IBCon 2017 San Diego is a wrap. I leave this event more excited about our industry than ever before. The attendees, speakers, exhibitors, educational tracks and conversations indicate that many companies are ready to take critical steps toward a better managed built environment. We saw a greater appetite for solutions beyond energy optimization, fault detection, cyber security and single service technologies. And the industry is now exploring how to apply technology to the entire business process of real estate management.
The intelligent building community of the past was enamored with what I love to call ‘bright, shiny things’—single service technologies and devices that lack interoperability and create a labyrinth of systems for customers to manage. At this year’s IBCon, however, it was clear that we’re starting to take a more deliberate approach to intelligent buildings strategy.
Looking back on my first IBCon in 2012, the Las Vegas-hosted event was small—less than 500 people. Only a select few industry pioneers with a vision for what intelligent buildings could become attended. In a noisy space crowded with regional conferences, IBCon was not yet on the radar of many real estate owners and operators. Conversations at that time focused on mainstream building controls, energy management and attention-grabbing but limited tech like IP-connected fire extinguishers and drones.
IBCon 2017 by the numbers
Fast forward five years and IBCon has matured into a global event. 2017’s landscape includes exhibitors from all over the world that offer a variety of solutions; experienced CRE veterans touting tried and true case studies; and a world-class keynote address delivered to 1,500+ audience members on a stage featuring a 60-foot video wall. The major tech players – Dell, Intel and Microsoft – all had large presences. Notably absent were “the big four,” Honeywell, Siemens, Johnson Controls and Schneider.
It’s no surprise IBCon has gained international traction. Global real estate is worth more than 200 Trillion dollars, more than three times the world GDP, and represents more than 60% of total assets. Over the past four years, the annual capital invested in RETech grew from $450M to over $2.7B. IBCon’s expansion is a true reflection of the rapid convergence of real estate and technology. Unsurprisingly, that’s caused some discomfort as long-term players are forced to make room for exciting new challengers.
Where are we now?
Matt Toner, Managing Director at CBRE highlighted the 3 most important things in commercial real estate: rental revenue, operational costs and the cost of debt. Toner stressed that technology will profoundly affect these motivators— e.g. how autonomous vehicles will impact the future design of car parking. Toner cautioned that for companies who wait too long to solve the friction between tech and business, it might be too late.
Opening keynote speaker Dr. Larry Smarr, Professor of Computer Science and Engineering at UC San Diego, best summarized a key theme of this year’s conference when he challenged the audience to “disrupt or be disrupted.” Dr. Smarr noted that sudden changes are usually predictable long before they happen and are often catalyzed by new technologies. He drove his point home with an illustration of retail’s steady plateau from 2000-2017, compared to Amazon’s consistent increase and eventual skyrocket to market domination during the same period.
Winners and Losers
Dr. Smarr described how no industry is immune to technological transformation and as history teaches us, there will be winners and losers. As new players emerge, incumbents must prepare to leverage technology’s tools to stay competitive.
He recalled how in 2007, Steve Jobs launched the first iPhone and consumers pounced on it, embracing tech in ways never before imagined. Jobs unleashed a tsunami of innovation and as consumers, we’ve been surfing that wave for more than a decade. We all remember the winners of innovation battles like this one, but we typically forget the companies and products that disappeared or had to hurriedly reinvent themselves. Consider the relics of the travel industry: telephone directories, printed road maps, newspapers, cameras, guide books, travel agents. How did you plan a trip to a new place in 2007 and what companies earned your business as a result? How many of those names still make your list today? Exactly.
Consider the enterprise during that same decade—real estate, specifically— and you’ll observe only incremental gains. Technology hasn’t driven transformative change in our industry. Not yet, anyway. So, how does the enterprise take advantage of technology and position itself for digital transformation to prevent extinction?
Preparing for the future
Attending IBCon each year is an excellent litmus test of the appetite for RETech and the underlying trends behind each wave of maturity. This most recent wave saw customers introducing IT into the conversation and bringing their CIOs and network administrators to the event in search of more holistic answers. For our industry to be successful, solution providers must meet this challenge and form a collaborative ecosystem that provides end-to-end solutions.
In his keynote, Anant Yardi, President and Founder of Yardi, encouraged emerging companies to accomplish this by aligning with “technology enablers” who can help drive innovation and deliver the best value to customers. Some of these pillars and Switch partners include Dell, Intel and Microsoft. Looking to the future, customers in the built world have two critical questions to consider: What’s the biggest obstacle to overcome? The status quo. What’s likely to change that? Getting uncomfortable enough to evolve.
Want to experience IBCon 2017? Click here to watch the video.