SPARK16 Presentation: Connecting Facilities Performance Data with Your Real Estate Investment...
-
Upload
urjanet -
Category
Data & Analytics
-
view
237 -
download
0
Transcript of SPARK16 Presentation: Connecting Facilities Performance Data with Your Real Estate Investment...
Connecting Facilities Performance Data With Your Real Estate
Investment StrategyDavid Metcalfe
CEO Verdantix
Connecting Facilities Performance Data With Your
Real Estate Investment Strategy
September 15, 2016
David Metcalfe, CEO at Verdantix
3
Verdantix is an independent research and consulting firm with expertise in emerging technologies for EHSQ, real estate, facilities and energyThrough our research and advisory services we help corporate managers, investors, technology executives and services firm leaders to make robust, fact-based decisions. We are committed to delivering objective, timely, and accurate analysis to help our clients succeed.
4
Theme
You need an information management strategy that integrates energy data with
other facility-level performance data
5
Agenda
• Why do you need an information strategy that integrates energy data with other facility data?
• Who is implementing strategies that take advantage of multi-dimensional facility-level data?
• How will the market for facilities optimization management software evolve over the next 5 years?
6
Energy Efficiency Software Propositions Run Into Four Financial And Organizational Barriers
Spend on electricity not increasing in aggregate
Energy spend small as % firm-wide opex
Energy programs are complex to implement
Owner/tenant split incentives
7
Two Thirds Of Energy Managers Expect Spend To Stay Flat Or Decline In 2017
67% no change
or reducing
Source: Verdantix “Global Energy Leaders Survey 2016: Budgets And Priorities”, June 2016
N =250
8
The Facilities View Of Energy Costs Is Not in Tune With The CFO’s View
Source: American Iron & Steel Institute, BOMA, Capgemini, EPA, National Grid
Ener
gy S
pend
As %
Tota
l Ope
ratin
g Co
sts O
r Ass
et O
pera
ting
Cost
s
Facilities View Energy spend
as % asset opex
CFO ViewEnergy spend as %
firm-wide opex
9
Build A Business Case On Total Facilities Opex Including Space Costs Not Just Utilities
Source: BOMA, thesquarefoot.com, RMI
Assumption$7.50 / sq ft on
operating expenses
6% on utilitie
s
5%
5%Assumption $1.65 / sq ft on utilities
10
Build A Business Case On Total Facilities Opex Including Space Costs Not Just Utilities
Source: thesquarefoot.com
3%
3%
5%
2%
11
Delivering Energy Efficiency Programs Is Complex
Source: Verdantix “Global Energy Leaders Survey 2016: Budgets And Priorities”, June 2016
N =250
12
Onsite Generation Makes Energy Programs Even More Complex
Source: Verdantix “Global Energy Leaders Survey 2016: Budgets And Priorities”, June 2016
N =250
13
Building Owner / Tenant Split Incentives
10-30 years 3-10 yearsTime perspective
Cost BenefitCapital upgrades
Low relevance Varied relevanceGHG emissions & sustainability
Maximize yield Minimize cost per sq ft or per employeeFinancial concept
Building Owner Tenant
14
Building Energy Management Software Market Is Fragmented With Vendors Struggling To Get Critical Mass
Source: Verdantix “Green Quadrant Building Energy Management Software”, October 2015
15
Problems For Information Management Strategies Focused Exclusively On Energy
• Flat or falling electricity prices which undermine the rationale for energy efficiency programs
• Insufficient energy experts to generate value from complex analytics and project tools
• Energy and facilities services firms acting as a barrier to stand alone software implementation
• Problems establishing brand awareness and relationships with diverse owners of energy management
• Low barriers to entry impacting profit margins and the potential to grow the business
• Dwindling investor interest in the sector requiring growth through cash flow
Source: Verdantix “The Future Of Building Energy Management Software”
16
The Value Of Energy Data Alone Will Not Get This Ecosystem Over The Chasm
Source: Geoffrey Moore “Crossing The Chasm”
BEMS
17
Agenda
• Why do you need an information strategy that integrates energy data with other facility data?
• Who is implementing strategies that take advantage of multi-dimensional facility-level data?
• How will the market for facilities optimization management software evolve over the next 5 years?
18
Broader Facility Level Factors Already Influence Energy-Centric Facility Optimization Plans
Source: Verdantix “Global Energy Leaders Survey 2016: Budgets And Priorities”, June 2016
N =250
19
A Broad Facilities Optimization Software Offering Overcomes The Challenges Facing BEMS Vendors
Undermines business case Minor impact on ROIFlat electricity prices
Energy Software Offering
Facilities, Energy & Maintenance Offering
ROI hard to achieveProposition focuses on
ubiquitous facilities directors
Lack of energy experts
Block direct sales of energy software / sell
own
Provide systems integration and act as
channel partnersRole of facilities
firmsScattergun, complex
sales processesSales focus on facilities
and maintenance directorsVaried job titles responsible for
energyVery low due to hosted apps and cheap sensors
Moderate due to complex data sets and analytics
Barriers to entry for software
Close to zero due to lack of success story after 15
yearsGrowing due to multiple
success stories Investor interest
20
Facility Optimization Strategies Create Data Cubes Which Offer More Valuable Insights
Source: IBM
Site-by-site variances in
back charging for space usage
Upper quartile electricity costs
per sq ft normalized for location and
external temperature
Benchmark of retail store
lifecycle costs from acquisition
to disposition
Correlation between
maintenance work order
completion time and space occupancy
Multi-dimensional
benchmark of facilities
services agility
Utility costs and non-
utility costs as % of lease costs and per
employee
21
University of Central Florida
Source: AssetWorks, UCF
Vital StatsFounded 1963
60,000 students10,700
employees
1,500 acre site186 buildings
12m sq ft
Challenges• Legacy CMMS no longer fit for
purpose• Unable to run maintenance
reports• Political pressure to be more
efficientKey Project Insight
Data structure of the AssetWorks AiM system was far more comprehensive than CMMS point solutions enabling more powerful analysis
22
Telefonica
Source: Archibus, Telefonica
Vital Stats120,000
employees$60bn revenues
7,500 buildings in Spain
40 million sq ft
Challenges• Property data in Access database• 12,500 CAD drawings in different
systems• Internal resistance to changes• 1 work request every 2 minutes
Key Project InsightLarge-scale data standardization, aggregation and systems integration project delivered cumulative EUR 968 million in savings in 3 years from space rationalization
23
Ball Aerospace
Source: Archibus, Telefonica
Vital StatsSubsid of Ball Corp
$15bn revenues15,000 employees
34 leased and owned buildings in
US1.4 million sq ft
Challenges• Leases on paper and in financials in
Excel• Utilities costs in separate systems• Space management data logged in
Excel• Very slow turnaround time on
reportingKey Project InsightData standardization and aggregation increased space and utilities data accuracy from 70% to 99%. Big savings from linking utilities data to lease records in a single report.
24
Danfoss
Source: Planon, Danfoss
Vital StatsFounded 1933
EUR 5bn revenues24,000 employees
300 locations 16.1 million sq ft
Challenges• Global Services: 15 real estate
systems• Slow to respond to internal
stakeholders• Lack of comparability for FM costs• Meeting real estate compliance
needs Key Project InsightConsistent, high quality repository of worldwide real estate master data has enabled Danfoss Global Services to implement a charge back model based on pay per use.
25
Real Estate & Facilities Information Management Landscape
Centralized Maintenance Management Systems
Building Energy Management Software
Computer Aided Facilities Management
Integrated Workplace Management System
Facilities Optimization Management System
Lease Management Software
Brea
dth
of F
uncti
onal
ity
26
Agenda
• Why do you need an information strategy that integrates energy data with other facility data?
• Who is implementing strategies that take advantage of multi-dimensional facility-level data?
• How will the market for facilities optimization management software evolve over the next 5 years?
27
Five Predictions For The Next Five years
#1 IWMS will be the convergence platform
#2 Energy software will fragment into customer specific
niches #3 Private equity investment
in IWMS will ramp up#4 Systems integrators and real
estate consultants will turbocharge the market
#5 Social media platforms will become a essential element of
IWMS platforms
28
#1 IWMS Platforms Will Consolidate All Facilities And Real Estate Information Management Functionality
Energy Asset Management
Maintenance Lease Management
Space & Occupancy
29
#2 Energy Software Will Fragment And Get Subsumed
Energy Management Software
Building Energy
SMB Energy Reporting
Energy Use, Generation &
Storage
Industrial Energy
Efficiency
Carbon Emissions Reporting
IWMS Utility CRMDecentralized
Generation Asset Mgt
Manufacturing Execution Systems
EHS Platform
30
#3 Private Equity Investors Will Boost The IWMS Market As It Has Crossed The Chasm
Source: Geoffrey Moore “Crossing The Chasm”
IWMS
31
#4 Systems Integrators Will Turbocharge The IWMS Market
Complex IWMS
software platforms
Real estate consultants and systems integrators
CFO, CIO, VP Real Estate
convinced of value prop
$5m to $10m software and
services deals
Growth investors and
large tech firms fund
product dev
32
#5 Social Media Functionality Will Differentiate IWMS Platforms
• Founded in 2008. Valued at $16bn• Social media firm that runs real estate
assets• 77 locations, 300 planned for 2017 and
2018
33
Real Estate & Facilities Information ManagementResearch Solution
MARKET COVERAGE DELIVERABLES• Integrated Workplace Management Systems
(IWMS)
• Building energy management software
• Computerized Maintenance Management Systems (CMMS)
• Smarter buildings and Internet of Things (IoT)
• Real estate and facilities management technologies
• Integrated facility management software
• 20 new real estate and facilities information management reports published per calendar year
• Analyst Inquiry service to discuss real estate and facilities software topics with Verdantix analysts
• Quarterly webinar focused on real estate and facilities software market trends and regulatory issues
• Where appropriate, inclusion in Verdantix reports, email newsletters, blog posts and press releases
Thank you!David Metcalfe