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5G and commercial
real estate:
what the future
may hold

Author: Megan Williams

5G and commercial real estate are at a fascinating crossroads.

A sector that once stressed location, location, location is responding to new demands for communications technology and data, and the connection between them will shape the next wave of commercial real estate trends. New use cases for 5G and commercial real estate are on the horizon—cases that can help executives and property managers make smart decisions when incorporating 5G infrastructure into their properties.

Considerations for 5G and commercial real estate

5G will not just support trends in commercial real estate. It could transform how the industry works.

Consider Internet of Things (IoT)-enabled building management systems. 5G will eventually support increased IoT device use through the real-time connectivity its low latency and high bandwidth enable, meaning building managers could deploy IoT-enabled systems to garner insights about how they can make their buildings more energy-efficient, for example, the ability to  predict elevator maintenance needs. 5G can also enable more efficient use of existing technologies during building construction, too. It could facilitate remote operation of heavy machinery across multiple building sites, for instance.

At the same time, 5G is likely to influence tenant demands and expectations. It has happened before—consider how the business need for lower-latency video conferencing pushed demands for faster connections—and it will continue to happen as the remote workforce expands and communication speed becomes more critical. Remote connectivity needs are likely to increase as remote work and automation become more attractive to businesses in multiple sectors, the Certified Commercial Investment Member Institute says—and 5G can meet those needs.

5G is now driving decisions in commercial real estate. Cellular carriers are bringing 5G technology to customers worldwide, expanding available connectivity options. For some property owners and developers, the combination of 5G and real estate will force new questions, such as whether the network could ever replace Wi-Fi. Understanding the nuances in these applications will be critical to staying ahead of customer interest and aligning with market expectations.

The value add of 5G and commercial real estate

To understand the value of 5G and commercial real estate—and why you should start building your 5G infrastructure—consider these applications.

Smart buildings and the smart city

Smart cities will be built on the back of smart buildings—buildings connected by a vast network of sensors that send data to machine learning and/or artificial intelligence compute elements to collect detailed insights that are then fed back to modify sensor or system behavior or channeled to human analysts for further action. These buildings could usher in a new era of smart real estate that sees buildings shift from static, cost-absorbing structures to dynamic entities that foster innovation and deliver an improved user experience. These buildings will be crucial parts of smart initiatives, and they will need the streamlined communications and seamless data transmission that can 5G provide.

IoT deployment

Those same smart initiatives will depend heavily on the deployment of IoT devices. Though the IoT works with 4G technology, 5G will eventually exponentially increase its capabilities by allowing for a far greater density of connected devices.

On the surface, IoT simply connects smart devices and lets them communicate with one another. But it could help improve commercial real estate in specific ways, such as:

  • Improving HVAC and lighting efficiency
  • Reducing bottlenecks and improving wayfinding
  • Enhancing the employee experience through smart elevators, conference room scheduling and parking lot sensors
  • Optimizing the workplace by tracking how employees utilize space

New monetization avenues

5G also opens new revenue opportunities for property owners. Leases for small cell towers on parking decks, rooftops or even light poles could be new sources of revenue. Cell tower lease rates vary, but owners who lease space will have growth opportunities.

Stepping into 5G and commercial real estate

The journey into 5G and real estate will likely rely on investments into specific infrastructure on the part of network providers, including:

  • Increased fiberization
  • Small-cell indoor and outdoor densification
  • New spectrums of coverage bands
  • Core features such as network-function virtualization and control and user plane separation

Riding the wave of 5G and commercial real estate will involve significant education and strategic planning to how 5G's broad potential could help you reach your goals.

In a space this complex, leaning on a managed services partner that understands the technology and its broad applications can provide a major competitive advantage.

Learn how Verizon 5G can drive business performance.