Ten Ways Enertiv's Clients Use Our Platform
Last week, our newsletter covered the implication of our latest milestone, passing 10 billion hours of building performance data. More specifically, how this massive dataset gets translated into learned insights, best practices, and pattern recognition that can help owners and operators save money or make better decisions.
Many wrote back. The most common feedback (apart from “congratulations”) was some variant of “I’m convinced that building data can increase NOI but seeing that practically laid out would be really helpful.”
As a general rule, we shy away from self-aggrandizement in our blog articles. However, it has become obvious from the emails we received that enumerating exactly how our platform is being used today would be highly valuable… So, let’s dive in.
What Problems Are Enertiv’s Clients Solving with Our Platform?
Enertiv’s clients consist of REITs and private real estate companies. They own and/or operate a broad mix of office, multifamily, industrial, hotel and data center properties. Their investment strategies and lease structures vary widely. Some are comfortable at the very cutting edge of technology, others are just getting started on the digital transformation.
As such, use cases vary a lot. This is a quick sampling of some ways Enertiv is being used today.
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1. Office portfolio forced to make up for reduced operations staff
2. Office portfolio implementing cost savings to increase net operating income
3. Office portfolio tying together siloed systems and documentation in one platform
4. Office portfolio digitizing tenant submetering
5. Office portfolio generating higher yields in value-add fund by capturing untapped value
6. Mixed use office + retail portfolio reducing risk associated with leaks and floods
7. Multifamily portfolio holding elevator maintenance vendors accountable
8. Multifamily portfolio implementing a “BMS-lite” for a fraction of the cost of a traditional BMS
9. Multifamily portfolio identifying energy retrofit opportunities and reporting on ESG metrics
10. Industrial portfolio differentiating their assets by marketing smart building capabilities
1. Office portfolio forced to make up for reduced operations staff
The Problem
Unfortunately, many office properties have been forced to let go of staff due to the economic fallout of COVID-19
Meanwhile, the amount of work has increased with new cleaning protocols, building flushing sequences, and filter replacements
Much of building operators’ days are spent on data entry and diagnosing issues that crop up
In the short term, it may seem like operations have been streamlined by reducing labor costs, but soon these savings will be eclipsed by the costs of deferred maintenance
The Solution
Data entry during rounds and preventative maintenance used to be manual and paper based. This took extra time and made valuable data inaccessible.
The solution is simple – automate data entry with sensors. This has the added benefit of making data collection continuous, unlocking the potential to run analytics.
One way these analytics translated into improving productivity was by calculating runtime hours of equipment and allowing operators to perform maintenance on more dynamic schedules. It’s like the difference between changing the oil in your car every 10,000 miles as opposed to once per year regardless of how much you drove.
But the biggest productivity increases were related to equipment faults. Troubleshooting an equipment issue can often take two or three return visits, first to diagnose the issue, then to get the right parts, then troubleshoot and implement a repair.
The analytics unlocked by continuous data collection can pinpoint the root cause of issues, so operators save time diagnosing and troubleshooting the issue and bring the right parts the first time.
“Wrench time” is a calculation of how much time is spent maintaining a piece of equipment. Previously, operators spent approximately 35 hours per piece of equipment per year. Now they spend just under nine hours per piece of equipment per year, a 75% reduction.
Those time savings have allowed the property to avoid deferred maintenance despite the reduction in staff.
2. Office portfolio implementing cost savings to increase net operating income
The Problem
Relative to rent and occupancy, operating expenses were an afterthought for asset managers
There are only two in-house engineers overseeing dozens of properties
On-site operations are outsourced to different teams in different regions, making transparency and reporting very difficult
Slowing rent growth forced the portfolio to investigate alternative value streams
Early attempts to deploy “energy management systems” failed to achieve the desired return on investment
The Solution
Energy management systems are designed to tap into the existing infrastructure: the utility meters and the building management system (BMS). The problem is that utility meters only provide building-level data which is an insufficient level of granularity to drive action. BMS are often a good source of data, but they rarely tell the whole story and can be broken themselves.
In this case, a combination of BMS and equipment monitoring sensors provided the granularity and context to identify optimizations that immediately contributed to increased cash flow.
Within 10 weeks on average, changes worth 36.5 cents per square foot had been implement across the portfolio. The most common insights were HVAC systems that were on when the buildings were unoccupied, instances of properties being simultaneously heated and cooled, and pumps that were unnecessarily run at 100% capacity.
3. Office portfolio tying together siloed systems and documentation in one platform
The Problem
In most commercial portfolios, keeping track of warranties, parts, maintenance manuals, nameplate information and service agreements is a constant struggle
When it comes to software, there are multiple siloed systems for the BMS, work orders, and property management
There’s no easy way to train new operators on the specifics of a building, especially with the challenges of COVID-19
The Solution
Not all use cases require sensor installations. Value can be created by simply digitizing the static documentation that building operators need daily and making it easily accessible. The alternative is documents taped to equipment, shoved in filing cabinets or lost entirely.
Likewise, in more sophisticated portfolios that have robust technology for work order management, equipment controls, and property management, there is a tendency for different roles to develop expertise in one system and rely on others for information that should be easily accessible.
Ultimately, the goal is for anyone in the organization to be able to get the answer to any question they may have.
The solution is to create a central and digital repository of all documentation, which also pulls in data from the disparate siloed systems.
Making that repository a virtual replica of the building interior has also significantly decreased new operator onboarding time.
4. Office portfolio digitizing tenant submetering
The Problem
Tenant submetering is often a headache for commercial owners
Small typos lead to discrepancies in billing and tension with tenants
Spreadsheets have versioning issues and there’s no central repository of bills from the utility or to tenants
Submetering infrastructure is all over the place; some meters must be manually read, others are digital and remotely readable
The Solution
Tenant meter readings used to be paper-based. Writing down numbers on clipboards, transcribing those to spreadsheets and then again to bills creates plenty of opportunities for human error.
The solution is simple. Input the readings directly into a mobile app (and take a photo for verification) so the information is digital and can be connected to billing software. The Enertiv Meter Reading App even has basic validation so if you type in an obviously wrong number, it will alert you in real time.
One of the side benefits of this is that in the process of taking meter readings, the infrastructure itself is getting documented. This may not seem like much, but it’s critical for creating a plan to upgrade the infrastructure to entirely remotely readable submeters so that the entire process front to back can be automated.
5. Office portfolio generating higher yields in value-add fund by capturing untapped value
The Problem
Value add acquisitions are all about capturing untapped revenue streams and wisely investing capital into property upgrades
Cost saving technologies have often been ignored because the return on investment does not make sense with short hold period
The Solution
In long-term “Core” investments, an argument can be made that the more data captured and analyzed, the better. As highlighted above, there are opportunities to automate data entry by on-site staff and optimize how equipment are operated.
But when it comes to value-add investments, payback period is the name of the game. It’s often worth forgoing some significant sources of value because they will accrue over several years in favor of targeting investments that will payback in 12-24 months.
How can this be accomplished at scale? Our solution is to use the Enertiv Survey App to quickly understand a building’s infrastructure and develop a scope of work that targets the biggest cost drivers.
From there, we can deploy sensors to track the equipment that is most likely to deliver large and easily implemented cost savings. Value add properties are particularly good candidates because there is often a history of deferred maintenance and issues with HVAC schedules.
On average, this approach delivers a 400% return on investment with a payback of 15 months.
6. Mixed use office + retail portfolio reducing risk associated with leaks and floods
The Problem
Plumbing infrastructure near outside air intake had the tendency to freeze and burst during cold winter months
The solution was expensive and still reactive – paying engineers to sleep on-site during the coldest nights to be ready in case of emergency
Water damage is the most common insurance claim in commercial real estate
The Solution
The solution is quite simple. Instead of paying operators overtime to sleep on-site in case anything goes wrong, monitor temperature using sensors and send notifications to operators’ phones when temperatures begin dropping.
This is an extreme case of the disparity between acting proactively and reactively. The solution to a pipe that is approaching freezing is often simple, such as closing a vent to the outdoor air. On the other hand, even if you’re in the building when a pipe freeze and burst occurs, it is a monumental undertaking.
Previously, a portfolio of 20 buildings in New York City would experience at least one major incident each winter. There have been no incidents since data has started to be collected despite 18 “warning” notifications.
7. Multifamily portfolio holding elevator maintenance vendors accountable
The Problem
Elevator repair costs can take up a significant portion of the budget
Entrapments are a severely negative experience for tenants
Owners and operators often know their elevator maintenance vendors are not doing the work stipulated in their contract
There’s no transparency into when vendors arrive or what exactly they do on-site
The Solution
There are two parts to this equation. First, the work orders submitted by maintenance vendors, including the time spent maintaining each elevator. Second, the sensor data capturing real-time data about those elevators.
It may go without saying that elevators need to be shutdown to be maintained. Combining these two datasets allows the software to calculate how much of the vendors claimed hours can be verified by the equipment performance data.
Rolling this data into a platform allows the portfolio to hold vendors accountable, compare performance across vendors and ultimately deliver a better experience to tenants.
After this was implemented, the portfolio saw a 300% increase in verified preventative maintenance, which subsequently translated to a 75% decrease in entrapments and 25% decrease in repair expenses.
8. Multifamily portfolio implementing a “BMS-lite” for a fraction of the cost of a traditional BMS
The Problem
BMS generally can cost $2 to $8 per square foot to install, along with recurring maintenance and updates
This is far outside of the budget of most multifamily properties
These properties could benefit greatly from fault detection and efficiency insights
The Solution
BMS cost so much because of the time it takes to install and provision thousands of data points throughout the building, connecting these data points to controls and setting up the correct settings, and ensuring that the system is protected from a cybersecurity perspective.
For the purposes of multifamily owners and operators, this level of sophistication isn’t necessary. A better strategy is to deploy equipment performance sensors to track the critical equipment that drives costs and tenant complaints.
Because this data is less expensive to capture and does not have to be connected to controls, the costs can come down to around 12 cents per square foot, a mere 6% of the cost of an inexpensive BMS.
9. Multifamily portfolio identifying energy retrofit opportunities and reporting on ESG metrics
The Problem
ESG and sustainability are becoming mission critical for commercial real estate portfolios
There are endless possible retrofit opportunities but it remains difficult to evaluate the ROI assumptions in proposals
In New York City, buildings are now mandated to post energy efficiency grades in their lobby
The Solution
ESG reporting has become an industry in and of itself. Unfortunately, many are realizing these dashboards, derived from building-level data, only provide “nice to know” information, not actionable insights.
The solution is to capture data at the equipment level. This data can be valuable in identifying possible energy retrofit as well as validating the assumptions of outside retrofit proposals.
When it comes to reporting, suddenly benchmarking can be done on the equipment level, not just at the building level. Because soon, reporting won’t be enough, it will be necessary to develop a strategy for deep energy reductions.
10. Industrial portfolio differentiating their assets to tenants with smart building capabilities
The Problem
The competition for industrial assets is heating up
Ecommerce companies are constantly pushing the bounds of technology, they’re expecting their spaces to be smarter
At the same time, many tenants need to be educated on the benefits of smart buildings, which is not something many leasing agents are comfortable with
The Solution
When it comes to smart building capabilities in industrial properties, there are multiple channels of value. First and foremost, there are the standard benefits of reduced maintenance and utility costs.
But in addition to providing on-site operators with the tools they need to cut costs, sensor data can help squeeze more productivity out of the existing space with by calculating granular utilization rates.
Real-time and historical occupancy data within the property and in the parking lot can help pinpoint areas of underutilization. This information can be integrated into planning meetings to make better use of the space through improved design.
Furthermore, efficient dock processes are critical to an optimized supply chain. Sensor data about door dock activity can answer questions such as: what’s the impact on the business when goods arrive outside the expected delivery date? How do processes hold up during peak activity events?
The data can be sliced and diced by time of date, over periods of time and by each individual door dock. This wealth of information can inform data-driven decisions around schedules and process improvements.
If any of these use cases sound familiar, we’d be happy to provide a demo video of the platform.
