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Digital transformation: a stealthy path to sustainability in real estate?

The relationship between digitalisation and sustainability represents a new frontier for many property owners. Newsec's Christoffer Börjesson explores some of its dimensions.

15 SEPTEMBER 2023

 ▪ 6 Min read

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Reducing a sizeable climate footprint, curbing soaring electricity costs, dealing with potential power shortage, and managing energy efficiency and reporting requirements to obtain various certifications. These are some of the challenges facing real estate today.

But with tailor-made plans, property owners can reduce energy use and cost while reducing their climate impact. The same plans can also serve to make them more profitable and attractive to investors, and obtain green financing.

“We recognise that sustainability done right can be a profitable venture. Our work for various clients contributes to making them more climate friendly as well as energy and cost efficient, which has a positive impact on property values,” says Christoffer Börjesson, responsible for Digital Accelerator at Newsec.

What actions for clients can reduce their emissions?

“In large renovation projects, which are sometimes a necessary evil, it is key to work with new processes and suppliers – and work in collaboration with our customers - to reduce CO2 emissions as much as we can. In our daily operations, it is about working with green energy contracts. Their CO2 footprints are smaller. Managing energy projects allows us to develop a range of solutions for efficiency and optimisation. We measure, analyse and decrease energy consumption and that reduces the environmental footprint. We also work on solutions for locally produced energy.”

We measure, analyse and decrease energy consumption and that reduces the environmental footprint

How solidly can you claim that increased energy efficiency will also reduce your customers’ energy costs?

“If customers invest in the digital infrastructure we often advise them to, which makes them able to measure and analyse, we know better what usage drives cost. Using that intel we can create programs to reduce energy and cut costs that risk ballooning. And of course, energy costs have come up quite significantly in the past two years, which gives efficient use an even bigger savings potential.”

Are there ways of getting around soaring energy prices?

“With our clients, we look at it holistically. Who pays for the energy? How can property owners create business around their own production and storage, and in some cases also become a producer of energy for their tenants? All to reduce costs and create incentives for green energy. A large part of this is working closely with users and tenants, to ensure that they are also involved and contribute to reducing energy costs.”

What do customers stand to gain from more digitalised management?

“If a property owner has a digital portfolio, i.e. digital technology and infrastructure that measures how their property performs in water usage, heating, climate, ventilation, utilisation rates and so on, it provides insights that make it possible to work with the costs or usage patterns that have the greatest impact their goals. Digital technology in a property, along with a management plan, enables more troubleshooting to be done centrally. You can be clear about your priorities, and target measures where they will have the greatest effect.

“To cite an example:sensors in waste management, so to optimise the garbage collection frequency. Measuring and data also help reduce energy consumption – keeping the heating or cooling or lights off when no one needs any of that. In a digitally connected property, you can control things remotely, which further reduces admin and transport to and from the property. And time saved, of course, is cost saved. Efficient use of space and resources, less need for transport and a reduced carbon footprint are some of the benefits and gains that can be achieved through digitalised management.”

Digitalisation can be a significant investment, at least initially. What are property owners thinking about that?

“If you look at it the other way around – working with increased reporting, insights into cost drivers, energy use, being part of the energy system and influencing the indoor climate – how can property owners do that without digital technology? Of course, digitalisation requires investments, but that doesn’t necessarily mean just high costs. More data-driven properties enable insights that aid prioritisation. Then you can address the things that have the greatest impact on costs and tenant experience, and quickly see returns on those investments.”

Digitalising to become more sustainable - a few key points

  • Holistic and common – agree on a strategy and work from an overall company perspective.
  • Infrastructure – install technical measurement infrastructure in the properties so that you measure correctly based on your plan and targets.
  • Ready to use – have clear planning and measurement instructions for the property, so that you know which measuring points and meters can be checked by the appropriate authorities, and also for various insights, reporting or follow-up.
  • Follow the money – Link technical measurement data with economic data, to create an overview of what underpins the largest costs and how these costs will develop over time.

A text on the same theme appeared in FörvaltarForum (in Swedish).

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