Commitment to smart building tech sustained despite subdued outlook
By Thomasin Crowley,
Wiredscore APAC
/ EdgeProp Singapore |
In an uncertain market, landlords realise that failing to engage with climate goals or deliver a best-in-class user experience is a risk they cannot afford. (Picture: Albert Chua/The Edge Singapore)
SINGAPORE (EDGEPROP) - Developers are still investing in smart technologies despite the downcast economic outlook, but some solutions are higher up on the agenda than others.
If there had been a recession five years ago, smart technology would have been one of the first features to be taken out of building projects to minimise costs. That’s no longer possible today, even with the current economic outlook.
At WiredScore, we are seeing this in our conversations with developers from around the globe, including in Singapore, and in the data we collect about smart buildings during the certification process. By following projects from design to completion, we have a powerful feedback loop that allows us to understand the maturity of particular solutions and the most popular use cases in different markets. It’s a small but statistically significant sample of the world’s best buildings — and there aren’t many better ways to learn about something than by following the people who are doing it really well.
We know that premium office spaces tend to hold their value better in a recession, and we can already see this happening. High-quality, energy-efficient buildings with in-demand amenities are still commanding strong rents, while demand for lower-quality space is declining. Today, smart technology is almost a defining characteristic of a prime office: it is what underpins that quality, efficient and premium, amenity-rich occupier experience.
Indeed, landlords who have invested in future-proofing their buildings via technology can expect to see vacancy rates drop by 3.8%, higher rents, and tenant retention growing by an average of nine months, according to a recently published report by Moody’s and WiredScore.
But while the landlords that we work with are committed to investing, they are not spending indiscriminately — they are laser-focused on the things that will maintain the value of their assets and attract tenants in a challenging market.
Sustainability solutions
Sustainability is one area that shows no signs of diminishing, with new regulations and growing social consciousness giving landlords strong incentives to engage. In New York, for example, Local Law 97 requires most buildings over 25,000 sq ft to meet tough new energy efficiency and emissions targets by 2024, and even stricter ones by 2030. Meanwhile, Sydney’s city council just voted in planning controls that will force new buildings and major redevelopments of over 1,000 sq m (10,760 sq ft) to meet minimum energy ratings from 2023 and reach net-zero by 2026.
A focus on sustainability is not diminishing, with new regulations and growing social consciousness giving landlords strong incentives to invest. (Picture: Samuel Isaac Chua/The Edge Singapore)
In Singapore, where buildings are responsible for over 20% of the country’s carbon emissions and accountable for more than one-third of electricity consumption, the government has set targets for 80% of new-builds to be Super Low Energy buildings that meet best-in-class energy efficiency standards.
It’s clear that regardless of market conditions, owners and operators know they need to invest to retrofit poorly performing assets and make new ones future-ready.
Future-proofing developments
One sustainability solution that is front-of-mind is metering. Believe it or not, a significant portion of buildings don’t have pervasive metering systems, and you can’t manage what you can’t measure. Smart solutions can extract data from systems and present it in a format that in-house sustainability teams can use to reduce consumption.
These newer solutions are typically easier and cheaper to retrofit, being mounted externally to a flow pipe and connected to an on-premise gateway. Information is then fed into a dashboard that shows performance across a portfolio of buildings.
To connect more seamlessly with leading providers including Lendlease Podium, Johnson Controls, Schneider Electric and Spaceworx in Singapore which provide these solutions, landlords have been participating in our Accredited Solutions programme to save them time spent doing their own research, as well as additional costs and resources often associated with procurement processes.
"By following projects from design to completion, we have a powerful feedback loop that allows us to understand the maturity of particular solutions and the most popular use cases in different markets," says Thomasin Crowley, global director of Apac at WiredScore. (Picture: Samuel Isaac Chua/The Edge Singapore)
Many landlords will take the next step and use advanced analytics to optimise building performance in real time. Today, this is largely rules-based, but we are seeing some early adoption of machine learning and artificial intelligence among our customer base.
Several have achieved the highest-possible energy optimisation criteria on SmartScore, which requires the use of analytics and optimisation without operator intervention. So far, we have only seen this grade of implementation in a handful of leading buildings; nevertheless, it’s definitely an area to watch.
Improving the office experience
The other driver of investment is hybrid working. It’s here to stay and, if we want people to come into the office, we need to make the space at least as appealing as being at home. We are seeing continued interest in things that improve the experience of buildings, from seamless access control to apps that connect people to community events or amenities like fitness classes.
Asset managers and operators of prime commercial buildings see smart technologies as a way of adding value for tenants and choice is a big part of that. A reason that people don’t prefer the office is that they don’t have as much choice in the way they want to work as they do at home. Smart solutions bring together data from disparate control systems to make buildings more transparent to users, empowering them to make more educated decisions about how or where they want to work — making the space as effective as possible for them.
Underlying this continuing investment is the fear of empty floors in a world where occupier demand and working patterns are changing. In an uncertain market, landlords are realising that failing to engage with climate goals or to deliver a best-in-class user experience is a risk they cannot afford to take — and they cannot do those things without technology.
Thomasin Crowley is global director of Apac at WiredScore
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