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Over 75% of new build to include IoT by 2025
- June 23, 2020
- Steve Rogerson
More than three-quarters of new construction will involve at least one facet of IoT or related smart buildings technology over the next five years, according to a report from Research & Markets.
Leading companies within the commercial real estate sector are realising tangible benefits by leveraging smart buildings as owners can charge higher fees for technology-enabled intelligent buildings. Accordingly, over 75% of new construction will involve at least one facet of IoT and related smart buildings market-related technologies over the next five years.
However, roughly 85% of legacy buildings in developed economies have issues that will require major retrofitting. The report sees this statistic improving over time, but remains a major head-wind in terms of capital investment for the smart buildings market.
The report anticipates that the economic environment of the next five years will be characterised as asset deflation and commodity inflation, which will place a high degree of emphasis on increasing the value of depreciating assets while reducing the cost of inputs to production and service delivery, and reducing commodities as a whole. In other words, enterprise asset values will go down while operational input costs for materials and energy will go up.
It is estimated that urbanisation will cause up to 47% of global resources to be consumed by residential and commercial buildings by 2027. Of this amount, over 65% of global energy – mostly electricity, but also natural gas and fuel oil – will be used by enterprise and industrial facilities along with over 30% of the overall global water consumed. This will put a drain on increasingly more expensive and scarce resources as well as the bottom line of corporations.
As asset tracking is increasingly becoming an important aspect of overall enterprise and industrial operations, the smart building market is viewed as the focal point for various corporate capital infrastructure governance, including monitoring, traceability and accountability for custody of care, use and performance. Accordingly, there is an emerging market opportunity for integration of asset tracking with building-related systems.
As companies begin to open up operations in the wake of the Covid-19 pandemic, building operation managers will be tasked with identifying the most efficient and effective means of determining if personnel should be allowed in offices and other places of work. In addition, monitoring will be required to determine if someone has potentially become ill. Accordingly, many of the smart building systems put in place to monitor workspace use will be augmented and expanded to include thermal imaging and other tools to help.
Smart building automation software and systems will reach $20.5bn in North America by 2027, says the report. AI-enabled IoT (AIoT) systems will drive integrated workplace management system (IWMS) efficiencies and automation to an entirely new level by 2026.
Smart facility water management systems are predicted to represent an $850m market opportunity in Europe by 2027.
The post-Covid-19 world will challenge building operations management in terms of public health compliance, and life cycle cost management for facilities is becoming a key factor in building selection for corporate giants such as Amazon.
Leading providers such as IBM are changing the smart building landscape through a multi-dimensional approach to investment RoI. And the report says the key to success in the smart building market is to integrate intelligently data, systems, processes and assets for enterprise and industrial operations.
The report evaluates the smart buildings market including technologies and players, and analyses smart buildings challenges and opportunities, assesses market potential, and provides accompanying smart buildings market sizing, globally as well as regionally, and by market segment for 2020 to 2025.
The report includes an analysis of technologies supporting smart building automation, IWMS, and smart workplace applications and services. Smart building technology integration areas addressed within the report include 5G, AI, data analytics and edge computing.