The Real Estate Industry After COVID-19

The current crisis is having a major impact on real estate earnings. Major asset classes such as office, retail, industrial, hospitality and the residential sector are feeling the effects of COVID-19. This makes it more important than ever to operate the buildings optimally. Digitalisation and energy efficiency can help with this.

Impact on the areas of real estate

1. In the office, the use of office space is being completely rethought as a result of the crisis. Working from home has established itself as a viable alternative. However, in most industries, personal contact with customers and within the team remains central. The topic of social distancing, which has become relevant due to COVID-19, can have different effects. Either fewer employees come to the office or more office space has to be rented to allow sufficient distance.
2. The retail sector has been facing disruption from online retail for some time now. Now, increased demands on hygiene are putting the industry to the test. The necessary direct contact with other people is also detrimental. Many prefer to stay at home and buy online. Some retailers are in danger of closing and retail spaces could remain empty.
3. In industry , there are already signs of a decline in production. On the one hand, caused by the legal restrictions in the context of COVID-19, on the other hand, there is a global economic downturn.
4. Among the real estate sectors, the hospitality sector has suffered the most from the enormous restrictions. It will take some time to recover from the closures and return to capacity.
5. The housing sector has suffered the least from the crisis. The demand remains constant and people are spending more time in their own four walls than ever before. The possibilities from home are practically unlimited: online shopping, meetings, home office, etc. In the long term, the value of residential assets could even increase for this reason. It remains to be seen how rising unemployment will affect the housing market.

Digitalization and IoT

In all areas of real estate, the most efficient operation possible is therefore more necessary than ever before. The digitalization of processes and the retrofitting of buildings with Internet of Things-based solutions make the efficient use of resources possible and open up optimization potential. For example, by recording measured values (e.g. energy flows, indoor climate and usage behavior), fact-based decisions can be made and potentials can be uncovered.

The majority of all existing buildings are not yet sufficiently networked and thus black boxes for users, owners and all parties involved. Opportunities to increase value, reduce costs and save resources remain untapped. Modern smart building platforms, such as LineMetrics, therefore rely on wireless technology and offer fast ways in which such existing buildings can be retrofitted within days and without interfering with the substance. These platforms often use technologies that enable long battery life and high building penetration. However, these technologies are complex. For this reason, the smart building platform LineMetrics has been developed in such a way that on-site employees without an IT background can install the solution independently. Sensors pick up current data and send it wirelessly to a web platform. There, they are presented in a user-friendly way. The history and use of a building or building complex become apparent. Facts that play a decisive role in optimizations and decisions.

Sustainability and energy efficiency in the real estate industry

Despite the current COVID-19 crisis, the real estate industry must not lose sight of the topic of sustainability. In the long term, the impact on the environment must also be included in the operation. Resources, such as water, gas and electricity, must be used as efficiently as possible, as prices will rise. Here, too, the topic of digitalization plays a key role. Room utilization, air conditioning and power consumption can be read in real time and adapted to demand. In addition to meeting the requirements, ongoing operating costs can also be saved.

Due to the importance of sustainability and energy efficiency in particular, LineMetrics has started a partner program. “In cooperation with specialists, LineMetrics offers complete solutions as an innovation driver in the field of smart building,” explains Reinhard Nowak, CEO and co-founder of LineMetrics. As part of the program, the solution will be further developed in collaboration with energy consultants throughout the DACH region.