In the last article I wrote about how Web 2.0 was changing the way companies market to and interact with their customers, and continuing with the theme of technology affecting real estate, this time I'm going to discuss the "Internet of Things" and its im
The Internet of Things is a technology trend where everything has embedded sensors and is attached to the Internet and automatically communicates with other machines.
This means not just traditional personal computers, tablets and phones, but everything, including your refrigerator, washing machine, lights, electric meter, water pump, air-conditioners, door locks, parking spaces, waste disposal, outside lobbies and corridor.
A house or condo will soon become a highly sophisticated machine in a complex resource-management network that constantly monitors and manages living and common spaces to improve efficiency and comfort.
Gartner, a US information-technology research and advisory firm, projects that by 2020 there will 26 billion machines connected to the Internet and automatically communicating with one another.
The benefit of this could be tremendous. A recent test in San Francisco of a light-sensor network in a parking lot showed savings in electricity consumption of 30-50 per cent.
The availability of these smart sensor networks in every aspect of a building means that fundamental redesigns are needed based on how the usage of energy, water and waste and the interaction with and by people can be differently managed.
There’s no doubt that the Internet of Things is going to transform home systems, building management, building security and even things such as the designs of rooms, common areas and parking areas.
Now, why should we as a developer or you as a customer care about stuff that may be three to 10 years away? Well, we build properties with an expected use of more than 30 years, and as a buyer of real estate you probably expect to own your home for a similar length of time, so these trends matter.
And it’s not just a matter of adding some more cabling or a few extra wireless routers.
It affects the very fundamentals of how people live, what they expect from a living space and building, what they already own in the rest of their life that interacts with their home, and how a building needs to function to meet the needs of its occupants and how it needs to be designed.
And it should be easy to see that if you buy a property in a building that hasn’t been designed to take into account these future tech trends, you’re going to be left livin in an obsolete building, unable to meet its residents’ needs and with far higher common-area service charges.
It means your property is going to be harder to sell and worth less than a building that was better designed. If buyers already own smart fridges and are used to smart deliveries, how popular is your property going to be if it can’t offer that?
If buyers are comparing smart-network buildings with high energy efficiency, how popular is your property going to be if the monthly maintenance charge is twice as high for a fraction of the services?
If you’re trying to sell a building with a parking lot that can’t manage networked and automated vehicles, how are you going to sell it when everyone owns an automated vehicle?
It’s still early days but we’re already trying to plan and predict the impacts on real estate over the next few decades from these trends, to protect and enhance investment returns for our customers.