| | FEBRUARY 201919City Councils - a city that has digital technology em-bedded across all city functions - to more data-driven explanations such as IBMs - `a city that makes opti-mal use of all the interconnected information avail-able today to better understand and control its oper-ations, and optimize the use of limited resources'. In future, Smart City technologies are likely to expand in scope and revolutionize areas such as healthcare, education and policing, while also supporting the growth and development of engaged residents capa-ble of understanding and utilising digital solutions and services (`Smart Citizens').Now, What do Smart Cities mean for Real Estate? The integration of Smart Buildings with various components like energy, technology, and others will bring multitude of benefits for the real estate indus-try, while redefining several long-standing trends and fundamentals.What are the expected outcomes?Data-Driven Real Estate Development: The in-creased availability of data will enable stakehold-ers to better understand a property or site, its sur-roundings and residents. This can be used to guide site selection, planning process and building design. Examples include an investor using foot traffic data generated by embedded sensors to inform its selec-tion of sites to construct new retail premises, or a tenant doing the same to lease a property. However, given privacy concerns, this could be challenging unless such data is provided by the Government as an open source.Smart Buildings' Competitive Advantage: Smart buildings, which use automated processes to control a variety of operations such as tracking and man-aging energy, environment, security, and other key features are expected to see stronger demand in the coming years. Most landlord respondents (84 per-cent) to CBRE Research's recent technology survey believe that the technological innovation will drive stronger demand for smart buildings which are ex-pected to command a premium as they will be more attractive to potential tenants due to their prestige and comparatively lower operating costs.Asset Flexibility: Advances in technology are trans-forming the traditional processes of companies de-ciding on a location where they would like to do busi-ness, buying or leasing an office, fitting it out to their specifications, and installing it with technology for their staff to perform their jobs. The digital age is reversing this process, individuals are in the driving seat and companies' decisions are being informed by connectivity and accessibility, as well as talent attrac-tion and retention. While location will remain im-portant, this will require buildings and workspaces to be far more flexible and adaptable than before. New developments will therefore have to be constructed with flexibility in mind.Data Centre Demand: Data centres are set to play a leading role in Smart Cities as repositories for mas-sive volume of data required to be collected, stored, analysed, and archived. Data centres are already be-coming as important part of business operations in office, retail, and industrial assets, supported by in-creasingly digital world, IT development and the im-portance enterprise IT strategy plays in business de-livery. This will drive demand for state-of-the-art data centre development in & around the Smart Cities.While the real estate industry is making rapid progress in development and innovation of Smart Buildings, it is critical that they gain a thorough understanding of how these developments will fit into and align with the broader Smart City eco-system. In particular, real estate industry stakehold-ers will need to understand emerging data sources and how they can capitalize on them to inform the development, construction, and management of property assets. Anshuman Magazine
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