By Kundai Nyakuvambwa & Henry Gurajena
A smart building is a facility that performs independently and almost mutually exclusively of human interaction (Schor, et al, 2009). This would include reacting and adjusting to environmental changes to maintain adequate working conditions within the facility when humans are present either during or after normal working hours. Yang (2001) argued that Intelligent Buildings entail that buildings can be equipped with a high level of technology that allows decisions to be taken without manual intervention.
Smart sensors and controllers are now routinely incorporated into the design of building engineering services, allowing energy use to be managed more efficiently. A degree of autonomous control can thus be used to create and maintain an internal environment for the safety and comfort of users, and to monitor and secure the immediate surroundings. Smart system are building automation systems that uses the latest technology to improve on building operation for example, electronic sensors and information technology installation (Snoonian, 2003).
The spread of technology has been facilitated by the benefits that accrue to an industry’s products which include cost reduction and improved efficiency. The real estate sector has not been unique as it has embraced technology so as to improve the quality of the built environment. For the past thirty years, green buildings have dominated the real estate industry and the green building concept has spread due to it cost effectiveness and sustainability attributes.
However, due to the increased desire to continuously reduce operating costs, the intelligent building concept has been developed. This concept puts more emphasis on building autonomy and adaptability. The resultant product is a sustainable, efficient and adaptable structure with improved performance and value. With the spread of the intelligent concept’s benefits, investors are caught within a paradox of which is the best way to adopt the concept within a portfolio faced with two options, retrofitting existing building or coming up with new construction projects vis-à-vis limited resources. It is high time that Batswana commercial building investors move towards the intelligent building concept since smart systems in security, fire, lighting and air conditioning systems are desirable.
The merits of an intelligent building can be linked to various operations of a building but the bottom line is that the concept is a cost reduction measure. The intelligent building concept can bring benefits to various stakeholders in real property which are investors, property managers and tenants. The intelligent building is an advantage to the investor in a property since it enables him or her to achieve the primary objective of investing in real estate which is guaranteed returns in form of rentals (Himanen, 2004). With an intelligent building, an investors’ property portfolio’s performance is enhanced because of the increased competitive advantage that the building will have relative to other properties. Due to the increased need for tenants in the 21st century to keep pace with changes and or improvements in technology, space in a smart building will therefore be easy to market since it will satisfy tenants’ need for technology (Kabori, 1990) Also in modern day life of business, brand image and status quo of the business are very significant factors in the success of any business. These space in which a business operates from determine significantly how customers and partners perceive the firm. Thus to maintain a good brand image, most high profile business organization want to be housed in the most modern offices and this will mean low void levels, which then translates to better performance of the portfolio as a whole.
In addition, since an intelligent building reduces operating inefficiencies within building operation, it means the total operational expenses of the building will be reduced. This is highly beneficial to tenants. This cost reduction will attract more tenants to the building and void levels will be lowered since every rationale tenant will run for a cheaper space so as to maximize utility but with minimum cost. Such a scenario makes the life of property managers easier since their job of looking for tenants will be made simple due to self-selling space (Menassa, 2011). Also with a modern technologically advanced and efficient building, the bargaining powers of a property manager will be improved in negotiating for rentals. Striking better deals in rentals will then benefit the investor in the sense of an improved value. Value of commercial buildings is determined by capitalization of rentals with a certain predetermined yield. Thus the higher the yield, the higher the value of the property. Hence the investor will benefit from an increase in the value of the portfolio as whole.
Moreover, due to the ability of an intelligent building to communicate, it helps prevent catastrophic accidents that occur within commercial buildings. For example an ordinary commercial building, in most instances the fire equipment that is installed is to fight a fire or detect a fire like smoke detectors, sprinklers, alarms and horse reels (Mills, 2011). These are aimed at reducing the damage caused by fire in a building. However, with an intelligent building, it considers that not only fighting or minimizing the damage is important but it values that the fire must be dealt with before it even breaks. Sending a signal through a computer system to show signs of short-circuiting is one way a smart building will try and prevent the breaking out of a fire. Thus it is a merit that an intelligent building can help prevent disasters before they happen and this will save investors and tenants’ costs in terms of property damages.
Further, an intelligent building enables integration of individual tenant’s needs into the already built up infrastructure. A smart building is built with facilities that provide for internet connection for the whole building and each and every tenant that comes to the building will simply be added onto the bill and connections are availed. Unlike in conventional commercial buildings where each tenant has to come and fix in his cables for facilities like telephone and internet to mention a few. This will also benefit the investor and the property manager due to the intactness of the building due to absence of regular dig ups of walls and other areas.
The major disadvantage of an intelligent building is the cost involved in setting up such an infrastructure. The materials and equipment fitted in an intelligent building is so expensive. Intelligent buildings are very complex systems which require very expensive machines and material to link up (Meredith, 1998). Also it also needs a team of highly specialized experts to install and service the system. This will then erode the fact that the intelligent building is cheaper when it comes to operating costs since tenants might be called on to pay for the costs, depending on the terms of the lease agreement. Thus an intelligent is costly to both tenants and investors.
Intelligent buildings have been seen to last less than conventional buildings. Conventional buildings last longer because most part of the building is brick and mortar. Whereas with intelligent building are fixed with high-tech equipment with shorter life spans (Nakib, 2010). This is a serious disadvantage to an investor because the investment will last less hence his period of enjoying returns from the building is limited.
Also due to the complexity of the systems, the implication of that is that a simple failure on a single component of the system will cause a disturbance of other systems that may not have failed or having problems (Braun, 2007). For example, to deal with a failure in the heating, air conditioning and ventilation system, a technician has to probably cut the whole systems to that this is attended to. Unlike in conventional building where the repair of air conditioning system will not cause the security system to be cut for so time. This is a major drawback because a malfunction of a single unit might mean a certain business entity will be affected as the systems will have to be cut.
Older buildings in Botswana suffers from ever increasing operating cost, high void levels and obsolescence. This is a result of the old designs and age of the buildings which comprise of old systems and technologies which are now obsolete and are becoming expensive to maintain. Thus the buildings are due for retrofitting and in the process, the incorporation of intelligent building aspects is deemed necessary so as to curb the rising bill of property outgoings today and in the future. Vantage Properties can give sound advice on intelligent buildings and retrofitting older buildings.
Contact us on firstname.lastname@example.org for sound real estate consultancy.