Implementing IoT Technology within a Real-Estate platform model
The rise of the Internet of Things (IoT) has propelled us into a new information age in which data is now king. Businesses are beginning to collect, store and utilise data generated from smart, network connected devices in increasingly intelligent ways, which has created new opportunities also within the real-estate industry. The most effective business model to realise the benefits of the information age is now a platform model.
As well as being the most effective, a platform model is also the most logical model for a property owner. They have access to the property and infrastructure where smart technologies can make a real difference in the home and at work. Tenants are also increasingly demanding technologies that’ll make them more efficient in their daily lives. Furthermore, property owners have the funds available to implement such technologies from rent and fees.
And the technology exists. Device manufacturers in every industry, from healthcare to home appliances, are now racing to create and sell the most effective connected technologies, each sparking an IoT revolution in their own sector.
However IoT devices are not commonly utilised in the current real estate model, despite the increasing hype around the efficiency benefits. It is clear then that IoT suppliers require more active support in this field to achieve mass adoption.
There are two reasons for this. Firstly, the majority of home IoT appliances, from washing machines and fridges, to smoke alarms and physical security, are installed by the property developer or owner before a tenant moves in to a property. This means that selling these devices to consumers is less effective than selling them in bulk to real-estate developers, which is a more complicated task.
Secondly, to function properly IoT devices must be connected to the internet. This allows them to communicate with other devices, as well as to consumers’ mobile devices and computers using ‘protocols’, or data exchange standards. This provides an easier way for consumers to connect the products in their lives, but these must be open systems for this to work for the tenant. A closed IoT device, for example one that only works with products made by the same manufacturer, creates a barrier for the consumer regarding what they can use and how simply it can be installed.
This lack of mass adoption has led to IoT technologies not being integrated into buildings and real-estate. But there exists an opportunity for real estate owners to both facilitate the large-scale adoption of connected devices during the initial development and building upgrade cycles; and to help consumers, with the support of an IoT platform partner, to integrate their connected devices across different protocols.
This would result in a more seamless experience when utilising connected devices, whether as part of working or living in modern buildings. It is clear that, from the real estate owners’ perspective, the IoT represents not just a natural development of a building’s value, but also a special partnership opportunity to improve the quality and performance value of a building.
That said, it is worth noting that this opportunity is not the same as real estate owners simply adopting IoT implementation and integration. It is instead another platform opportunity: where real estate can exploit its governance of its own asset, and access to tenants, to facilitate a large-scale implementation across the range of IoT devices by service suppliers.
The missing piece when thinking about implementing a real estate platform model is having an IoT service integrator who takes the responsibility of both sourcing and qualifying IoT suppliers, as well as helping tenants integrate different IoT products into both their home and working environments. That is why we have proposed the following important operational questions relevant to IoT platformisation:
- Asset management – how should IoT devices be integrated into a physical asset, whether at the building, apartment, or office level?
- Services management – treating IoT provisions as a ‘service layer’ of the property, which IoT ‘service’ categories are most valuable and relevant? For example, safety, health, cooking, space management, lighting, sound, energy? How should IoT-based services be managed and integrated and by who?
- Tenant management – how should IoT services be presented to and managed by tenants, and with what support from third-party partners, if any?
- Data management – what are the key information flows associated with IoT use, how can these be managed and leveraged correctly, and otherwise integrated with a secure data development model?
In answering these questions, it will be possible for real estate owners and IoT service integrators to realise the benefits of intelligent, connected technologies in the real estate industry. The IoT works at the level of the individual, generating new and large information flows which involves significant amounts of private data. This means that IoT platform development should be evolved alongside data management capacity.
By Christoffer Börjesson, CDO Fastighetsägarna Sweden