Crisis Innovation. The Acceleration of Technology in the Built Environment


5 / 21 / 2020


crisis innovation

Necessity is the mother of invention. 

As we’ve seen during and after historical crises either to the economy or public health, catastrophe can be an impetus for widespread advancements in urban planning and technology to support the long term greater good. Or as Winston Churchill once put it, ‘Never waste a good crisis!’

In the period following the Cholera pandemics in London, Paris and NYC, we used technology to deliver better drinking water, deployed citywide sewage systems, and ensured that every building was equipped with indoor plumbing. We also began to design our cities differently, ensuring that they had wider boulevards and nature oriented public spaces to support better air circulation. 

In the 23 year period during the Long Depression from 1873-1896, the incandescent lightbulb, transformer, radio, and refrigeration were all invented in spite of economic turmoil worldwide. 

If history is our guide, technology is poised to enter another period of accelerated evolution which will impact our cities and the built environment for the greater good.

Homes: Universal Connectivity to Bridge the Digital Divide

In the time leading up to the Spanish Flu of 1918, telephones were somewhat of a novelty, but during the quarantine, it became clear how vital they were to stay connected to the outside world. Unfortunately, the phone system at the time was not ready to handle the influx of users, and as a result the telephone company actually had to deter the use of the phone system to ensure critical calls could go through.

On the left, an ad from Passaic, New Jersey’s Evening News for October 25, 1918, warns New York Telephone customers that operators might get nosy about their calls. On the right, from Gastonia, North Carolina’s Gastonia Gazette for October 18, 1918, an ad stresses the importance of handling calls for doctors and drug stores.

 This is exactly what we’ve seen happen today, with Europe being forced to throttle Netflix and Youtube to ensure that the internet doesn’t break with the increase in usage. In the US, we saw a drop in performance in internet speeds from February to March. Some states have seen as much as a 20% drop in speeds, with the average state dropping 7.6%, indicating the strain we’ve put on our connections. 

In the US, 60% of counties – that’s 162 million Americans – now receive service that’s below the definition of “broadband”, which means that the service is barely usable or not available at all.

It is becoming increasingly evident that global digital infrastructure is in dire straits.

The term ‘Digital Divide’ refers to the gap between demographics and regions that have access to modern technology and those that don’t. Never has our reliance on technology within the home been more paramount, and never has the impact of poor connectivity been more damaging.

In the current climate, we’ve seen governments work to remove broadband deployment barriers like lengthy permitting processes and in some countries have created task forces to innovate around these issues. US based companies like Verizon have made mobile hotspot data free for subscribers and cable operators have made high speed services available at minimal prices for low income communities as part of the “Keep Americans Connected” pledge. In the UK, the government has provided 4G routers to homes without broadband connections to enable distance learning.

However, Digital Divides simply cannot exist in a world where we our children rely on the internet to learn, where workers need to video call to collaborate with their colleagues, and where the sick need tele-health to avoid overburdening the healthcare system. The collective effort between the public and private sectors to enable broadband for all has been necessary in the current moment, but this will need to continue in the world ahead as our future depends on it. 

Again, we are seeing the immediate need for another massive step change in our communications infrastructure. In the years following the Spanish Flu, every home got a telephone and the infrastructure was significantly upgraded to make communications more stable and accessible for all. 

Buildings: A Race to Smart and Healthy

It takes a watershed moment or series of events to spark a true revolution in real estate. When the Green and Sustainable construction movement was started in the 70s, it was a novel idea that was kicked around by a handful of architects interested in the first “Earth Day” of 1970.

It wasn’t until the OPEC oil embargo of 1973 that the need for green buildings became more obvious, as gasoline prices spiked upward in the summer of 1973 and gas rationing became the norm, our reliance on fossil fuels for our homes, transportation, and buildings came into focus as a major issue that needed to be addressed. 

And as the 1990s and 2000s brought extreme weather patterns and heightened awareness on the impact of human pollution, the spotlight again was on buildings and the need to construct more efficiently in order to reduce our impact on the environment.  

This time both the real estate and government communities heeded the call with the rise of certifications like BREEAM and LEED and both local and Countrywide Commitments to reduce emissions. This revolution has now become the “baseline” and is now a proven business case driven by economic and tax incentives promoted by governments. 

Similarly, over the last 10 years we’ve seen a rise in the number of buildings either using technology to drive operational efficiency and enhance occupant productivity and wellness. This is commonly referred to as the Smart Building movement which has also been slow to gain mass adoption, with a small subset of buildings in each market having invested in this technology.

As buildings are now forced to adapt reactively to tenant concerns around air quality, occupancy based contact tracing and cleaning, and a “no touch” experience, we will see the deployment of Smart Building technology accelerate even further and with a greater emphasis on “Healthy Buildings” in tandem.

This can present a massive opportunity to landlords who are thoughtful in their approach.The business case at this point is to invest out of absolute necessity, but by approaching these improvements with foresight, buildings can accomplish immediate resolution to tenant need while positioning themselves for both long term operational ROI and enhanced user experience.

For instance, implementing a hands free access control system solves the immediate challenge of getting occupants into the building without touching surfaces. Moving forward, this can be integrated into tenant engagement applications to increase customer engagement and deliver a user centric building program. Longer term, the floor by floor occupancy data from the access control system can be integrated into the buildings HVAC system to operate more efficiently based on real time and historical data.

Similar to the evolution of the Green Building movement (which started as a revolutionary concept in the mid 70s, evolved into a popular practice in the 1990s and is now a code requirement for the majority of cities) we will likely see a forced upgrade to Smarter and Healthier buildings as they become a critical occupancy requirement and reinforced through building code as a result of the current crisis.

Corporate Real Estate: A Data Driven Approach to Workplace Strategy

Workplace strategy trends that were defining the future of work have significantly accelerated as organizations have had to adjust during the COVID-19 pandemic. Companies and individual employees are gaining the benefit of experience with large-scale home-based working programs. Technology has proven to be a critical tool to maintaining collaboration and supporting human interaction in this forced remote working era. However, long term, it will likely complement, not replace, the need for the physical workplace. The outcome will likely be a rationalized physical footprint, made up of a different composition of space that is higher quality and better-equipped to support employee needs. 

As highlighted in a recent CBRE report, Real Estate 2030, published prior to the European peak of COVID-19, future trends showed that companies and workers may choose to work at one of thousands of locations worldwide on a full-time, part-time or a pay-as-you-go basis. That means people only pay for what they need, when they need it. 

As such, companies that are reimagining their spaces must also invest in technology to keep track of these moving parts. This intelligence will better help organizations understand what portion of their portfolios are best suited for long-term committed space vs. flexible, just-in-time space – all the while providing a sense of place for their employees. Occupancy based tracking will be the key to harvesting more powerful data to make these decisions and adapt in real time.

In the future, these tools can increasingly be utilized to make qualitative evaluations and recommendations – often through the use of artificial intelligence – such as noting that one team is more productive and experiences fewer sick days when working remotely. Or another team performs better in a collaborative space equipped with good ergonomics and natural light.

Businesses: Disparate but Connected

As Microsoft’s CEO recently stated,

We’ve seen 2 years of digital transformation take place in a period of 2 months.“

What he is referring to is the technological pivot that every business has had to take in the world of remote everything. This has meant that businesses have had to rapidly embrace cloud computing to enable continuity across their workforce. 

As businesses brace for the long term shift to disparate workforces, scattered across satellite offices, HQs, and homes, technology will become the ultimate enabler of business continuity. They will need to take new approaches to connectivity to ensure their teams can stay connected despite geographic separation. 

At the same time, with the increased reliance on home internet access for many employees, Cyber Security will also need to become mission critical, as the cyber attack surface has expanded beyond what companies can keep up with. We’ve seen this surfaced in the headlines, with massive ransomware attacks and cyber breaches against everyone from The World Health Organization and Donald Trump to multinational organizations like Cognizant

This means that Corporate IT will see a shifting demarcation in responsibility extending their reach beyond the office, helping employees deploy technology like firewalls and endpoint security within the Home to ensure we stay connected safely.

Above all, targeted investment towards the digital transformation of business processes and the sustained adoption of remote working policies, could offer businesses a critical competitive advantage. By providing them with a more reliable and robust access to existing, new and increasingly diverse pools of talent, which might previously have been unavailable to them.

Cities: Urban Innovation and Smarter Construction

In the wake of 19th Century epidemics like cholera we saw wide sweeping changes to urban planning, from the use of parks, to the demolition of tenements, and enactment of zoning laws.

We’ve already seen innovation within the built environment early in this crisis. In Wuhan, a 1,000 bed hospital was built in 10 days using modular construction, which utilizes pre-fabricated materials produced offsite. This revolutionary construction technique also utilizes Building Information Modeling (BIM) to make the design and construction process more efficient. 

In the near future, we are likely to see further adoption in this technique, especially as developers evaluate the impact of manual construction being halted for months, whereas building construction could take place offsite in an area less impacted by shelter in place. 

According to a 2019 McKinsey report,

Modular construction can speed construction by as much as 50 per cent. In the right environment and trades-offs, it can cut costs by 20 per cent.” 

In ambitious master plan proposals like the now defunct Sidewalk Toronto, the Alphabet Urban Innovation proposal to build a one of a kind smart city, have made modular construction a key component. Not only for what the efficiencies gained through construction, but to the long term flexibility it will enable in the urban environment. 

Adaptive reuse becomes a seamless process in this built environment, where a parking structure can be turned into loft apartments in weeks if autonomous vehicles become more ubiquitous. A process that would take years in today’s cities. 

Technology innovation will undoubtedly help transform the construction, operation and experience of tomorrow’s urban environments by seamlessly integrating live, work and play ecosystems and enabling safer, healthier and more efficient places which will allow businesses to grow and society to thrive.

As the real estate sector re-evaluates the future purpose of the built environments it delivers and businesses and society as whole recognise the need to sustain a greater purpose in the way that corporations and communities co-exist, so we will see the role of progressive and innovative technologies evolve.

Technology will ultimately provide the digital infrastructure and data backbone which will help us revitalise the world’s economies and will help us to reimagine the role of great spaces and places to meet the desires and needs of us all, long into the future.

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