The current situation will have a significant impact on the real estate industry. People lose their jobs, and many struggle to pay rent. In New York, around 40% of the tenants might not be able to pay rent. This has inevitably affected the economy, and many questions remain unanswered. How many will pay rent? How will the property owners manage the situation? Will they be able to pay their taxes? It is critical to find the answers to these questions as soon as possible, and we must also start thinking about what needs to be done in the future. But, to find out where you’re going, you need to know where you’ve been.
Digital disruption has already started
History has taught us that the market is never wrong, but we’ve seen examples in the past where people’s mindsets have changed, and the market has shifted in return. Take the environmental concern, for instance, which is a significant question for a vastly growing number of people in the past decade. Sustainability, brand value, and accountability became priorities in the boardrooms, and corporations realized they needed to act accordingly to keep their customers confidence. COVID-19 has already affected businesses to discover digital solutions, and the real estate market won’t be any different.
According to McKinsey, the real estate industry was already moving towards a digitizing transformation before the outbreak of COVID-19. As the virus spread, digital solutions and services have become paramount for tenants all over the world. This current situation has shoved the real estate market into a reality no one could predict. Still, it could also be that extra push the market needed to commit to the potential of digitalization fully. McKinsey predicts tenants to get more used to digital products and services, followed by increased expectations and requests. By taking a leap of faith, those real estate owners who provide a new experience by implementing IoT in their properties will be rewarded by their tenants. They’ll offer better conditions for their tenants, while also setting the bar for how we need to think about our buildings in the future.
For example, HVAC is one of the core systems in a building. By using IoT and making HVAC systems smarter, property owners could lower their energy costs. In these times, a smart HVAC system would also contribute to preventing the virus from spreading.
One issue has been what we call ‘sick building syndrome,’ where employees experience a lingering cough or illness that they cannot seem to explain. Many times this can be traced back to the air quality in the buildings in which they work, which can contain two to five times as many viruses and contaminants than what is outdoors (EPA).
IoT solutions would enable much better options to monitor the HVAC systems remotely. As a result, air quality gets healthier for the tenants in their apartments or the employees in their offices, and fewer resources are needed to manage the system on-site.
By making our buildings smarter, they’ll operate more efficiently, and we can remotely access our assets and machines from a distance. But, IoT solutions have the potential to contribute on a larger scale as well. With a digital twin, a data-driven replica of its physical counterpart, we can create digital representations of buildings or entire cities, that allows us to assess risks, review different scenarios, and explore options. For example, Llamasoft, a supply-chain analytics software company, is currently developing resilient long-term risk management plans using digital twins.
Sensative can help
With Sensative’s operating system for smart buildings and cities, Yggio, as well as Sensative’s Strips sensors, it’s easy to get started even though the circumstances are difficult. Yggio integrates many different kinds of data, whether it’s from legacy installed systems or new IoT technologies. Strips sensors have a variety of different functions, and their batteries last up to ten years – simply install and forget. By the time you need to install new batteries, this pandemic will be far behind us, and you’ll have experienced the value of making your building a smarter, more efficient, and more resourceful building than it was previously.
Some final thoughts
Although it’s difficult to comprehend, half of the global population is currently estimated to be in quarantine due to COVID-19. When this pandemic is finally over, the market will learn how to operate more efficiently and IoT will play a vital part in that process. If real estate owners acknowledge the current facts, understand that they can contribute by making homes, offices, and entire building smarter, we’ll be better prepared for another crisis in the future. And we will manage our building smarter in the meantime.
It’s been told so many times before, but a crisis really could be a possibility in disguise. Thanks to digital solutions, we will overcome the challenges that lie ahead, proving once and for all that digitalization is the right path to follow and that we’re setting off on the right course.