“In the 21st century the technology revolution will move into the everyday, the small and the invisible.”
– Mark Weiser, 1952–1999

If the supply sign of your washing machine lights up yellow, signalising that you need a repair or a change, you are benefitting from one of the basic concepts of the “Internet of Things”. A sensor registered the sudden or accumulating change in an item, like in your washing machine. It then sent the corresponding data to an analyser that analysed them based on a programmed logic, and communicated its findings. The washing machine consequently informed you of the need for action.

Data about the conditions and changes in an environment can be collected and then aggregated and communicated temporally and spatially. This enables us to work out future actions from the results of the data analysis. At the beginning of the 1990s, Mark Weiser described “ubiquitous computing” as the vision of a world in which not only washing machines but objects of all kinds, equipped with computer-like devices, can communicate and process data to eventually generate added value for other objects and users. The term Internet of Things – or IoT – is specifically used when the implementation of this idea especially involves physical objects (the tables in a room, the southern façade of a building, a pump or bicycle racks) that use the Internet as their backbone for data exchange about their condition, position or other characteristics.

This description is an aspect of our future that will shape our daily lives. Not because of one single technological progress, but rather due to the step-by-step technical developments and improvements that have reached a stage that offers reliable solutions suitable for everyday use.

Almost all implementation models of IoT implicate a concept of small, cost-effective, robust and communicative system parts that are scalably integrated into devices or objects and can exchange data relevant for their function. “Wearables” can for example send biometric information to the control unit responsible for visual and thermal comfort in a room, continuously adapting the lighting mode and energy balance of the environment to human needs.

In real estate management, buildings equipped with IoT applications can make use of their potential in terms of management, space utilisation and energy efficiency in such a way that this can lead to a clear differentiation of the real estate value on the market. In real estate, decisions are based on detailed knowledge of the property’s condition. Knowledge results from the evaluation of the information and information is the result of data processing. The example in Table 1 demonstrates how collected data leads to possible decisions.

Table 1. From generated added value from the data to decision options

*The limit can be defined in the programmed logic.

Data recording enables to monitor the success of the selected decisions. This closes the circle of value-added generation and optimisation.

Knowledge of the technical building operation and of real estate management is of great importance in the value chain of IoT applications in the real estate sector. The more detailed, complete and up-to-date the data is, the more reliable and suitable the resulting information will be. This will allow to improve findings and create a strong decision basis for the real estate.

If the execution of part of the decisions can be automated, the responsible devices (called actuators within the context of automation) or the responsible persons are contacted to implement these decisions. Automated processes reduce error rates, avoid forgetfulness and make room for creativity, are solution-oriented and focus on decisions.

The application of IoT in the real estate sector includes:

  • Improved space and portfolio management (efficient workplace distribution, real-time data on vacancy rates, automatic integration into ERP and sustainability programmes, reduction of burglary risk)
  • Reduction of operating costs and increase of sustainability in operation (predictive maintenance, spatial and temporal energy supply in line with demand, continuously optimised system control and automatic fault diagnosis)
  • Increasing user satisfaction, productivity and tenant loyalty (direct feedback, improved interior conditions, increased thermal and visual comfort, early weather warnings)

Technological progress may change the basic idea that the value of a property is determined solely by its location. Information-based services offer opportunities for added value, increased returns and other competitive advantages.

What does this future – in which we partly already live – mean for real estate, sustainability and energy consulting companies? How can the sector position itself within this technological progress? What are the new value creation opportunities, and what sources of income could they possibly eliminate? These are the topics of the next article in this series.

Ref: Weiser, Mark (1991). “The Computer for the 21st Century”