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Episode 30 – Part 3 – What is the future of buildings – commercial and residential? with Dan Drogman, Smart Spaces
65 Plays1 year ago
In part 3 of this week's episode with Dan Drogman we're discussing what is the future of buildings, both commercial and residential?
Dan Drogman is a software development entrepreneur and CEO of Smart Spaces. He provides leading owners and developers of real estate with smart building solutions.
Smart Spaces enables building owners to add an extra dimension to their services via its internet of things cloud-based platform, smartphone app and digital twin, giving clients 360-degree engagement with and control of their office environment. From a secure automated entry system with Apple Wallet functionalities, to control of lighting and heating, and connecting with the office concierge, the technology is revolutionising the role of the traditional building owner and occupier.
In part 3, we cover:
🏦 Smart building technology and its impact on property valuations
🧑🎓 WiredScore or SmartScore accreditation to get an advantage with peers
🌍 Smart building technology and its adoption in different countries
🔐 Smart building security and IoT vulnerabilities
📺 Technology and obsolescence - is it an issue in buildings?
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Transcript
Future of Buildings: Technology Integration
00:00:00
Speaker
So for part three we're looking at what's the future of buildings both commercial and resi and trends and so on so I think what we'll start with first to tie in with part two was as a surveying firm or as a surveyor are you seeing certain firms moving
00:00:17
Speaker
with tech much more effectively and driving benefits from that, or are you finding generally a scenario where survivors still need to explore? I think it's actually probably tilted towards more embracing technology and not. Definitely like one back five years ago, it was like a small minority of early adopters, but now I think it is more than 60% at least, which is fantastic. We've seen a lot of really forward-thinking, open-minded survivors throughout COVID.
00:00:44
Speaker
Come find us learn about products i have the luxury of the time to do so but then take that back to the classes that we think we can improve our building of c-savane quite a wide range of different roles within serving so the ones we tend to embrace the most of the agents so showing off a first class user experience access to the app.
00:01:03
Speaker
showing off all the immunity the building has, how sustainable the building is but then you've got the MEP surveyors who are looking at designing the engineers that are looking at the efficiencies and so they're getting the data back out of the buildings and analyzing that and actually as a designer you've now got the ability to see whether your design played out how you thought it would.
00:01:25
Speaker
You can look at the historical data and say, right, actually, we projected this, but it's not actually work that we thought. And so you're far more well-informed for the future. And then you've got the bit that sits outside of what we're doing so much, but valuations and so
Impact of Smart Tech on Valuation and Leasing
00:01:40
Speaker
on. There's so many fantastic SaaS platforms out there that you can leverage to help with your calculations and so on. So yeah, I think you really are not going to survive in the future without embracing technology.
00:01:54
Speaker
You don't have to be necessarily passionate about it. I think those are passionate about it or excel. But yeah, I think you can't ignore it. And I think embracing it, you'll certainly get a return on investment. Just slightly off piece, but the evaluation part you just mentioned, do you find that landlords or property owners that have invested in smart tech and smart buildings, do those buildings generally have a high valuation at the end of it?
00:02:22
Speaker
Yeah, they do. Because they're leased, yeah. It's because they're leased, you know. What we're seeing, you know, is there's a correlation in our data across what level of smart you've obtained. So are you smart score platinum, gold, silver, certified? And how much that building is leasing?
00:02:39
Speaker
And don't just think that it's our technology, it's not, it's because they've invested in every part of that building. It's platinum in its finishes, it's platinum in the way it's been designed. They've just really invested the time to think about it, make the product relevant.
Smart Tech in Due Diligence: A New Standard?
00:02:54
Speaker
market it effectively and so yeah those buildings are leasing they're getting big and you know funny enough you keep talking about flexible leases and stuff and certainly that is growing enormously but a lot of our big buildings in London have got 15 year leases we've got one building they've just got a 25 year lease you know so
00:03:12
Speaker
there's still some really good clients out there willing to commit to these buildings and obviously that goes straight into the valuation. Some more interesting things we've seen is we had one building sell and it had a smart score rating, it hadn't been rated yet and it had sold mid-rating.
00:03:30
Speaker
and we were the technology vendor and they had to make a commitment to the new purchaser that it would be leased a gold or they would pay to get it to a gold and fortunately we managed to get it through as a platinum so the client buying it was chuffed the client selling it was chuffed but I've been talking about this a lot with my clients recently and I genuinely think when people do due diligence in the future
00:03:51
Speaker
They're not just going to want to ask for your accounts, your leases, and the length of the leases. They're going to look at occupancy data. And they're going to say, OK, this company might have this building for 25 years, but best they're occupying at 10%. There's still a good chance they're going to want to leave or dispose of this asset. And I think
00:04:09
Speaker
that will start to become a must have. You know that it's not, oh, we don't have that. Sorry, we didn't invest in smart tech. It'll be no, we must have that data.
Learning AI and Smart Tech for Surveyors
00:04:17
Speaker
And so I think we're going to see the outcomes of smart technology in terms of the data sets that come into investments and evaluations.
00:04:26
Speaker
Yeah, I think that does make sense, actually, because it suddenly shows the value of that property in a very different light to just what people have paid in the past. It shows the engagement and the willingness to put percentage down a longer lease and that type of stuff. Yeah. A lot of our clients are already using this in their CRMs actively, especially on the flex market where the lease lengths are so much shorter. They will look at that data and say, right, we've leased this 30 person office and it's only ever got eight occupants and it's got a break beginning next year.
00:04:56
Speaker
we should probably go back and start talking to them now because we could probably take that back from them, move them into a 10 person. They're happy. We've then got another 30 person office to put back into the market rather than waiting until they break. And then, yeah, it's a bit too late because they've already committed to another location nearby. Having that intelligence and being proactive is really powerful.
Global Trends and User Experience in Smart Buildings
00:05:17
Speaker
My last question then on the surveying surveyor side, because I know I took a slightly away from that, is if you're,
00:05:25
Speaker
interested in learning more, whether it's about how smart buildings work or just the sort of AI side generally, you mentioned about surveyors that potentially use AI and chat GPT and will be 30 to 50% more productive than peers. Where's the best place to start with that? Because I think it can be quite daunting. You can log on to chat GPT, create an account and ask it a couple of questions. But how do you move from there to,
00:05:53
Speaker
to really drive in the benefits of me how to start writing proposals through it and so on. Is there a good place to start? Yes, certainly. There's a guy called Anthony Slumbers who's an expert in this domain and he runs a really good course for real estate professionals and you would come out of that course
00:06:09
Speaker
with knowledge that you could deploy immediately and get the benefits straight away. So I seriously recommend that. The other thing I would from a smart perspective is become a wide score or smart score, accredited professional is a very straightforward, accessible exam that you take. So it's a training course plus an exam, and it really helps you define smart and understand smart. And so yeah, and it would really truly, both of those would give you
00:06:35
Speaker
a huge advantage with your peers out there. So that'd be my two key recommendations.
Adoption Speed of Smart Technology
00:06:41
Speaker
Another one, if you're really seriously interested, we could arrange a tour of one of our buildings. So anyone who's listened to this, obviously reach out to yourself, me and Matt can take you around and showcase what building's like in real life.
00:06:56
Speaker
Yeah, I think they're really good bits of advice there, because I think it's, I've seen quite a few things in the past, which is, I should definitely learn more about this, but actually, you get excited and you want to go and do it, and that's where do I start? Suddenly, it becomes quite daunting at minefields. Yeah, they've written two easy measurable things that you'll get a return on, and yeah, they're well-rounded courses on both sides. Can't recommend them highly enough.
Smart Buildings: Standardization and Goals
00:07:21
Speaker
Awesome, awesome. I'll take a look at myself, I think. Yeah, that should be fancy. Great.
00:07:25
Speaker
I suppose my next topic within this is trends, I suppose. So under sort of what is the future of buildings? What changes are you seeing globally? Because you obviously mentioned that you're dealing with properties around the world, not just obviously UK. Are you seeing certain countries engaging with this much more and adapting it much quicker? Or is it similar across the world?
00:07:51
Speaker
Yeah, it's really interesting. From an energy perspective, Australia has always been ahead of the UK. Obviously, the neighbours racing come from there. So there's a lot of technology around optimising the energy consumption in the building that's been around for a long time in Australia. But I think from a user experience perspective,
00:08:08
Speaker
the UK and especially London and a lot of the other cities, you know, we're in Birmingham, Manchester, Bristol, but London has sort of, has been the trailblazer there. And so we find that all of these clients we have internationally
Security in Smart Buildings: Challenges and Solutions
00:08:21
Speaker
in the USA, across APAC.
00:08:25
Speaker
across mainland Europe, they're all coming here. They all come here, look at the case studies, how we've deployed the technology, and then they deploy it in their own countries. And actually, if they're quick enough, they tend to be the smartest building in their city when they take the technology home. But it will get commoditized over time, unfortunately. We'll continue to invest in the next generation of smart technology to keep us ahead.
00:08:49
Speaker
That's a good point. You said they're quick enough, but they'll be the smartest. What's the length of time from saying I want to go ahead and implement smart building technologies and actually putting it in place? A slightly open question, because obviously it depends how long is a piece of string, how much do you implement, but is there a typical time frame?
00:09:06
Speaker
Yeah, I think it does come down to what you have in your building. So if you've been really lucky and you've had a really good MEP designer that understands smart and he's put open interfaces throughout your building, he's got mobile compatible readers and mobile compatible access control system lifts and so on. You could deploy this in a month.
00:09:28
Speaker
That's how quick you can do it. But you typically find you don't always get all of those systems. You'll have maybe the access controls capable, the lifts are closed protocol, so you need to get an adapter to make it open protocol. The same for the BMS. But certainly in our history of smart spaces, we've been really lucky. We've gone to the building,
00:09:47
Speaker
we do an analysis, we provide a report to the client saying, look, this is what you need to purchase for upgrades, and we've gone green, green, green, green, green, you're ready to go. And so that
Tech Obsolescence and Sustainability Concerns
00:09:56
Speaker
means you can deploy as quick as like four weeks into the cloud, and then you provide your training and you've got people utilizing the platform. Okay, that's fascinating. On that note then, in terms of ease of deployment, depending on obviously what's in place,
00:10:14
Speaker
Do you think all buildings will move this way eventually? So all commercial buildings or residential buildings, or will it only suit a certain type of commercial building, for example? Is it something that will become mainstream everywhere? Yeah, I think so. I think the cost of technology is coming down all the time, so that makes it open to more people. You're going to have to do it because you're going to not be able to operate a net zero building without it.
00:10:38
Speaker
See, I really do think it will, I think it will become. And I think it's funny, people don't really refer to smartphones as smartphones anymore. I said, I use that term today, because I was referring back to 2008. But when we look at today, actually, I don't ever call that in my household. I go, why have I passed my smartphone? And so, yeah, I think smart will be baked into all buildings, and you won't even need to think about it. It's interesting how that terminology changes actually, because
00:11:17
Speaker
It stops you getting sold windows, which is good. Exactly. That's funny enough. One of my biggest bugbears at the moment is the amount of cold callers that we have across our phone system in the office, our 24-hour support desk out in New Zealand, our mobile phones. I've actually just gone for a therapeutic session of registering them at all for X directory because it's actually killing us. As the brand gets bigger, we're getting more notoriety.
00:11:31
Speaker
I know my parents still talk about, I'll call you on the mobile. And I'm like, I don't differentiate between landline and mobile anymore.
00:11:46
Speaker
we are getting hounded is it is distraction every day you're trying to drop this call and you know we like to think we're really friendly and polite in smart spaces you don't just hang up you know but then it you know we start a call that's just distracting us so yeah certainly a big bugbear of mine and but it's probably the main reason i never went with that airline yeah yeah i agree with that that's interesting that's changed i think as well but
00:12:09
Speaker
Yes, the rate of tech change generally has been fascinating. I touched on it before, is there a risk of a lot of this tech going obsolete and out of date or is that why people don't necessarily potentially invest in it? Is that the main reason people won't go ahead or are there other reasons behind it?
00:12:32
Speaker
Yeah, I think we haven't seen a lot go obsolete. We've been quite fortunate. I think your biggest risk error be sensors. I think sensors, depending on what they do, that that's where you potentially, and
Cybersecurity Imperatives for Smart Buildings
00:12:45
Speaker
what we've seen there is that, you know, some sensors come into the market to do a specific thing, but then someone else has adapted an existing system to do the same thing.
00:12:53
Speaker
which means you've got consolidation. You don't need to enhance that with a sensor. So a case study there would be that people now use like the WebEx cameras to count people in meeting rooms rather than use a sensor. And so over time, you might say, well, yeah, I'm not going to buy sensors anymore because my WebEx kit does that. So that's probably where we see that happening. But most overridingly, it's a good case in place like the new wallet technologies for accessing buildings. We can go back quite far with the existing reader technology
00:13:22
Speaker
than you would think. BMSs, we can go back eight, 10 years. So yeah, some of the core systems, not so much, but some of the more innovative sensors, certainly there were disruption there. But the benefit there is the costs coming down all the time.
00:13:38
Speaker
So actually what you start to think about then is more the sustainability angle and how these systems could be recycled and fortunately a lot of the providers now have methods for you to return the sensors and you pay a subscription rather than actually just pay for the hardware. So the risk is reducing all the time.
00:13:59
Speaker
something I've been saying even with consumer goods should be part of the process which is when you pay for something rather than it just being that's the manufacturer's end of obligation that actually that they if they have to take things back there's a they care then about the whole life cycle behind something whether it's a an oven or whatever it might be no sensor whatever it is. I think my final question is
00:14:26
Speaker
around the security aspect of it because there's two sides, there's probably the fear and then there's the reality. So is there a fear that people have around security? Because you hear about things in the home in terms of like internet things, IT devices getting hacked and all that type of stuff. Is that a fear on the one hand? And my other part of it was actually going to be, I imagine on the other hand, it makes security better in terms of it's easier to revoke access to buildings via the app than it is trying to get hold of someone's card again or
00:14:56
Speaker
people switching cards, that type of stuff. What's the perception and the realities around security with these types of things? Yeah, it's a really good question. I think the main thing is the design of the underlying systems that you're going to connect to the app. So I think where not enough attention has been paid to that in the past,
00:15:15
Speaker
that actually there's vulnerabilities even before you got anywhere near smart technology there's a whole host of vulnerabilities in a building and that could be a flat network where all your systems sit on one network so if I pop a camera off and I connect to my laptop I can turn all the plant off or I can control the lifts that you know we've come across that in buildings believe it or not and so we've had to then get the design network redesigned and a contractor in to adhere to the security principles there but then we've also
00:15:43
Speaker
I've seen that, yeah, plastic cars can be shared and you're enhancing security. So I think the element smart delivers is
00:15:52
Speaker
visibility of that. So you will see whether you have those vulnerabilities. You can monitor them, you can monitor who has access, but then you can leverage things like multi-factor technology or biometric to further enhance the security. So certainly smart buildings are more secure, but you need to have, but security is paramount. And so one of our biggest investments in our business is cyber security.
00:16:16
Speaker
I can imagine that's the paramount part but it's interesting I think yeah because I can imagine there'll be some people that have the fear of do you add more vulnerabilities in by going down that route but actually forget that that doesn't mean there are none to begin with you already have networks and systems in place that could or more likely to be unsecure as they are.
00:16:37
Speaker
Yeah, because you're not marching. Yeah, yeah, definitely. And then every time we connect to a legacy building, we see that, you know, you know, weak passwords, and so on. And like coming back to your IoT question, yeah, you know, we'd never put an IoT sensor onto the corporate network. It always sits in a segregated network. We typically use communication protocols that wouldn't be able to communicate with other technology in your space. And Laura Wang's a really popular technology for that.
00:17:08
Speaker
Most of it goes into the architecture and then it's the monitoring there afterwards. Yeah, that's really interesting and we've obviously focused a lot on cybersecurity as well in terms of our business and it's the big focus.
Connect and Explore Further Resources
00:17:23
Speaker
Often the realities and perceptions can be misaligned, horror stories versus actually what goes on and how it can make things more secure. Really enjoyed today's episode and going through the three topics. Thank you very much for coming on. If anyone wants to get in touch with you or smart spaces generally, what's the best way to get in touch?
00:17:42
Speaker
Best way is LinkedIn, so ever present on LinkedIn. And yeah, so Smart Spaces is how you find us on LinkedIn. And then our website is smartspaces.app, where you can find out a lot of detail around our platform. Yeah, it's a fascinating website. I'd recommend having a look. Perfect. Well, thanks for coming on. And hopefully we'll have another chat in a few months time and see how things have progressed. Brilliant. Thank you. Cheers.