Can smart city tech shape America’s real estate?
Cities and districts across America are increasingly adopting smart technology.
Drones monitor construction progress. Robots probe the sewer system for insights into human health. Streetlights maximize street parking and report on air pollution.
These innovations are not taken from the storyline of a sci-fi series. They are real technologies in use in so-called “smart cities,” and they have the power to transform urban life in America.
“The 20th century city was really inefficient,” says Dennis Frenchman, Professor of Urban Design and Planning at MIT. “As startups develop new technology, and municipalities connect with innovators, we’re on our way to getting far more value out of the existing systems that comprise a city.”
With the kind of data these new and improved systems provide – on how people move through public spaces, how they use transit, where and when they spend their time and money – both the real estate industry and city governments can respond more effectively to trends and economic changes.
America turns to smart technology
Cities and districts across America are increasingly adopting smart technology. Columbus, Ohio, for example, is using an integrated data exchange (IDE) to collect information from sensors installed on traffic lights. The city analyzes the data to determine which intersections are prone to accidents and which streets are frequently blocked off – and inform drivers of these danger zones.
The city now has a cloud-based platform that holds the datasets from all its smart technology, and encourages developers to use it to make real estate decisions.
In Philadelphia, it’s the private sector that’s taking the lead when it comes to making the city “smart.”
Because Philadelphia’s public resources are focused on human services and education, there’s a real opportunity for non-public sources of funding to step in and implement smart city technology, says Lauren Gilchrist, Director of Research for JLL in Philadelphia. That includes real estate owners of all shapes and sizes.
Brandywine Realty Trust, for example, is Philadelphia’s biggest landlord. The company partnered with transportation technology company TransitScreen to install interactive screens in its office building lobbies that give office workers, commuters, and visitors real-time updates to mass transit schedules. The screens also show car share locations, Uber distance updates, and bike docking information so they can choose the most effective mode of transportation.
These devices are efficient, Gilchrist says, because they are user friendly. “Smart tech is most effective when it is inherently utilitarian for the consumer,” she says. “People won’t go out of their way to adopt it.”
From smart tech to innovation districts
Boston, a city known for its technology credentials, is delving more deeply into how smart tech can shape urban living. There, local municipal resources, startups, and innovators at institutions like MIT have come together to create an “Innovation District.”
In this district, which spans 1,000 acres in the former South Boston Waterfront, the MIT-incubated startup Biobot deploys robots to mine the sewer systems for biological data. This information can map the health and wellbeing of the city, giving insights into the services residents need.
“We already pay for the waste system,” Frenchman says. “If a system can double its use, by generating data about human health, then you get more bang for your buck,”
The same idea applies to streetlights, which double as monitors of pedestrian traffic, air quality and available street parking spaces. They maximize the value of the power grid, making it not only a source of light but also useful data.
The resulting information is a treasure trove for the real estate industry, which benefits from a better understanding of how to take advantage of the built environment.
“Smart technology adds value to existing infrastructure, which can then be passed on to real estate professionals and then on to consumers,” says Frenchman.
For example, a developer that utilizes the streetlight data set will be able to maximize the availability of street parking, potentially reducing the number of parking spaces needed at a property.
Smart districts are not only sprouting up in the states. There are examples around the globe. In Canada, the publicly-funded organization Waterfront Toronto, put out calls in spring 2017 for proposals to revitalise the 12-acre industrial neighbourhood of Quayside along Toronto’s waterfront. The winning proposal? A mini smart city, designed from the ground up.
Global tech spending on smart cities initiatives is forecasted to reach US$80 billion in 2018, with figures expected to accelerate further to US$135 billion in 2021, according to International Data Corporation (IDC).
Creating a smarter future
The city of the future is smart, resilient, and interconnected. It utilizes a range of technologies to improve the lives of its citizens. The most successful smart cities will ensure that disparate municipal agencies and private entities share data and work together efficiently, Frenchman says.
While smart cities are currently in their very early stages, Frenchman expects smart technology to develop more rapidly, and become more commonplace, as the next generation of entrepreneurs gains more influence.
“Digital natives see any public space as a productive space,” he explains. “This makes them likely champions of technology that collects data to create a healthier, smarter city.”
They also drive the demand for smart technology. Digital natives prefer access to digital content everywhere, all the time. Cities will have to update their digital infrastructure to handle their demands for reliable wifi and 5G service.
“The smartest cities are the ones that capitalize on the installation of that digital infrastructure and put it to good use,” Frenchman says.
Yet making the transition to a fully smart city is not without its challenges. First, there’s the issue of security – preventing the possibility for data breaches and other cybersecurity threats.
Then, there’s the challenge of getting city governments fully on board. “It’s a tough sell to convince an individual municipal agency that it should openly share limited resources or a completely open network platform with myriad others whose missions are wholly different,” Frenchman says.
But it’s exactly that kind of platform and data sharing that will allow for these innovations to really take off and enhance urban life. Smart technology is poised to define the future of the global city.