The Building of Buildings

Taller and multipurpose

About half the world lives in cities and urban areas today, and by 2050 this number will grow to become more than two-thirds of the population. Cities offer an incredible array of opportunities for work, play, and connections which make them eternally attractive; but for real-estate developers and urban planners - the ongoing influx of people is a challenge when trying to create sustainable and liveable human spaces.

Buildings of the future will have to be taller in order to handle growing populations and minimize urban sprawl. In dense cities, it will be just as important for buildings to be flexible, adaptable and multipurpose. The majority of our buildings in business districts today are designated as office spaces and used from around 8am-6pm, but lie unused and empty for about 14 hours per day. Transportation companies such as Uber and Lyft were birthed on the fact that the average car is only used 5% of the time; thus their vision was to catalyse ride-sharing of vehicles rather than ownership. Similarly, buildings in urban centers of the future need to be designed for multipurpose use - for activities that could carry on till late at night, as many as 7 days a week. For example, an office space could become a place of worship or country club or yoga gym by evening, and a coffee spot or wine bar or music venue by night. This type of multipurpose design may also alleviate other urban problems such as traffic congestion and pollution which are exacerbated by everyone leaving work at the same time.

Corporations with a more philanthropic bent could also consider opening a portion of their buildings to families that are homeless or going through hard times by offering a place to stay the night; major metropolises such as Hong Kong, London, Mumbai, New York, Paris, San Francisco have become so prohibitively expensive that even working-class families are driven to near homelessness.

Shadow Summit Atlanta

The best place to hear about all these topics was at the Shadow Summit conference in Atlanta last month. A lot of thanks to K.P. Reddy and his team at Shadow Ventures - Matthew Ohlman, Kayla Merritt, Nick Durham, Brian Sayre for excellent discussions, presentations and panels.

An interesting point that came up frequently at the conference was the disconnect between the considerable investments in commercial real estate (CRE) technologies - and adoption rates of these technologies. VC activity has been marked by huge inflows of capital (about $70 billion since 2015), but adoption considerably lags investment. In fact, one of the panelists brought up the interesting point that there is far more electronics and technology in a $50,000 automobile than in a $50 million building.

An interesting comparison brought up was the 10-year lifespan of an automobile and 2-year of a smartphone - versus the 40 to 50-year lifespan of a building. This fact could explain the lag in technology adoption. The annual replacement rate of buildings has been only about 2%; and it has traditionally been very expensive to retrofit an existing building with new technology. Thus it is imperative that vendors demonstrate technology solutions that are wireless and IoT-enabled and do not require “rip-and-replace”. In addition, keeping in mind the 40 to 50 year lifespan, these solutions need to be adaptable and have long shelf-life.

The picture is not all gloomy; as businesses and enterprises and consumers’ homes get digitized, the CRE sector is starting to follow suit. Offices are increasingly getting connected and data-enabled with sensors that capture occupancy rates, and shed light on which spaces such as meeting rooms, lobbies, cafeterias, and gyms are being used. This data not only shows the spaces being used but also answers the question why; for example, is a particular meeting room always booked because it has video-conferencing capability, or maybe a whiteboard for collaborative planning, or maybe just because of a high-end coffee maker! “Big Data” from these sensors will be used to adapt the building environment towards occupant preferences. Data will also be used to track buildings’ energy usage, reduce their environmental impact, and track and manage performance till end of life. In the future we will see sensors that are also positioned outside the building; these will measure not only parameters such as temperature, humidity, and pressure - but also city conditions such as roads and traffic, emergency situations, pedestrians, streetlights and trash.

Conclusions

J. Paul Getty - American oil billionaire used to say - “In times of rapid change, experience could be your worst enemy”.

Buildings have been designed, constructed and managed more or less the same way over the last several decades; but that experience may not be valuable anymore. The future of buildings is in the intersection of architecture, technology, smart cities, smart energy, smart transportation - and in the understanding of how people live, work and play. Future building design will not be the domain of architects and urban planners alone, but may include seemingly unlikely constituents such as environmental scientists, geologists, interior designers and sociologists. Collaborative design with potential building lessees and owners may become increasingly popular; new tools such as Virtual and Augmented Reality will allow users to immerse themselves in a building design in realtime and try different layouts and fitouts. 

In the 1990s I used to be a young engineer working on the hardware and electronics inside mobile phones. I believe buildings today are at the same juncture that mobile phones were in the 1990s; sociological changes such as population explosion in combination with technology innovation, ongoing VC interest, and high inflows of capital are starting to move the needle on disruption in the built sector.

To hear more, go to the next Shadow Summit slated for 22-23 September 2020 in Atlanta. Don’t say you didn’t know.

P.S. Feel free to comment or message me with questions.