Leveraging Commercial Real Estate Software for Sustainable Development
Advances in digitalization and commercial real estate software are proving valuable for fostering long-term sustainability in the built environment.
The destructive effects of climate change are becoming impossible to ignore. In the last 12 months alone, the US has seen coast-to-coast impacts, with whole communities devastated by hurricanes and flooding in the East, tornado outbreaks in the Midwest, and, most recently, wildfires on the West Coast.
The catastrophes magnify the importance of integrating environmental sustainability principles across all economic sectors.
Commercial Real Estate (CRE) companies often perceive the adoption of sustainable practices as a checkbox at best and an unnecessary expense at worst. They envision having to relocate tenants while costly upgrades are made to their property’s facade and envelope.
However, digitalization and purpose-built CRE software can also deliver significant sustainability benefits without painful construction and tenant displacement. Research shows that leveraging these technologies can reduce an existing structure’s carbon emissions by up to 70 percent.
This article explores the role of proptech software solutions in advancing sustainability objectives within the CRE industry.
Understanding Sustainability in CRE
Sustainability concerns in CRE cover a broad spectrum of factors, including energy efficiency, carbon emissions, and waste reduction. These factors apply not only to new construction projects but also to the renovation of existing buildings.
According to the World Economic Forum, existing buildings are responsible for nearly 40 percent of global carbon dioxide emissions, and 80 percent will still be in use in 2050.
By prioritizing sustainability, CRE stakeholders can reduce operating costs, increase asset value, and attract tenants.
Leveraging Technology for Sustainable Development
Commercial real estate software is central to furthering sustainability initiatives within the CRE sector. From initial design and construction to operations and management, CRE software offers innovative solutions to improve efficiency, reduce environmental impact, and enhance the tenant experience.
Building Design and Simulation
Design and simulation software tools make it easier for architects and engineers to optimize a building’s layout and systems to maximize energy efficiency and tenant comfort. Simulations of different design scenarios and performance metrics enable designers to see ways to reduce energy usage and carbon emissions. They can also experiment with options for improving indoor air quality and maximizing ventilation and natural light.
Smart Building Automation
Connected sensors, smart meters, and building management systems (BMS) give building engineers and property managers advanced ways to monitor and control energy usage, HVAC, lighting, and water consumption in real time.
AI-powered tools analyze a building’s data streams to rapidly identify patterns, watch for irregularities, and highlight ways to optimize operations. They enable building operators to tweak system performance, predict maintenance needs, and adjust for changing occupancy patterns, weather conditions, and other variables.
Energy Management and Renewable Integration
Energy management platforms track, analyze, and optimize energy usage for a building or an entire portfolio of properties. By combining these platforms with electrification initiatives and green energy sources (e.g., solar panels, wind turbines, and geothermal systems), CRE property managers and owners can reduce their utility bills and contribute to decarbonization efforts.
The AI algorithms powering these platforms assist in optimizing renewable energy generation, storage, and distribution, ensuring seamless integration with grid systems.
Predictive Maintenance and Asset Management
Another task where AI software adds value is anticipating and preventing equipment failure. AI and machine learning algorithms facilitate predictive maintenance by constantly analyzing historical data, sensor readings, and equipment performance metrics to anticipate breakdowns, optimize maintenance schedules, and extend asset lifecycles.
By helping CRE stakeholders address maintenance issues proactively, commercial real estate software minimizes downtime, reduces repair costs, and improves tenant satisfaction.
Commercial Real Estate Software Risks
As with any other software solution, CRE platforms have risks that need careful mitigation to keep buildings and tenants secure.
AI-enhanced data security platforms help secure systems against intrusion. In the same way AI can improve preventive maintenance, it can constantly monitor system access points for anomalies and thwart attempted breaches.
Data Privacy and Security
The CRE industry does not typically handle the same types of data as other industries, such as the financial and healthcare sectors. This makes CRE businesses less of a target for cybercrime. However, as buildings and their systems become more interconnected, they present more opportunities for cybercriminals.
It’s important to recognize the full impact of a data breach. If an attack exposes tenants’ personal information, the property owner is open to lawsuits from everyone impacted. That means not just the tenants but also their employees, vendors, customers, and clients.
Tenant Safety and Security
Criminals taking control of a building’s systems is a favorite trope of Hollywood, going back to 80s classics like Die Hard. However, these kinds of attacks can happen with today’s connected digital systems. By breaching a building’s systems, criminals could impact tenant health and well-being, much like those celluloid villains.
An attack of this nature could result in damaged or stolen tenant property and inventory, or reduced productivity. For climate-controlled buildings storing temperature-sensitive products, a disruption of the HVAC system could ruin a tenant’s entire inventory.
In retail properties, a shutdown of building systems could mean tenant businesses would have to close. For high-rise office buildings, disabling elevators and stairwell lights for an extended period would make tenant offices inaccessible, particularly on higher floors.
Reputational Impact
When data breaches and criminal disruptions occur in a commercial property, the landlord often gets the blame. Tenants want to know how it happened and if it could have been prevented. And they will almost always expect compensation for their losses.
The harm to the CRE owner’s reputation could considerably impact their ability to attract new tenants. They may be forced to undergo expensive rebranding or even sell the business to new, untainted owners.
Data Recovery and Repairs
Restoring data after a breach or a ransomware attack can cost thousands. Even if the landlord pays, criminals seldom return all seized data, and what they do return is often corrupted. In the worst cases, building owners may need to hire engineers to rebuild the entire system.
Properly backing up all system data can help mitigate these costs, but even then, it could take days to restore all system functionality.
Legal Trouble
In addition to the costs of lawsuits from individuals and companies whose data was accessed without authorization, the property owner could face substantial regulatory fines. These lawsuits often take years to resolve, which takes landlords away from focusing on building the business and other valuable activities.
The Future of CRE Software
Commercial real estate software and AI are powerful new tools for sustainable CRE development. The technology’s ability to deliver data-driven insights, automation efficiencies, and predictive analytics allows CRE owners and managers to optimize resource use, enhance operations, and reduce environmental impact to help meet their sustainability goals.
As AI matures and becomes more central to these solutions, it will position CRE stakeholders to better navigate sustainability challenges and mitigate the risks to their investments.
Taazaa can help. We’re a custom proptech software development company that builds secure, robust solutions tailored to your business and property needs. Learn more about our commercial real estate software services, or contact us today to get started.