Smart Buildings

Workplace Optimization Solutions Proliferate as the Commercial Real Estate Sector Undergoes a Seismic Shift

This article was written by Daphne Tomlinson of Tomlinson Business Research. The Commercial Real Estate industry is undergoing a major shift as new business models and changes in the nature of the workforce disrupt the sector. Changes in the way we work are forecast to transform not only the workplaces of startup companies but also large office buildings and their occupants. With Millennials (the generation, born between the early 1980s and early 2000s) predicted to make up 50% of the workforce by 2020, workplace connectivity, mobility, flexibility and choice have come to the fore. Individuals based at home or in remote offices, scattered anywhere in the world, are part of a rising phenomenon known as distributed working. Increasing numbers of freelance workers are contributing to this trend. The rise of more flexible co-working options for these workers, initiated by startup companies such as WeWork, has created more competitive pressures for landlords of commercial buildings and […]

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This article was written by Daphne Tomlinson of Tomlinson Business Research.

The Commercial Real Estate industry is undergoing a major shift as new business models and changes in the nature of the workforce disrupt the sector. Changes in the way we work are forecast to transform not only the workplaces of startup companies but also large office buildings and their occupants.

With Millennials (the generation, born between the early 1980s and early 2000s) predicted to make up 50% of the workforce by 2020, workplace connectivity, mobility, flexibility and choice have come to the fore. Individuals based at home or in remote offices, scattered anywhere in the world, are part of a rising phenomenon known as distributed working. Increasing numbers of freelance workers are contributing to this trend.

The rise of more flexible co-working options for these workers, initiated by startup companies such as WeWork, has created more competitive pressures for landlords of commercial buildings and established real estate service firms.

In its recent Workspace Reworked Report, JLL predicts a seismic shift in the demand for co-working spaces with up to 30% of corporate real estate portfolios comprising flexible space by 2030.

As digital natives and digital dependents enter the workforce, user experience in the design of office environments will be paramount. To meet the expectations of the next generation and boost the
productivity of those using the office, a greater variety of spaces will be available to work in with increased connectivity and more personalization.

Activity Based Working

Activity based working (ABW), an approach to creating workplaces that provide users with shared access to spaces for individual and collaborative work, will become commonplace in workplace design. ABW has been adopted by many businesses to reduce the inefficient use of space in office buildings and reduce real estate costs.

Most offices worldwide are around 50% under-utilized at all times, due to changing work styles, mobile technologies, and changing business needs. Rather than assigning individuals with a single allocated desk or cubicle for all tasks, ABW recognises that different work activities can be better supported by spaces and features designed specifically for a task.

The jury is still out as to the effectiveness of this concept for all workers, although it has clear benefits for those who use multiple workspaces. Businesses in Australia and the Nordic region have been early adopters of this concept, with mixed results. A recent Australian survey found that this style of working had a range of outcomes, many of which were negative. A recent Leesman survey of ABW businesses and their employees was also inconclusive in its findings.

Workplace-as-a-Service Platforms

One company of many aiming to disrupt established CRE business models is Convene, whose ambitions are to transform Class A office buildings into full-service, “lifestyle” hotels with their workplace-as-a-service platform providing on-demand solutions for commercial landlords and their tenants.

The N.Y. company originally started out as a developer and operator of full-service conference centers, but has since broadened its approach. Convene is also developing a proprietary, cloud-based, “smart-building” app for building occupants, connecting tenants to the building’s infrastructure and on-demand hospitality services. The company raised $68M in a Series C funding last week, bringing their total funding to-date to $119.2M.

“The way we work has changed forever. The rise of co-working is just the first step in a major industry shift,” said Ryan Simonetti, CEO and Co-Founder of Convene. “The most progressive companies are looking for the next-generation of workplaces – ones that not only provide improved lease flexibility but also seamlessly integrate physical space, hospitality services and on-demand technology into the overall experience."

Emerging Technologies for the Office of the Future

Technology will enable and facilitate such changes to workspaces and we are already seeing a myriad of facilities optimization technologies and IoT solutions focused on the Smart and Agile Office sector and its occupants.

There are an increasing number of cloud-based space management software solutions, facilities analytics platforms, integrated workplace management systems (IWMS), indoor positioning tools and location based systems addressing real-time space optimization, wayfinding, meeting room / desk booking and occupancy analytics.

As emerging technologies, such as AI and augmented and virtual reality have the potential to address property and facilities management applications, key players are enhancing their capabilities not only through M&A, but also via strategic partnerships and technology venture funding. More recently, some companies have established test facilities for collaborative innovations to be explored in a laboratory environment.

For example, Brookfield GIS, a leading real estate services provider, has established a Building Digital Workplace Virtual Lab, in which they will experiment with Trimble technology and Microsoft Hololens. Pilots at the Building Digital Workplace Virtual Lab will focus on areas such as real-time holographic visualization of critical maintenance workflows, context-related operational data overlaid in the physical space, Building Information Modeling (BIM) integration and remote real time collaboration.

Trimble Manhattan™ IWMS software is currently used by Brookfield GIS as the single technology platform in their properties and the Manhattan data will be displayed in a mixed-reality environment, enabling greater visualization and streamlined work processes.

Another example is ISS Germany, a leading player in facilities management services, who has opened a new headquarters in Düsseldorf, called The Lab. The offices will serve as a laboratory for the 200 head office employees, partners and customers to use and develop cutting-edge workspace and service solutions.

Driven by Internet of Things technology and artificial intelligence, services at the new head office aim to create greater consistency and transparency around the workplace experience, including digital car park management, face recognition at the entrance, digitally supported catering applications and concierge services.

Occupant Based Solutions

A range of technology solutions focused on occupants of office buildings are focused on issues such as indoor air quality, noise pollution, lighting and thermal comfort, all of which can be detrimental to the productivity, health and wellbeing of employees.

Apps are becoming commonplace to support occupants of office buildings in a range of situations, for example:
* Personalizing lighting and thermal comfort at individual workspaces.
* Providing feedback to facility managers on building operations and maintenance tasks.
* Enabling desk/ room booking, wayfinding and proximity based access through secured doors and workspaces.
* Helping occupants to attain their health goals whilst in the workplace.

As the Internet of Things continues to infiltrate office buildings, ultimately we still do not know whether these invasive, all-powerful systems will be accepted by the occupants themselves. However, the upcoming modern workforce is likely to demand, and function best within such intelligent workspaces. The Smart Office is here to stay.

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