How the Digital Ceiling Could Change Commercial Real Estate

A VIEW FROM THE TOP

Two decades ago, technology firm Cisco moved voice calling from conventional phone lines to data lines, enabling capabilities like Voice over Internet Protocol (VoIP) communication. Some five years after that, the company moved closed-circuit cameras onto the same lines, allowing commercial property owners, for instance, to combine data, voice and camera functions into a single network.

Those moves were part of what John Baekelmans, CTO of the company’s Internet of Everything Solutions group, describes as an ongoing effort to better integrate various building features and functions. This year, the company took another significant step in this direction with the launch of its Digital Ceiling offering, a product linking voice, data and cameras with building systems like lighting, heating and cooling, as well as sensor technologies for tracking things like room occupancy and use of space.

Sensors are giving you the data you need to run and optimize your building.

“We believe that it is time that more of the resources within buildings that are typically on separate networks start to converge over the same network,” Baekelmans says. “That is basically the vision of the Digital Ceiling. More and more endpoints and capabilities in your building converge on that same network, and because of that, you can create new capabilities and new experiences that you could not achieve before by keeping everything separate.”

But these LEDs aren’t just lights, Baekelmans notes. “They are also sensors.”

“And these sensors are giving you the data you need to run and optimize your building,” he says.

For instance, temperature sensors on the lights can speak directly to heating and cooling systems, eliminating the need for individual thermostats in rooms while streamlining communications between these different building systems.

And that’s just the beginning. Baekelmans says that Cisco is currently partnered with 23 outside parties to develop and incorporate new capabilities for its Digital Ceiling. And beyond making buildings more user-friendly, the company hopes to give building owners and their customers tools for better understanding how their spaces are used.

“We have now integrated into the [Digital Ceiling] ecosystem [technology] that can detect the number of people in a room in real time,” Baekelmans says, providing an example of the capabilities that Cisco is working to incorporate into the product. “That is important because you want to start understanding the characteristics of your building and understanding how your building is really being used and how you can optimize the space.”

This ability to better understand building usage is one of the most compelling aspects of the Digital Ceiling, says Mike Gedye, an executive director at CBRE. Features like better integrated lighting and HVAC systems could help streamline building operations and lower costs, which are certainly attractive propositions. But the ability to track and, perhaps more importantly, predict building usage will bring about significant changes in the commercial real estate business itself, Gedye notes.

Traditionally, property is leased on a long-term basis, with occupants deciding how much space they will need in the coming year or years and then signing an agreement for that space. But with the data made possible by the Digital Ceiling, landlords could potentially move from this model to a more pay-as-you-go, service-based approach to leasing their properties.

“To me, what is exciting about the sensor-led approach is when we move from historic or present reporting activity or use—we knew who was using that building yesterday, or we know, currently, who is in the room—to anticipating and predicting future use,” Gedye says. “Because that is the bit that most owners and occupiers would love to get their arms around. How do I predict the future demands on my space both in terms of seats and services? And then you can start to provide these products not just on a contractual basis, but on a service basis.”

The flexibility of the digitally connected ceiling also allows for a far more personalized user experience.

“Right now we typically charge [occupants] for the use of a seat per year, and the user pays an allocation for the cost of that seat. There is often no incentive for the business user to make better use of that seat because they have already paid for it,” he adds.  

“When you start to be able to control not only the provision of the space but the utilization of the space on a real-time and predictive basis, you can start to charge not by the year but by the day or by the hour or by the actual real-time use, and therefore, you can start to use your resources more efficiently. The flexibility of the digitally connected ceiling also allows for a far more personalized user experience because lighting, the physical environment and technologies can all be configured automatically to the preferences of the user. The provision of workplaces will truly become all about delivering customer services and experiences.”

Flexible space providers like Regus and newer co-working businesses like WeWork are already making limited use of such notions, but, Gedye says, technology like the Digital Ceiling will enable a far broader adoption of this approach.

“This trend is very much in its infancy because there hasn’t previously been a way to deliver the service in a way that the benefits are actually measurable,” he says.

But change is coming. In fact, it’s hanging right over your head.

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