Industry changes can come in multiple ways: forced by new codes and policies, evolved from demographic shifts, created by visionary technology.
Right now, multifamily change is happening in an organic, sustainable way to improve how and where we live. Luke Leung, director of the Sustainability Engineering Studio at Skidmore, Owings and Merrill (SOM), attributes this mode of change to our access to construction-related data. But, he asks, how can we create a better reality based on this information that, thanks to modern technology, we now have at our fingertips?
Leung is one of the architects behind MFE's 2018 Concept Community (CC) project, whose theme, "Building Positive: Living Well," explores the future of sustainability in multifamily development. This year's challenge, which SOM is undertaking with CC partner AMLI Development Co., is to design a project that applies the best in design, engineering, and construction to attaining sustainable solutions for creating better places to live. The conceptual project will showcase a design using true, real-life metrics meant to inspire the industry and improve multifamily housing through its adoption with economies of scale.
“Data will come together with [building] systems, just like an organism,” says Leung. “Data can sense things, react in real time, and [make] repairs. [We're] just scratching the surface right now by having the data to start with.”
Other technology leaders are seeing similar advances. Wang Jian, chairman of multinational e-commerce/tech conglomerate Alibaba's technology steering committee, recently told the New Zealand Herald that such changes should enable future cities to act like an organism, building on itself in real time:
The city of tomorrow should be able to adapt to its surroundings and inhabitants, almost like a living organism, so that municipal services like public transport, health care, and education can be delivered in the right measure and time to minimize waste and optimize usage.
To that end, a city's development would be better determined in the future by the amount of computing resources it consumes, said Wang. At present, electricity consumption is widely regarded as the measure of development for cities, he added.
Similarly, the day-to-day behavior of a city's residents now has little impact on how a city is organized as well as the way its services are planned and developed, said Wang. That would change with advanced computing technologies that are able to track human behavior.
Leung expounds on his ideas in this short video.
James Chung, president of predictive-analytics firm Reach Advisors, translates this idea into a huge business opportunity. In the past, data capture was employed almost exclusively to charge users for things like utilities, taxes, or construction costs. But, Chung points out, that's about to change.
"Now, we can understand more about the underlying cost drivers, more about usage maximization, more about bringing physical assets to higher and better use," Chung says. "Here’s the bottom line: In a capital-saturated environment, we’re going to face further margin compression from traditional assets and business models. The biggest value creation will come from the ability to deploy data to see the pockets that others don’t see."
—James Chung, president, Reach Advisors
Leung says the synergy of nature and technology will ultimately lead to a better understanding of how we live and how we can improve where we live. It will not only help us connect to nature—which has proven health and wellness results—but it will help us go beyond that understanding, and well beyond the five senses, to a realization, as Leung notes above, that is just scratching the surface.
Chung agrees that, as data become ubiquitous and the cost of data storage and interconnected devices goes down, the incentive for tying it all together will grow. Plus, there are better, more user-friendly, more-accessible tools to get it done.
"One of the big benefits we’ll see over the next couple years will be cost reductions in numerous areas that had always been viewed as constrained resources with ever-rising costs," Chung says. "For example, energy costs and transportation-related costs are more likely to get cheaper, not more expensive. We estimate that the real estate industry is about 10 years behind other major industries in the digital era, but it’s an exciting time as we all discover what can get digitized, then how that triggers a world of derivative opportunities for new value creation."
Leung and his team at SOM, along with AMLI, are currently working to find the data and metrics that tell the story of "Building Positive: Living Well," which will unfold at the soon-to-launch 2018 MFE CC webpage on www.multifamilyexecutive.com over the next six months. Track the team's progress on the CC webpage regularly, and be sure to attend the 2018 MFE Conference in September to see in-person the team's presentation of its final design.
