A Look at IoT and its Affects on Property Management

By now, unless you have been living under a rock or off the grid, you are used to the “internet of things” touching virtually every aspect of your life. Your smartphone is smart because of the internet. Your car provides you with directions through its GPS using the internet. Your refrigerator may even be able to tell you what groceries you need the next time you are at the store!

But have you ever thought about the effect the internet of things has on commercial real estate and the changes that it brings to the manner in which asset managers conduct business?

Property managers and changing technology

Manufacturers have long recognized the benefit of integrating various production and management systems through the industrial IoT. These artificial intelligence systems allow for just-in-time ordering of parts, warn their human counterparts of potential difficulties in production lines and stop the line, and integrate production with office functions, automatically invoicing clients for products once they are shipped. Such integration saves time and money in manufacturing.

This type of integration is now available in commercial building management through the use of AI for those property managers who understand the changing technology environment.

“Smart systems” – those that can “talk” to one another – have been around for decades in building management. AI takes smart systems to a new level. Through AI, the system itself can make appropriate choices in heating, cooling, and the allocation of other valuable resources to greatly improve cost-efficiency. And these decisions occur without human interface other than equipment and technology maintenance.

Tenants will demand more technology from their commercial space

Gone are the days when a commercial tenant needed only a solid landline and a reliable internet connection to process payment. Today’s commerce moves at the speed of light, both from the vendor and the customer point of view. Landlords would do well to keep up with the increased technological demand.

Newly constructed commercial space can design AI elements into the building plans. Older buildings must adapt as best they can to meet changing tenant needs. Not only are retailers using more bandwidth to manage business, accept payment and run websites, but consumers are also using online devices while shopping to comparison shop or simply stay in touch with friends and family.

As a result, top-speed, reliable Wi-Fi may well be the deciding factor for retailers in the coming years.

Cost/benefit analysis is key to determining implementation

While the benefits of AI and IoT are clear, such benefits do not come without a price tag. The benefits include lower cost of ownership through smart building maintenance, the ability to charge higher rents for higher tech retail spaces and the ease of accepting payments and holding real-time discussions with tenants through a variety of electronic devices.

The costs vary according to the size, age and condition of the rental property. Obviously, a newer building already contains components of becoming an AI building. Your 200-year-old Victorian Bed and Breakfast, however quaint, is likely not as compatible for today’s technology.