Real estate is going through some critical changes in this century. It has become a more complex product to understand, manage and sell. It has become more sophisticated than just “selling space”. It has gone beyond the inclusion of traditional amenities of energy management (HVAC), life safety, security, elevators and parking.
Most real estate executives fail to see this new trend. Corporate tenants have become more demanding in what they are looking for when it comes to intelligent amenities (redundant power sources/supplies and multiple network carriers providing broadband connectivity at multiple gigabit speeds).
WHAT CORPORATE SITE SELECTION COMMITTEES LOOK FOR
What I have found in the last seven to eight years is that corporate site selection committees are looking for new criteria that may be surprising to most. Ten years ago, they did not even know what broadband connectivity was, but today, it is part of their top five priorities in looking for new space for corporate facilities. If you don’t have it, they move on to the next market.
In a recent white paper, I wrote that real estate has converged with other elements to create a sophisticated “platform for commerce” for the corporate tenant that needs to compete globally.
This RITE© approach to 21st century real estate projects include four elements that are critical in relation to understanding every layer of the platform for commerce which supports businesses as well as government and residential structures. Understanding all the financial interrelationships is also critical for financial reviews and comparative assessments of various layers of the infrastructure.
THE “RITE” APPROACH TO REAL ESTATE PROJECTS
|R EAL ESTATE||
IMPROVEMENTS (WITHIN & SURROUNDING THE LAND)
|E CONOMIC DEVELOPMENT||
MARKETING/ PROMOTION/ FINANCING/ PACKAGING
Source : ©James Carlini, Copyright 2012
Each element’s specific attributes will determine the shape of the project:
REAL ESTATE: What and where is the land that the project is on? Is it the best use of the land? Are there any issues/obstacles to be aware of?
INFRASTRUCTURE: What is in-place/ available/ accessible to that piece of land? Access to transportation? Rail? Airports? Power grid and network communications?
TECHNOLOGY: What extra intelligent amenities have been added onto the infrastructure? Redundant network carriers providing Multi-Gigabit connectivity? Redundant power suppliers? Wireless networks (DAS, WiFi) to handle high capacities of Smartphones? Other cyber/connectivity intelligent amenities? Digital signage within the building or campus?
ECONOMIC DEVELOPMENT: How is this project being positioned within the region? How is it being packaged to prospective corporate tenants? How is it being funded in both its initial and operating phases? What impact does it have on regional sustainability?
ECONOMIC DEVELOPMENT EQUALS BROADBAND CONNECTIVITY
Real estate development and its subsequent marketing have to adapt in order to fit the dynamic demands of prospective tenants dealing with the global economy. In some parts of the United States, there is a multi-level government concern for regional sustainability and job growth. This has created a new unity in some places in community development between municipalities, counties and the developers of business and industrial parks.
The importance of being in the right location now includes being connected at a high-speed access point to communicate with global customers, clients and suppliers. Just like locations were important for centuries based on their proximity to good transportation, seaports and roads, they now must also be adjacent to high-speed information highways and have both wired and wireless network infrastructures that tie buildings and communities together.
Next-generation real estate requires new intelligent amenities like redundant power and multiple network carriers providing broadband connectivity and access to Smartphone coverage. It needs to be clearly defined and it includes:
IB – Intelligent Buildings (those buildings that go beyond providing traditional amenities and provide access to intelligent amenities like multiple network carriers and redundant power sources so there is no single-point-of-failure) These buildings were first being built in the mid and late 1980s and have progressed to include “green” buildings or those who have energy-efficient amenities built-in.
IBC – Intelligent Business Campuses (the next-generation business campus, industrial park or technical campus consisting of multiple Intelligent Buildings with multiple network carriers and duplicated power sources.) These started appearing in the early 2000s in the United States as well as Asia.
IIP – Intelligent Industrial Park (the next-generation business campus, industrial park or technical campus.) IIP is the acronym used in Asia for an IBC.
IREC – Intelligent Retail/ Entertainment/ Convention Center complex (A multi-venue campus of retail stores, entertainment/restaurant centers and convention and/or sports arena built to provide new Smartphone applications that cross-market the products and services of those businesses within the “umbrella” of the DAS (Distributed Antennae System) wireless network.)
When you look at the real estate market, Developers are concerned with:
- Obtaining adequate return on investment
- Creating Value, and
- Accelerating the “lease-up” time period.
The Owners are concerned with:
- Capital Preservation
- Adequate return on Investment and
- Maintaining optimal occupancy and leasing agreements.
Selling products and services into this 21st century integrated real estate environment requires an expertise in understanding multi-disciplinary skills and next-generation solutions. It is a multi-level sell when trying to promote new intelligent amenities for next-generation buildings, multi-venue entertainment centers, and intelligent business campuses.
CARLINI-ISM: 20th century real estate strategies and solutions will not fit or satisfy 21st century real estate requirements.
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