new developments in building technology are those that translate raw data into actionable information.

Software programs to do just that have been flooding the market, says Robert Brierley, a BOMA Fellow and senior vice president of real estate management services at Colliers International, who mentions Building Engines and Electronic Tenant Solutions as two products he is personally familiar with. Brierley’s favored products are those that combine a broad array of building information on a single platform, or at the very least can “talk” to other types of software that building managers typically use.

“The products and technologies that are going to be the most successful at improving operational efficiencies are those that integrate and correspond with other software packages and programs,” Brierley says. “Many buildings have individual systems for a particular aspect of their operation, but that system doesn’t necessarily talk to, say, the accounting software package, or integrate with payroll, and things like that.”

Fault Diagnostics

Brian Capelli, vice chair of BOMA and vice president of operations for the Cleveland-based REIT Forest City, says the emerging technologies for monitoring building activity are revolutionizing the industry. One of the overlooked advantages, according to Capelli, is fault diagnostics—the ability to detect exactly where within an enormous property energy leakage is occurring. The IoT approach, where sensors are embedded in virtually all forms of building hardware, means building automation software can detect exactly where a component is deviating from its design parameters. In some cases, the system can auto-correct the problem; at the very least, the building manager is notified, and a work order is generated so the technician can investigate.

“In the old days, you would get a demand report from your utility company where you might be able to see your peak energy use during each day of the week,” Capelli says. “That was helpful—at least you could see on the weekends if your building was ramping down as it should when it’s not occupied—but it really didn’t tell you what was driving your energy use each and every day.”

Forest City has implemented smart building technology in several properties across its portfolio, with many more in the pipeline. Capelli says the company is seeing healthy 13% to 14% ROI on the new technology. “We are in the early rollout, but so far it has been a great investment.”