How well are you using CRE tech? See how you stack up. Take our 2-minute survey!.

How Smart Cities Are Transforming the Commercial Real Estate Industry

Table of Contents

Homes are getting smarter. The smart thermostat automatically adjusts the temperature so that you limit energy use while remaining comfortable all day long. Smart lightbulbs can be turned on or off from afar enhancing your security and convenience. You can even adjust a single lightbulb to perform as you wish. These individual efforts are helping to battle climate change while making your life easier and safer. And now entire cities are taking this “smart” approach, which is transforming the commercial real estate industry as well as your personal life.

Urban areas are growing at a brisk pace and are expected to house 68% of the world’s population by 2050. That means that commercial real estate will be at the center of a seismic cultural and economic change that requires the industry to nimbly adjust. 

Smart technology is improving the quality of life for urban residents and impacting environmental and socio-economic issues. Smart city technology is influencing many countries across the globe and not just the richest areas. The basis of this movement is connectivity between people, offices and buildings. Smart cities equal a smarter way of life.

What Makes a City “Smart”? 

The International Data Corporation (IDC) notes that smart cities focus on using emerging technologies to improve urban liveability and create new economic opportunities. Specifically, that means using IoT devices to enhance connectivity between systems. In a smart city, technology can monitor and improve traffic flow, air quality and security systems as well as collect in-depth data on communities. Smart cities increase the quality of life for all citizens and not just the ones that can afford the latest smart home tech, although those breakthroughs are beginning to show up across the economic board. 

Top smart city technology includes:

  • Mobility Alerts – People with respiratory issues receive warnings about air quality; drivers get automatic traffic updates and road construction updates.
  • Autonomous Drones – These programmed drones have been used to deliver medications and medical supplies during the pandemic. They also have many other delivery uses, especially during this age of social distancing.
  • Smart Transportation – In smart cities, traffic lights can be managed to optimize traffic flow, shortening commutes and eliminating frustrating traffic jams and lowering damaging emissions. Also, individual cars will be able to communicate with each other and lower the number of collisions.
  • Contactless Transactions – These transactions are increasing across the globe and especially in smart cities where you can consult with doctors, pay your bills and even feed the meter without being in the presence of another person. Contact is becoming a choice and not a necessity.

How Smart Cities Are Transforming the CRE Industry

Migration to urban areas combined with the move toward smart cities has impacted the way the CRE industry does business. Much of the investment in smart tech has come from pubic dollars, in part because private investors are unsure about the level of ROI on these projects. Government regulation has also scared away some developers. That’s why the industry needs to consider other benefits such as the “value chains” that result from these projects, including the foot traffic generated by sites with smart technology, the ability to capitalize on public user data and the increasing advertising dollars generated from this smart infrastructure. The return on your investment in this instance is a multi-layered one. 

Commercial real estate firms are shifting toward a service-oriented model instead of simply being property-oriented. For instance, hotels have long provided more than a place to stay. They have fitness facilities, concierge service and other experience enhancements. Commercial real estate is now trying to offer a lifestyle instead of a building. Some even offering access to events such as plays or athletic events as well as luxury on-site amenities. Offering “smart” IoT is a big part of this enhanced living experience.

This CRE evolution means that developers are working to create a community and not just a location. To be truly successful, people in the industry need more smart cities. A smart building alone does not offer the lifestyle that sophisticated urbanites and newly-minted city dwellers desire. They want it all in one place.

The Future of Smart Cities

The future of smart cities depends on finding the right properties to develop, which is why ProspectNow is key to your efforts. ProspectNow has extensive databases on both commercial and residential properties. In fact, you can search the site for detailed property records and owner contact information for 40 million commercial properties and 100 million residential properties. 

ProspectNow, established in 2008, has a proven track record and offers real estate brokers more data at a lower price than other sites. By using ProspectNow, you will close more deals and ultimately make more money and position yourself to benefit from the smart city movement.

Final Thoughts

Members of the CRE industry must embrace the smart building and smart city movement in order to attract and keep more clients. People and companies expect more than a physical space when they buy or lease. They want ultimate connectivity to people, places and services. Climate-controlled buildings are no longer enough. They want a city that provides easy-flowing traffic, air quality monitoring and enhanced data and physical security systems. Basically, they want easy access to life-enhancing technology no matter where they are. To remain relevant, commercial real estate firms are becoming more lifestyle-oriented by embracing smart technology. 

Select your Property Type

Search Residential Properties

Includes Single Family Residential Properties

Search Commercial Properties

Includes All Property Types