Greenhouse gas (GHG) emissions are the primary driver behind human-caused climate change, and the built environment is the biggest source of these emissions. Real estate’s role in climate change is well understood by industry stakeholders and government regulators. The former have been trying for years to reduce the sector’s impact on the environment, while the latter are passing laws compelling them to try harder. But the efforts of both parties have focused on decreasing the emissions “embodied” in the materials and energy used to construct buildings, as well as on reducing the amount of energy consumed by structures once they are built. There is a third source of emissions – interior refits – that has received relatively little attention from stakeholders and regulators but that, over time, can be responsible for more emissions than both of those other categories combined.

According to data from RESET, large multinational tenants in Class A buildings renovate their office space every 8.5 years, on average. At that rate, it takes 50 years for the emissions associated with those renovations to exceed the embodied emissions from core and shell construction. For spaces that host tenants with shorter lease terms, however, the time between renovations falls to just two-and-a-half years, a rate that generates almost five times the emissions over that same 50-year period. That surpasses the total emissions from core and shell construction and building operations.

Nobody is suggesting that property owners and facility managers avoid renovations altogether. But what real estate stakeholders should be aiming for is to stretch that time between interior refits and limit the scope of renovations as much as possible. Any improvement over a space’s current “refresh rate” will greatly reduce that property’s carbon footprint in the long run, while also decreasing costs and disruption to operations.

Rein in unnecessary renovations

One of the reasons offices with a higher rate of tenant turnover undergo more frequent renovations is that occupants want to tailor the space to their organization’s culture and work style. This can involve new paint, furnishings and flooring, as well as the construction or removal of interior walls. Stakeholders can avoid the cost, emissions and disruption to other tenants these refits entail by instead adopting movable partitions, adaptable furniture layouts and “evergreen” surfaces, colors and textures. Utilization data from Internet of Things (IoT) devices like occupancy sensors, as well as room booking information, can help FMs, owners and occupants optimize their use of these innovations.

Smart building solutions aimed at supporting the maintenance of critical building equipment can help FMs avoid the need for costly and disruptive renovations and repairs stemming from electrical, plumbing, or HVAC system failures. Other smart building technologies, like access control and visitor management systems, can protect against damage caused by vandalism or theft.

Know when it might be time for a refit

Data from smart building solutions can help companies pinpoint when an interior refit is actually needed due to things like wear and tear or outdated amenities. For example, occupancy and motion sensors, combined with a robust workplace management system, can reveal if occupants start to avoid a specific area or meeting space, stop using a particular bathroom, or steer clear of the staff kitchen. Meanwhile, access control systems can reveal if employees are spending less time at the office or taking longer breaks.

Another indicator of how occupants feel about their workspace is how frequently visitors – like prospective clients, vendors or high-profile guests – are invited to the office. Visitor management systems can not only streamline the process of welcoming those guests, but also produce reports showing the number of visitors over time. If that number drops over the course of weeks or months, it is time to try to understand why.

These utilization trends may be clues that it is time for a partial or total office refresh. Or they could indicate other problems that need to be addressed. Smart building solutions can help organizations pinpoint the root cause behind these shifts in utilization and occupancy.

Is a renovation really necessary?

FMJ Extra - Smart Building InnovationIt is human nature to be invigorated by the sight of a familiar space reborn into something new, and organizations have been known to harness the power of a fresh coat of paint to literally gloss over issues like low morale or reduced productivity. But, thanks in part to smart building technology, it is now known that some of these challenges can stem from a variety of other causes, from poor ventilation to inadequate lighting to the need for quiet space in which to focus.

Before organizations start tearing down walls and replacing the furniture, smart building technology can help stakeholders understand if the problems they identified are rooted in the workplace. Is employee productivity down because the workers need new chairs, or is it because a piece of building equipment is failing and making the space too noisy or uncomfortable to work in? Are employees inviting fewer guests to the office because they’re ashamed of its appearance, or because the process to get into the building is too onerous? The average cost of an office renovation in the U.S. ranges between $200 and $300 per square foot, according to JLL. With smart building technology, organizations can be sure that money is spent on addressing the issues they identified and not wasted on an unneeded and wasteful refit.

When it comes time to renovate, buy only what you need

Even when an organization concludes that a refit is the only way to address issues impacting its mission and employees, a complete renovation may be overkill. If the office was just repainted after a recent plumbing leak and the desks and chairs were replaced after the pandemic, throwing it all out and starting fresh would be a waste. But how do companies determine what to keep and what needs to go? Using smart building solutions to inform decisions around utilization and space optimization can not only provide insights into when a renovation is required but help define the scale and focus of the refit. This will help not only limit costs and disruption but also minimize the impact each piece of new furniture, roll of carpet or can of paint represents for an organization’s carbon footprint. For example, by understanding how occupants interact with a space, stakeholders may be able to reduce the number and type of furnishings they need to purchase for a refit.

Sensors and building automation to keep things looking and working like new

When an interior refit becomes unavoidable, it can be tempting to save money by “going cheap” on furnishings, fixtures and materials. But skimping on these things can cost companies more in the long run. Cheap furnishings tend to break more easily and wear out more quickly. More often than not, they cannot be repaired. Tossing out those broken chairs and desks after just a year or two of use is not good for an organization’s carbon footprint or bank account. After all, a $1,000 desk that will last eight years is a better value than a $500 desk that will only last three.

Once those quality furnishings, fixtures and materials are in place, sensors and building automation can help companies extend their useful life and keep them looking and working like new. For example, environmental sensors that measure temperature, humidity and light can help avoid damage due to excess moisture or dust and other particulates. In combination with a workplace management system, these sensors can be used to control window shading and ventilation, protecting surfaces from prolonged sun exposure or temperature extremes.

These same sensors, along with other smart building technology like smart meters and vibration sensors, can help reduce the need for “necessary” renovations or repairs due to water leaks, mold or damage to walls or ceilings.

Tout the tech

Multiple countries are introducing legislation addressing the built environment’s impact on the environment, and real estate companies are not the only ones subject to these sustainability-related regulations. Prospective tenants will be prioritizing spaces that help them monitor, report on and reduce their carbon footprint. Until recently, tenants sought out spaces they could “make their own” through renovations, whether minor or extensive. This mindset may shift in the face of increasing organizational, societal and governmental pressure to achieve net zero emissions, making it more likely that organizations will prioritize offices that don’t require frequent renovations. Tenants may also start to seek out offices and buildings equipped with technology to support robust compliance reporting and enable real-time emissions monitoring. Finally, offices with systems designed to help their existing furnishings and equipment last longer will have a competitive edge.

The investment in these smart building systems, then, becomes not just a practical consideration to support sustainability, cost reduction initiatives and regulatory compliance, but innovative capabilities that FMs and building owners should place front and center in the marketing of their properties.

Conclusion

With the right tools and technology, FMs can reduce the carbon footprints of real estate stakeholders by making it possible for interior refits to happen less frequently and, when they are unavoidable, ensuring that they get the most bang for their buck. These measures will also reduce costs, while in many cases increasing the marketability of their properties, enhancing occupant wellness and productivity, and helping organizations attract and retain talent at a time when sustainability is increasingly important to employees.