What is it about certain commercial buildings that can command higher rent and attract high-end companies as tenants?
In today's long overdue age of digital transformation, commercial real estate owners and property managers are finding that investing in smart building technology is critical to meet tenants' new and increasing demands for financial upside. Plus, it is one of the most straightforward strategic implementations to complete.
Let's explore why certain commercial buildings can command higher rent, what is so enticing about these spaces, and how they are investing in technology to upgrade their commercial buildings to generate revenue.
Digital, Yesterday
Real estate needs to be digital right now. Not tomorrow, but yesterday. That's because digital is all around us.
How many devices do you use each day? Between mobile phones, laptops, voice-activated home devices, car infotainment, and smart watches, options abound.
But which device can you not live without? The mobile phone.
People check their phones an average of 58 times daily for everything from communication and entertainment to planning and paying. By the end of 2024, we're expected to be on our phones around 4 hours and 39 minutes daily. That's why smart real estate leaders and property managers are embracing smart building digital solutions to stay relevant and meet the demands of people and their communication styles of choice. These smart building products help improve human satisfaction and automate and streamline operational tasks.
Simplified access, experience, and space operations workflows enable people to seamlessly manage and move between spaces in their workplace and across buildings - downtown, in the suburbs, or somewhere in between. Enabling users with self-service work orders, visitor registration, and more enhances security, improves comfort, increases efficiency, communicates better, and personalizes the human experience. This level of speed, convenience, and seamlessness delivers for tenants and occupies a space faster. Not to mention, these digital spaces command 37% higher rents.
Demanding Experiences With Lasting Impressions
The most in-demand spaces are utilizing smart building technology that allows real estate leaders to operate their spaces more efficiently for people through digital management tools. Automation elevates back-office operations from mundane to monetizable. Employee productivity is improved, energy usage is more efficient, spaces are utilized better, and HVAC and lighting systems run as needed, all contributing to notable cost savings. And because of the automation, there are staff savings to reinvent tried and actual roles from front desk to concierge for a heightened digital-first experience. As part of Cohesion's Smart Maintenance solution, our customers saw 56% decrease in staff operating (by sq. ft.) their buildings and 42% reduction in operational staff to people in the office. While this might sound harsh, it's reinforcing the value of elevated person-to-person interaction. A PwC Study found that U.S. consumers did not believe that once technology became advanced, we wouldn't need people for great experiences. We're now operating in a world that demands more value from each interaction, digital or human.
The Money Spaces
Smart building digital management tools are the secret weapon that assists experiential transformation. With quantifiable data and actionable insights, property managers and owners can be more proactive in addressing peoples' needs, improving the quality and speed of decision-making in building operations and space utilization. While most rely on delayed system reports to look back and make a call, artificial intelligence (AI) is essential in planning ahead, Predicting Occupancy, and designing spaces. In fact, more designers are doing away with loss leader amenities like game rooms in favor of wellness pods. And the savviest buildings know that future-forward insights are more valuable than historical data.
Visibility and prediction mean the difference between an unoccupied space and a revenue-generating one. In addition to an improved tenant experience, investing in technology also delivers enhanced revenue opportunities for owners. By connecting systems, physical access weaves through each touch point into a seamless, integrated, and reliable digital experience. Smart buildings command more rent, upwards of an additional $2.00 per square foot. Combining that with other aspects of the building experience that can be integrated into one connected system, like parking or optimized air quality, and revenue-generating opportunities start to grow.
The Glow Up Means Less, Not More
While the knee-jerk reaction is to add more to make the building attractive, the opposite is ideal. You need to add more by streamlining, integrating, and connecting building systems into a single pane of glass for management and insights. You're finding ways to save and invest where it means most for tenants and occupiers, and deliver on a one-stop, elevated experience that wins in the digital workplace. And provides insights and comfort to owners, operators, and occupiers.
