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future-proof real estate with the smart building collective
98 Plays1 year ago
Welcome to episode 063 of the Green & Healthy Places podcast in which we discuss the themes of wellbeing and sustainability in real estate and hospitality.
I’m your host, Matt Morley of Biofilico wellness real estate and in this episode we’re in Amsterdam talking to Nicholas White, Co-Founder and Managing Partner of the Smart Building Collective, a smart building and prop-tech business with its own certification framework focused on leveraging technology to measure how a real estate asset is performing.
It covers key metrics such as the building usage, its performance, the building environment, health and safety, user behavior and connectivity.
We discuss how a smart tech is at the heart of both sustainable green buildings and healthy buildings nowadays, as well as playing a role in real estate ESG strategies.
We also look at some of the more innovative real estate developments that he’s been a part of recently that give a sense of where the world of adaptable, smart and future-proof buildings are going.
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Transcript
Introduction
00:00:10
Speaker
Welcome to episode 63 of the Green and Healthy Places podcast, in which we discuss the themes of wellbeing and sustainability in real estate and hospitality today. I'm your host, Matt Morley of Biophilico Wellness Real Estate. And in this episode, we're in Amsterdam in the Netherlands, talking to Nicholas White, co-founder and managing partner of the Smart Building Collective.
Smart Building Technology and Sustainability
00:00:35
Speaker
That's the smart building and prop tech business with its own certification framework focused on how buildings, property managers, landlords and owners can leverage technology to measure how their real estate asset is performing over time.
00:00:51
Speaker
That framework covers things such as building usage, its performance, building environment, health and safety, even user behavior and of course connectivity. But we also discuss how smart tech is basically nowadays at the heart of both sustainable green buildings and healthy buildings, whilst also playing a fundamental role in real estate ESG.
00:01:12
Speaker
It is, in other words, fundamental to everything that this podcast, and at least my work, is
Innovations and Origins of Smart Building Collective
00:01:19
Speaker
about. We also look at some inspirational real estate developments that Nicholas has been involved in recently that give a sense of perhaps where buildings are going, and I can tell you they are adaptable, they're future-proof, and they're definitely smart. So here he is, Nicholas White from the Smart Building Collective.
00:01:40
Speaker
Nikos, thanks for joining us on the show. Amazing to have you here. You're dialing in from Amsterdam? Yes, I am. Thanks for having me. Cool. Listen, why don't we start with a little bit of the background, just to give a sense of the genesis of what you do with the Smart Building Collective. How did the whole thing start? What was the opportunity that you set out to focus and zero in on when you did this?
Transition from IT to Built Environments
00:02:02
Speaker
Yeah, amazing, amazing journey it's been. I think it was
00:02:07
Speaker
I came personally, I came from the corporate sector doing large scale IT transformation projects. We were attacking these from the human perspective, really change management, trying to help people maximize the usage of tech and getting the most out of it. And what was always quite disheartening was that corporates would kind of roll over their people in that process.
00:02:32
Speaker
which was quite painful to watch it sometimes. And so I thought there needs to be a better way. There needs to be a more engaging way, a healthier way to do these kinds of transformation programs. So I left the corporate sector and I teamed up with a woman by the name of Elizabeth Nelson and she was actually doing research into burnout and human performance and why do people do what they do
00:03:01
Speaker
you know, why are people falling over at work? And I was attacking it more from the practical side of working with leadership teams and working in corporate space to make things better. And then we got this amazing opportunity with CBRE to do a research study on the impact of the built environment on people.
Living Labs and Research Insights
00:03:22
Speaker
And we were like, oh my God, you know, of course we have to do that. That's just the most amazing opportunity ever.
00:03:28
Speaker
So we worked with them and they built a living lab cost probably about 250,000 euros to build. And then they started changing all of the things in the office environment. So they changed the plants and the food and the air and the light. They changed it all over the course of 10 months.
00:03:48
Speaker
And that was incredible. Like they would do cognitive tests on people to see what the impact was. And once you have that data, you could do those kinds of amazing research studies. So the results were amazing. And then when we left, it was kind of disheartening because that living lab died. There was no one there to continue the legacy of this tech and get more out of it.
00:04:13
Speaker
So it's like, okay, that's lesson learned. It took us a long time to build. It was quite expensive to do and then it
Establishing and Evolving Smart Building Certification
00:04:19
Speaker
kind of died. But the results, the research findings were incredible. They were really amazing. And then Elizabeth was asked to do it again with booking.com. And we did a huge research study here in Amsterdam that dictated their new headquarter plans, which was really quite cool.
00:04:40
Speaker
Same thing happened. It took a long time to build, expensive to do. Research results were amazing. The Living Lab kind of collapsed after the research study was done, which is looking back is completely logical that that happened. And then we did it again for GSK in the UK, GlaxoSmithKline. And then it was, okay, is there not a better way to do this? Where is there kind of a standard? And this was around 2018, 2019,
00:05:10
Speaker
Where is there a standard that we can just plug into and do research more effectively, more efficiently, and more collectively, actually? And everybody we spoke to said that's a really cool idea, but it doesn't exist. And then we kind of did some research of what kind of standards or certifications would emerge. We knew that something would.
00:05:35
Speaker
We came across some noise about the smart readiness indicator, which was the EU's approach to a smart kind of standard. And for the rest, nothing else existed. So we started to make the rumblings and start to think about doing it ourselves. And that's kind of what we did. And we launched in 2020 the smart building certification.
Smart Buildings in Green and Healthy Spectrum
00:06:01
Speaker
Okay, so let's go a level deeper, because I think a lot of people will have heard perhaps the term a green building, which is essentially a building that's designed to minimize its environmental impact, so it's sort of externally oriented. And then perhaps a healthy building becoming increasingly common as a terminology, perhaps more oriented internally, thinking about the impact the building has.
00:06:22
Speaker
on its occupants you just use the term smart building it's in your brand it's in your name it's at the core of what you do so how does a smart building fit into that spectrum of green on one side or on one side of the coin and healthy on the other how do you see that triangulation?
00:06:40
Speaker
Yeah, well, for us, you know, smart is it's technology, it's digitization of real estate. And for us, it's an enabler. It's nothing more than that. It shouldn't be a goal in itself to make a smart building. It's about the results that we're trying to achieve with that asset and then working back to think about, okay, how can we make that more efficient and easier to do and more real time? And I think that's where smart is really
00:07:07
Speaker
an enabler is that it gives us that ability to manage these assets in real time and evolve as we go.
00:07:17
Speaker
So it is essentially the tech component of both sides, because I know, especially on the healthy building scene, if you're not measuring it and monitoring it in the long term, you can't effectively justify the upfront investment that you put in. You need to keep an eye on what's happening. And pretty soon you get into some pretty deep conversations around tech and how you're going to see what's going on, right? And essentially that then almost
00:07:45
Speaker
morphs into from healthy into healthy and smart, if I understand right. Yeah. Yeah. And it goes beyond that, right? I think you have sustainability, you have health and well-being, but there's also efficiency gain through different management and maintenance of your asset, better user experience, which isn't just health. That's also human performance and culture and community and building a way for people to connect with each other and with the asset.
00:08:15
Speaker
You also have kind of new business models that are emerging from the enablement that tech provides. And that's really kind of exciting. And that's really future focused is what is real estate of the future going to look like, right? Because I think we all have heard the pressure that the commercial real estate is under with
00:08:39
Speaker
the changing of work, flex working, not flex working, you know, the whole discussion that's happening in between. But what's going to emerge? And I think when we have data and we have the ability to see what's working versus what's not working, I think you're in a much better position to make good decisions, make rational decisions.
00:09:01
Speaker
And you've created essentially your own framework that gives some structure to how you think about smart buildings. I think that's such an important piece of how you communicate your position and your, let's say, view of the real estate industry. So it's clearly at the core of what
Stakeholders in Smart Building Maintenance
00:09:23
Speaker
you're about. Perhaps you could just give us a quick overview of the component parts that make up your framework.
00:09:29
Speaker
Yeah, sure. So the Smart Building Certification, what we always are saying is founded in research and practice, and we're constantly optimizing it with our community. We actually made a change from the Smart Building Certification to the Smart Building Collective. We did that last year in August. And the reason for that is that as we were certifying buildings,
00:09:56
Speaker
We see that not a single one of them is similar. They're all completely different. And there's so many different ways to roam, I guess you would say, different roads to get you there. So the certification really is being informed by the collective, by the community. The smartest buildings we find and the smartest solutions we find
00:10:21
Speaker
are informing the benchmark and constantly changing it. So in a way you could start to think about it as a bit of a web three approach to certification in the sense that it is dynamic and it is moving and we're learning as we go about the best that's going on. But in essence, the certification that we have created starts with the result, right? Like what are we actually trying to do with these assets and then work back
00:10:51
Speaker
to the technology of how do we get to that result. And that result is broken into a number of different modules within the certification. And so I'll just kind of quickly go through them, I guess. I think that's probably the easiest way to do it. Because with smart building and real estate, we have so many stakeholders on table. We have so many stakeholders kind of pulling at it and different silos at play.
00:11:20
Speaker
We have to break it down into kind of chunkable pieces for each of those stakeholders. So the first module is building usage. How does one have kind of overview and control over how the asset's being utilized? So thinking about occupancy tech, thinking about how things are being, how amenities are being used, these types of things. So what kind of technology do you have in place?
00:11:49
Speaker
to understand how your asset is being used. The next module is building performance. Then you can really think about your sustainability aspects, your energy consumption, your water consumption, how the asset is actually performing against the goals and against the promise. We have a module on building environment, which is thinking more about your health and wellbeing.
00:12:14
Speaker
And it's really about your indoor environment being sound, light, air quality, these types of things that are, you know, how do we use technology to make sure that the environment is healthy and in state for people to use in a good way. And then we have a module on safety and security, of course, which is both physical security, but also digital. As you put more smart building, more technology into a building,
00:12:43
Speaker
We need to keep it safe. We need to keep the cybersecurity at the forefront. But it's also about physical security and disaster mitigation and these types of things. And then the last module is user behavior and collaboration. So how can people find each other? How can they interact with the building? How does community get created?
00:13:07
Speaker
And then all of those modules are actually brought together by a module we call integrative design, which is how can we actually, with the least amount of technology, maximize the value in the results in all of those different areas? Instead of having a technology for each piece, how can we make sure that the technology becomes a really integrative, designed aspect that adds value to all those different areas?
00:13:37
Speaker
And then I think one of the things that really sets us apart and makes it quite interesting actually is we have a huge emphasis on governance.
00:13:49
Speaker
process, access to data. Do the right people have access to the data to do something with it? And is the organization structured in a way that actually can do it? Because I think a smart building without actually using that data is, you could argue, is that smart.
Collaborative Efforts and Challenges
00:14:08
Speaker
Perhaps for anyone who's not aware of some of the intricacies of how that works then,
00:14:16
Speaker
you effectively looking at the facilities management the building management company that's looking after the building we're talking a fairly large scale say mixed use or office development on behalf of the tenant or on behalf of effectively behind that the investor or is it the tenant themselves who has some role and wants access to that and needs to be involved in the
00:14:35
Speaker
How does that structurally work in terms of who's monitoring and implementing these policies and maintaining them and keeping an eye on them because is that someone doing it on behalf of the tech company that's in the building or is it the tech company itself looking at that themselves? Well, ideally it's a communal effort. The whole idea is to break down silos and to be working together, right?
00:15:00
Speaker
forge better relationships between the owner and the property manager and the tenants and all of the different suppliers that are in there. And I think where the industry is right now, which is challenging, is that all of those things are being done in silo. Every single one of those different stakeholders is dealing with their piece of the puzzle, which in the end makes it quite a challenging situation to navigate.
00:15:30
Speaker
Um, so ideally, you know, the stakeholder map would be doing this, uh, together, but what we see in practice is that it's coming from different perspectives. Like we will do a certification for a tenant that is interested in understanding what their, their building is capable of doing for them from a tenant perspective, and they can use it to then.
00:15:53
Speaker
work with the landlord to say, Hey, from my ESG perspective, I need to have better energy consumption or a better insight into my energy consumption. These types of things. We also do it from a building owner perspective that says, Hey, I've laid in an incredible tech stack for, for my potential tenants and my property managers. How, how can we help them, uh, you know, understand that it's there?
00:16:20
Speaker
So with your certification level and with your communication and your training, how can I improve it? How can I make it better? And how can I make sure that we transfer that knowledge to the appropriate parties? So it's kind of coming from different angles right now, but I think the real hope for the future is that it becomes a language that more and more people can align on constantly.
00:16:48
Speaker
It's effectively tapping into this rising tide around awareness of ESG. I see it coming from above in terms of pension funds and investment groups.
00:16:58
Speaker
coming in and then applying pressure on the investors or the building owners, but also from below effectively, sometimes from the employees themselves and oftentimes from brands or in this case tenants of the building, right? Then having to say, well, look, we've got a pretty stringent ESG plan in place and we need the building to align with that. And so I guess in a sense you end up being that bridge between the two as the tide grows ever higher, right?
00:17:25
Speaker
Yeah, and you know, where we're at right now is just meeting people where they are, right? Like we have some of the most, you know, the smartest developers in the world who on one side want to help tell the world that they've created something really spectacular and something really special.
00:17:43
Speaker
At the other side, they want to say, OK, where are my holes? Where are my gaps? What am I not thinking about yet so that I can push the envelope for this development or my next development? And then you have people who are like, well, what is smart? How do I even start? Where do I begin? And that was one of the main reasons we pivoted to the Smart Building Collective is that
00:18:12
Speaker
We're not here to say this is how you build a smart building. The collective is informing this certification. And then there's a ton of people in this community that are there to help from all different walks of life with different culture, different views, different ways of supporting. And so you can find the solution when you're looking for it.
Developer Engagement in Smart Building Certification
00:18:38
Speaker
sort of let's say a minimum size that you're noticing in the market in terms of
00:18:44
Speaker
buildings and developers who are coming to you with an interest in going deeper into this. Oftentimes, you might see smaller developers, smaller building owners, smaller tenants who have increasingly aware of this, want to get into it, and then look at the breadth of big certification and just go, I can only do one or two elements of that. It looks like a big undertaking. We don't have the
00:19:09
Speaker
the manpower, we don't have the budget. How does smart fit in? Is there a kind of bespoke approach that one can adopt? As you say, just kind of get started, or is it all or nothing? And therefore, is it a certain size of building that makes more sense? No, it's definitely not all or nothing. It's, you know, start wherever you are, start small, start getting a little bit more control in different areas. And, you know, what's so exciting about the benchmark system that we've created is that
00:19:39
Speaker
It's moving, it's rolling, but it's also applicable to whichever asset class, whatever size, whatever type of property in whatever country, because what we are doing is actually starting to build sub-benchmarks, right? So if you are a building of 5,000 square meters, which is not that big, let's compare you to other 5,000 square meter buildings.
00:20:09
Speaker
We get the question, should I have a user app? Well, it depends. It depends on the context. It depends on what you're trying to do. It depends on the value cases you're after. What are you trying to accomplish with your property? And in that sense, you should really be compared to like-minded buildings and not to all of them.
00:20:32
Speaker
So a user app would then be effectively a smartphone integrated user phase where you can basically see what's going on around you in the building in terms of key data points and metrics, right? From air quality to, I don't know, light usage and electricity usage. Is that essentially what it does? Yeah. So, well, I mean, they come in all different shapes and sizes. A lot of user apps focus on the community aspects of a building.
00:21:01
Speaker
you know, what kind of workshops are happening today, what kind of events, what kind of, is there a run happening this afternoon with a group of people? Is there a concert ticket, that kind of stuff? Some of them go beyond the building itself and connect you to the community and the smart city space, you know, what's going on in the neighborhood. But you also see them as being utilitarian where, you know, they start to become the key to doors or
00:21:31
Speaker
the light switches for lights. And what you see is to get the utilization up of those apps. You start with the utility piece, you know, making if you can't open the door without it, then you're going to start using that app and then growing into that community aspect. We also see the app becoming kind of the full financial backbone of the building that it manages everything from room booking to, you know, to amenity usage.
00:22:01
Speaker
So there's, again, sky's the limit as to what you can do with that functionality.
Peer Review Process and Cultural Perspectives
00:22:08
Speaker
That's a big one. And around the actual certification process itself,
00:22:12
Speaker
How did the accredited professionals, your APs, how does that network of people who are basically, as I understand it, sort of been through a certain process of learning, studying what you're about, understanding the certification piece, and then they are then charged with being almost the front line in terms of assessing the buildings wherever they might be in the world? Is that how you've structured that? No, it's a little bit different than that. I think that would be kind of the traditional AP. Our certification comes from the world of academics.
00:22:42
Speaker
So when you research and you write a publishable paper, it always gets peer reviewed, right? So a scientific paper doesn't get published in the market until it's been peer reviewed. So we thought, shouldn't that be how we assess buildings? So we built a peer review model where you have independent assessors who are looking at this building. And those assessors come from different cultures,
00:23:13
Speaker
you know, parts of the world and they look at your building. And then what we have in the certification process is we have quantitative data and we have qualitative data. The quantitative data is very much based on, you know, do you have the technology? Do you have the functionality, the coverage? You know, is it there? And that's quite black or white, right? It's either there or it's not there. The qualitative data,
00:23:39
Speaker
is much more the grays that are going on in buildings, right? It's like your governance structure. How are you organizing yourself as a building? Your integrative design, how did you decide to build your smart building? Did you use one massive supplier for the whole tech stack that's really been around for 30, 40 years? Or did you use a bunch of startups and scaleups and have them work together, right?
00:24:08
Speaker
There's no kind of wrong answer there. You just make different decisions for different reason. And so there's definitely a qualitative piece that needs to be taken into consideration of, hey, this is what we see in buildings. This is the pros. This is the cons. Maybe this is something you should think about moving forward. And that peer review model has been hugely successful in the sense that
00:24:34
Speaker
These assessors get to, you know, assess buildings all around the world and they get to see the different cultures and the different ways that they're built. And it's become a really, really incredible community of people who not only are working together daily to find good solutions for their own work, but also helping inform the collective to improve the certification, improve what we do.
Future Trends in Smart Building
00:25:01
Speaker
Is there a particular building or case study that you've been through or been involved in in the recent months that has really stood out or could be sort of representative of where things are going or where things are at today in terms of smart building excellence? Yeah, there's been quite a few actually.
00:25:21
Speaker
And what's amazing is that, so the smart building certification, the way it's built is that you have a benchmark on total level. So you'll compare buildings to buildings on total level. But we also benchmark on those sub-levels. So all those modules that I just explained to you, we benchmark on those levels as well. And then we benchmark on the sub-level as well, even below that. So what you see is you see where buildings excel.
00:25:51
Speaker
where they do really well in one or two or three areas. And you see areas for improvement or opportunity for doing things even better. And so what we're seeing across the board with all these buildings is that every single building is excelling in one area over other areas. And sometimes they're excelling in one area over all the other buildings that we've certified. So in a way, the benchmark becomes
00:26:20
Speaker
kind of the best we've seen in every single area of the framework. But one that we just certified that is amazing is the Houseman's House in Oslo. And it's a family office that built this incredible building. And they did it very much from an altruistic perspective. They said it's not about building a smart building. It's about building the best building we possibly can.
00:26:50
Speaker
and it just happens to be digital. It just happens to have that digital infrastructure. And then they really believe strongly in kind of future-proofing it for the long term, making it flexible so that whatever happens in their tenant structure, whatever happens in the future of that building, they can kind of unplug and plug and work that way. So they created these
00:27:19
Speaker
smart grids throughout the building, which allows them to kind of, you know, configure the building that any way that they want for however big or however small a tenant would be, and give that
00:27:34
Speaker
small space or large space or whatever they decide to be, its own smart infrastructure, its own energy metering, its own light metering. It's completely kind of self-contained where a traditional building will take the energy of the building and divide it by the amount of square meters and here's your bill. It doesn't matter what kind of tech you put in your sockets.
00:28:00
Speaker
you're paying your equal share. And this is a completely more sophisticated way to do it. And then it's just the most beautiful, high-quality building. And one of the things that they did as well, which I think is something that I'm working with them to kind of spread the word about is, and I think it's very kind of maybe typical to that
00:28:27
Speaker
part of the world or that culture or that way of working. But what they have is they have kind of open, transparent contracts with their suppliers where they say, you know what, we're going to we're going to guarantee your margin, but we're going to discuss the cost. Right. And they originally thought that the budget of the smart building was going to be significantly higher because of all the smart tech and all these things.
00:28:52
Speaker
But by managing it in an open, smart, and transparent way with their suppliers, they've actually been able to create a building that's the same cost, which I think is just something we all need to learn because it's good business. That's all it is.
00:29:09
Speaker
There's a lot in there. I think there's a lot of the principles that you mentioned in these 27 minutes or so that are really actually just exactly that sensible approaches to delivering modern contemporary buildings in the best way possible. That happens also then facilitate minimizing your environmental damage or at least understanding what environmental impact you're having as a building.
00:29:30
Speaker
and being able therefore to reduce it and also to improve the well-being of the people in the space. It kind of does a little bit of both. It sort of is the underlying building blocks of that strategy, those strategies, I think. That's why it's so interesting. And when you look kind of a few years down the line in terms of what's coming, where do you see the business going? Where do you see your growth over the next, say, three to five years?
00:30:00
Speaker
I think that's a great question. I think that, you know, one of the things to hit on your last point, I think part of our role is that we need to get these success stories and these stories out, right? And we need to make them, we need to write these cases and we need to make them quantified and we need to really share how impact is really being made. One of the things that I think is happening now
00:30:25
Speaker
which is really interesting because I think if we look back three, four years ago, smart was still kind of this new term that was just starting to kind of emerge and now everybody signed on and we're getting, I think, buildings with more technology than is even needed, right? So I think we're going to get to this point of rationalization of, okay, what is the right level of technology for buildings and what's too far, what's not far enough?
00:30:55
Speaker
So I think there's going to be a fair amount of that. I think the emergence of having buildings be larger than themselves, I guess, being part of a community and not just stand alone. And you see that with co-working spaces and community spaces, these kinds of things. I think that that's going to be a huge component. We just certified a building in Finland.
00:31:24
Speaker
that has its own kind of geothermal energy plant that they built under the building. And it is now feeding the energy to the entire grid around that building. And it's starting to feed all of the apartment buildings and these types of things. And I think there's something to be said about being a global citizen with your project. So I'm really hoping to see more of those types of applications
00:31:53
Speaker
And yeah, hopefully real estate as a whole will just get better and better. And then, you know, I have the strong belief that out of challenging times, which the commercial real estate is definitely in right now, comes some incredible opportunities. And I think the emergence of cultural experiential experience type places,
00:32:21
Speaker
is emerging. And I'll be very curious to see how that evolves. So, you know, in a way, it becomes a completely different asset class, not a museum, not a concert hall, not a, you know, an office or a hotel type place, it becomes something completely different. And I think we're going to start to see more and more of those emerge because I believe that they're actually quite lucrative, the ones that do it successfully. So
00:32:49
Speaker
Amazing.
Conclusion
00:32:50
Speaker
Yeah, that's great. I think I think you're absolutely spot on. And it's a really interesting position, the one you've carved out for yourself. So congrats on all you've achieved so far. Thank you for your time. We'll link to the website in the show notes. Apart from that, you're particularly active on LinkedIn or social media. Yeah, yeah, LinkedIn, you can find us at Smart Building Collective. You can follow me as well, Nicholas White.
00:33:13
Speaker
Love to hear from you. The Collective is growing every day. And I think we hinted on the beginning. It's about sharing those stories and working together and working with fantastic people. And thank you so much for having us. This has been great.