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Increasing Energy Efficiency + Employee Well-being with Smart Buildings

With so many everyday products and appliances becoming “smart,” it is interesting to look at past depictions of what people thought the future would hold — be it a dystopia or a utopia. Today’s world is not like that of the Jetsons or Blade Runner; however, technology is more advanced than many people realize.

Imagine a building that can learn about the people who pass through it, studying their preferences and responding to them almost like a living entity, even self-regulating to harness efficiencies. These buildings already exist and are called smart buildings; they are facilities not just of the future but the present.

What is a Smart Building?

A smart building is a self-aware facility that takes data from its external and internal environments and monitors occupants to adapt to meet needs and preferences. To varying degrees, all smart buildings are future-proofed, adaptable and responsive.

Smart building users are active participants by providing feedback and being monitored by sensors, tags, geo-location zones and more through the Internet of Things (IoT). People are empowered to utilize integrated technology to make their own comfort decisions, helping the smart building predict future behavior and be truly occupant centric.

Early Adopters

Over the past several years, European countries have been on the forefront of implementing technology and sustainability changes. Two of the most well known, sophisticated smart buildings in the world are One Albert Quay in Cork, Ireland and Deloitte’s The Edge in Amsterdam. Both facilities are hallmarks for the future of corporate real estate. Monitoring occupants not only allows these buildings to adapt to user preferences, but also reduce energy usage and waste. For example, by tracking who is in the building and applying statistical usage data, on-site chefs know exactly how much food to prepare for that day, and elevators can be timed upon a person’s arrival to reduce wait time, maximizing their day. At One Albert Quay, 200 liters of rainfall are collected and repurposed back into the building central plumbing system.1 At The Edge, employees utilize a free address system, with live train and bus schedules sent to building users’ cell phones to help plan commutes.2 Thousands of light and temperature sensors throughout both buildings are linked to a central data analytics platform, enabling smart facility management. This helps, for example, guide cleaning staff to heavily used areas for extra sanitizing and restocking and allows facility managers to perform predictive maintenance by monitoring system usage. For these companies, their facilities have become one of, if not their strongest, recruitment advantages.

Advantages of Smart Buildings

Smart buildings offer two main advantages:
1. They provide increased energy efficiency by streamlining usage;
2. They aid in employee well-being by customizing spaces and allowing occupants to feel safe, knowing there is increased security.

Efficiency + Sustainability

Though varying from country to country, utility fees generally are significantly higher in Europe than in the U.S., increasing incentive to streamline and reduce where possible. For example, in September 2020, German households had the highest energy rates in the world, paying about US $0.36 per kilowatt hour plus value added tax; Polish residents by comparison paid half as much, while U.S. households paid even less.3 Designing a smart building is a significant upfront cost anywhere in the world, but it may only take 10 years to pay off the investment in Europe, whereas it could take 20-30 years in the U.S.

More than just saving money, smart buildings are as much of a long-term investment for a company as for the environment. Smart buildings react through automatic load reduction and shifting, and shedding or peak shaving (reducing demand during peak usage times) as they communicate with the power grid; some can even create their own power through solar, wind and
water repurposing.4 In this way, smart buildings are the first step from a centralized power grid toward a localized one, where the building becomes both the consumer and producer of the energy needed to operate.5 Additional sustainable steps, such as monitoring CO2 levels based on occupancy, not only protect the environment but also contribute to employee well-being with healthy, circulated air.

Employee Well-being

Wellness and health are already prominent discussions related to building design and will only increase in relevancy post-pandemic. While energy usage is easy to monitor, it is difficult to put a price tag on intangibles such as employee well-being. Smart buildings can positively affect peoples’ physical and mental health in a variety of ways. On a macro level, these facilities provide increased awareness of sanitary needs throughout the building based on traffic levels, operable windows open or close based on exterior conditions and window shades can automatically adjust to maximize daylight or reduce glare; on a micro level, individuals can provide feedback on their specific preferences for temperature and light levels to customize their experience. Smart buildings work smarter, not harder, and ideally enable their occupants to do the same.

Another benefit of smart buildings is the support of recruitment strategies; creating a facility where people want to be can attract top talent and retains enthusiastic employees, resulting in improved company performance. This is even more important following the pandemic, during which people worked from the comfort of their own homes. By offering a space that can be customized through lighting, temperatures and responsiveness to their desires, smart buildings can replicate or even improve upon the comfort and flexibility of home.

Many pilot programs are also using a free address approach in smart buildings to offer flexibility. Employees check in and are assigned or can choose a place to work each day that meets their preference for focused or collaborative work and the space responsively adjusts to their preferences. Furthermore, employees can tie their schedules to the management system to place them in the most productive, enjoyable environment. For example, when scheduling a meeting, the smart system can select the meeting space in an optimized location, equipped with technology that is powered up and ready upon arrival, and even set to the specific temperature preferences of the users. This saves employees time searching for conference rooms with their technology needs and availability and allows companies to be more efficient with how they invest in technology; it may not be necessary for all conference rooms to have the same high-end technology as the system helps people find what they need faster. These streamlining measures not only make users more comfortable, but they can also lead to increased productivity levels as people can tailor an environment that works best for them. The lives of FM staff can be made easier through predictive maintenance indicators smart buildings provide, such as monitoring and indicating replacements of filters in mechanical systems, equipment service life updates or water leaks.

Key Considerations

For some, upon first hearing of smart buildings, their instant reaction is apprehension. However, what many people do not realize is that if they have a device on their person, such as a smartphone or smart watch, they are already being monitored from data collected through IoT — the same platform that smart buildings use. Especially for those who are unsure, there is a degree of transparency and trust that employers must earn by explaining how the system works and the benefits of data collection. Like most policy changes, change management is key in ensuring employees are heard, known and understood. To navigate the transition to a smart building, conversations between leadership, staff and the design team are vital; just because certain smart measures are available, it does not mean they are a good fit for every company or culture. Smart buildings are a significant upfront investment. Like any major financial or cultural decision, all factors must be considered with candor and align with a company’s long-term goals and mission.

Change can be difficult, especially when it comes to technology. Much like with the emergence of cloud-based systems, there have been many early adopters who are excited about the prospect of smart buildings, but also some who are cautiously waiting to embrace technology until it is essentially mainstream. Initially, when the cloud was introduced, many companies, especially in health care, were resistant, fearing that they could not control data. Now common, cloud storage can provide more security than previous hardware systems. The rise of the smart building appears to parallel this pattern. As with the cloud, the more people who jump on board, the more widely accepted the technology becomes until concerns are eventually addressed or disappear entirely. So far, we are unaware of any major security breaks in smart buildings, but the possibility certainly exists; so, it is paramount for owners and FMs to stay vigilant, taking additional security measures such as hiring security advisors, doing regular assessments, performing penetration tests and having emergency response plans in place. As smart buildings become more common and understood, people’s fear of the unknown will eventually diminish, giving way to acceptance.

Smart buildings will eventually yield a positive ROI through energy savings and improved employee performance, but it will take time. Companies considering a smart building must decide if they are in it for the long haul or where the tipping point will be for pay off.

Three key performance indicators are:
– the initial investment payback period,
– the building cost (purchase, own, operate, maintain and decommission) over its lifetime, and
– savings achieved as compared to the initial capital investment.6

Still relatively on the frontier of smart buildings, data continues to be gathered. Case studies will be particularly important for seeing theories actualized to aid companies in making the decision to go “smart,” and “how smart.” Fortunately, smart building software technology is highly customizable and future proof, and hardware can achieve long life spans with slow depreciation. Hardware will inevitably need a refresh at some point, but most things associated with IoT are very simple in nature, such as water sensors that do not have a lot of anticipated room for improvement in the future.

The Possibilities Are Endless

The industry is just scratching the surface of smart building technology possibilities; the more data acquired, the more informed this technology can be and the greater its potential. If an organization is interested in pursuing a smart building, it is best to lay out all the possibilities and allow them to pick and choose what works for their company and culture. Integrating workplace strategy into the earliest stages of smart building design has historically created the highest performing facilities.7 When an organization has a clear idea of how they work and how space design and function can help them meet their goals, only then can they put smart building technology to work for them. The best advice for those considering a smart buildings is to be open to the possibilities. These developments are exciting and help improve the health of business and their employees in so many ways. When possible, begin small, incorporating smart elements to address immediate needs that provide high value, before committing to a full-blown smart building. Start conversations early in the design process anchored by research on culture, business goals and considerations for change management. Smart technology is an investment in a company’s greatest asset — employees

  

1. “Smart Building — One Albert Quay, Cork.” YouTube, uploaded by Tyco UK & Ireland, 4 May 2017.
2. “World's Greenest Office Building Is Dutch: The Edge.” YouTube, uploaded by Bloomberg Quicktake, 24 September 2015,
3. Statista, 12 April, 2021. Household electricity prices worldwide in September 2020, by select country (in U.S. dollars per kilowatt hour). Published by N. Sönnichsen,
4. Manic M, Amarasinghe K, Rodriguez-Andina J J and Rieger C (2016) Buildings of the future: Connected, Cyber Aware, Deep Learning Powered and Human Interacting. IEEE Industrial Electronics Magazine (10,4) pp 32-49.
5. Talon C (2016) 2016 Intelligent Buildings Survey. Navigant Research. pp 1-7
6. Honeywell and IHS, Inc. (2015) Put your buildings to work: A smart approach to better business outcomes. pp 1-2
7. Royal Academy of Engineering (2013) Smart buildings: people and performance. pp 1-12

Tze Chieh (TC) Lin, AIA, NCARB, LEED AP + Ken Seelow
Facilities Management Journal | IFMA

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