Beyond the pandemic: the building blocks of sustainable real estate

Mark McLoughlin, Siemens Financing Partner for Smart Infrastructure   

Let’s face it - 2020 has forever altered the way we use shared spaces – be it hospitals, classrooms, offices, factories or libraries. Universities and offices, for instance, have switched to remote work while manufacturing companies have had to limit the number of staff on the factory floor. Collectively, we’ve become used to keeping our distance from one another and navigating our way using stickered arrows and anonymous signs.

 

Even now as aspects of our lives regain a sense of normality, many companies have opted to offer total or partial remote work for their workforce. This means many buildings are still only partially occupied. Nonetheless, key building systems like heating, ventilation and air conditioning (HVAC) and lighting have returned to their pre-pandemic patterns of consumption – yet the buildings are being occupied differently to before. It goes without saying that heating or cooling an entire building homogenously is wasteful, particularly when it is only semi-occupied. With 28% of all carbon emissions stemming from non-residential buildings,[1] it’s clear the way we manage buildings has to change.

 

This is where smart buildings come in. Smart building management systems can help reduce energy consumption and get closer to climate targets, for example, by controlling a building’s temperature and varying it across different rooms or areas, depending on its use and the desire of its occupants. Similarly, for companies seeking to adhere to social distancing requirements, localised lighting will become of even greater value – allowing for lighting to be automatically adjusted to the occupancy level of a particular space as well as to the natural light it receives. In smart buildings, individual rooms can be controlled and monitored independently, automatically and remotely – an ideal capability during this period of lower density of building occupancy.

 

The benefits of smart building technology are evident, but finding practical, affordable and sustainable ways of achieving smart building conversion is usually the challenge. For energy efficiency conversion alone, Siemens Financial Services (SFS) conservatively estimates the cost of meeting official targets by 2040 to be: $62 billion for offices; $14.4 bn for hospitals; $33.9 bn for factories; $6.2 bn for public buildings and $74.8 bn for education buildings. That’s a considerable investment.

Luckily, experienced financiers offer financial techniques and solutions that remove the need to  invest large sums of capital upfront, bundling the cost of technology upgrades into a monthly fee across an agreed-upon contractual period. Here the cost of conversion can be spread over a financing period – managing cash flow by aligning expenditure with the rate of energy savings. The customer still receives all of the benefits of the new technology but has not had to devote a large amount of capital in one go. Get in touch to find out more about our smart building conversion financing options!

 

[1] World Green Building Council, New report: the building and construction sector can reach net zero carbon emissions by 2050, 23rd September 2019: https://www.worldgbc.org/news-media/WorldGBC-embodied-carbon-report-published

 

 

Mark McLoughlin, Siemens Financing Partner for Smart Infrastructure

I have worked as a strategic account manager & financing partner within Siemens Industries and Markets for the past eight years, with over 20 years’ experience in the finance and leasing industry. My role focuses on supporting Siemens by providing innovative financing solutions as part of its value proposition to customers.

 

In my free time I devote my energy to family time with my daughters (3 and 5 years old) and enjoy running, cycling through the Warwickshire countryside, and watching Aston Villa.