What does the Internet of Things mean in Real Estate Industry?
For the real estate industry, which relies heavily on raw materials like cement, concrete, steel, Internet of Things (IoT) may not seem very relevant to start with. But a little closer view reveals that Internet of Things (IoT) is radically changing the way things are done in the industry, with changing customer preferences driving demand and transactions. In the near future, businesses will see IoT playing an increasingly important role.
Disruptive innovations in the technology space are fueling the growth of smart real estate space. There is a huge advancement in devices and sensors that are being used to capture data. This is enabling commercial real estate providers to create differentiated value to customers by providing smart solutions to control various systems at homes, offices and the spaces they frequent.
IoT makes spaces smart
Customers are looking for more automated solutions to perform their daily chores that make lives easier. For instance, a smart HVAC system at home will sense the ambient temperature and the tenant’s schedule and automatically start before the tenant enters the home. This will help in enhancing the user experience and also help in efficient system operation, thus reaping better economic benefits.
Similarly, a smart security system will help ensure safety by sensing and analyzing regular activities in the house and notify the user of any changes or irregularities.
Significant impact on energy efficiency
IoT plays a key role in capturing the energy consumption pattern of systems and can initiate predictive maintenance to ensure smooth operations. It can be implemented to automate building maintenance services, enabling users to track operations of machines like the elevator, HVAC system and lighting system by collecting data like operating time, idle time, and maintenance cycle.
Along with the analytics, devices and sensors will record the pattern of operation and notify the need of maintenance whenever required, either in case of irregularity or in case of predictive maintenance. This can be directly translated into tangible benefits like operational cost reduction and intangible benefits like smooth operations.
IoT is helping in making decisions faster
Retailers are seeking smart spaces to capture the flow of customers. This will help understand the areas where customers spend the most time, which parts of the store get the highest attention etc. A better understanding of the operations will help the retailer to make decisions regarding the design of the store as well as merchandising.
Manufacturers and warehouse operators are also excited about the concept of smart workspace, which will help them to monitor the supply chain with a closer look into the inventory levels, people and machine performance on the floor.
IoT will soon be the only way forward
Today, the lack of interoperability of devices is not allowing businesses to tap the true potential of IoT. To achieve interoperability, there is a need for integration across various systems, devices, and vendors. There could be a threat of invading privacy due to the user data, which might lead to denial from tenants to implement IoT solutions. Commercial Real Estate providers should plan to mitigate the risk with appropriate measures.
However, IoT will seek more lure in the real estate value chain and will need huge direct and indirect investments. The Real Estate industry should plan to incorporate IoT which will drive the way businesses will operate in the future.