Real Estate Predictions 2021 - 5G as an enabler for new, smarter ways of working Implications for real estate and construction - Deloitte
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Real Estate Predictions 2021 5G as an enabler for new, smarter ways of working Implications for real estate and construction
5G as an enabler for new, smarter ways of working | Real Estate Predictions 2021 2
5G as an enabler for new, smarter ways of working | Real Estate Predictions 2021
2020 has been a tumultuous year full of seismic shifts in everyday norms. In a year
marked with greater public scrutiny of embedded social structures and behaviours, it
is easy to forget that another impactful infrastructure change is quietly taking place.
The next wave of digital disruption is on course and the 5G rollout will be the enabler.
5G will be the ”glue” that will tie all of our devices, buildings, and cities together,
enabling new, smarter, ways of working for all of us.
The need for speed, latency, reliability, (AI), Augmented & Virtual Reality (AR & VR) components. It could improve information
and capacity and Digital Twins all of which could have storage, progress tracking and automated
For the last several years, 4G – which was a significant impact in digitalizing various project controls. And track and trace supply
itself revolutionary at its introduction sectors – the sky is ”virtually” the limit. chain logistics could support ”just in time”
around 2010 - has served our society well. delivery and minimize corruption.
However, our demand for accurate and fast Unsurprisingly, the rollout has been
data is growing exponentially, and inherent impacted by trade and tech disputes The most significant benefit for the
limitations relating to speed, latency, regarding certain 5G equipment and by the construction industry will most likely be
reliability, and capacity are becoming more outbreak of COVID-19 for reasons including 5G’s ability to take Building Information
and more apparent. 5G mobile internet a reduced consumer demand (due to the Modelling (BIM) to the next level, which
is a major leap forward from 4G. If its full increased Wi-Fi usage working from home), will enhance the potential for fully
potential is realized, it will not only address allegations linking 5G rollout with the confederated 6D Models and enable
4G’s limitations, but will transform the way COVID-19 spread, and ack of understanding the creation of a cloud-based ”digital
we live, work, travel and play. concerning the benefits of 5G. twin”. This will support more efficient
delivery, integration and better decision
5G operates over much higher radio Numerous industries have made making throughout the building lifecycle
frequencies than 4G, which requires the significant digital transformation strides from concept design through to
substantial upgrade, and addition of, cell with 4G capability. What are the benefits decommissioning. Further, the creation of
towers. Higher frequencies require the of 5G? How can real estate leverage this these models will allow clients to ”look and
closer proximity of cells, meaning that new technology to accelerate digital feel” their projects earlier in the delivery
”small cell sites” will need to be added to transformation within an industry that process.
buildings, light poles and other structures is well behind others? Let’s explore the
across the country. Network providers are answers to these key questions further. Low latency
building this high speed infrastructure at 5G is expected reduce latency2 in the
pace though, to date, the initial commercial Greater network speeds order of 1 millisecond.3 In other words, 5G
application for the 5G rollout has centred Standard 4G provides a maximum response times will feel instantaneous.4
upon mobile broadband. potential real world speed of around The implementation of IoT in real estate
80Mbps whereas 5G could reach peak is progressing at a rapid pace, with
More to come speeds of 10-20Gbps.1 In combination more and more new buildings being
The first 5G networks were launched in with increased bandwidth, improved specified with sensors inside and out. 5G
2019 and were largely deployed from network speeds could greatly enhance will enable instantaneous connectivity
existing 4G base stations. Since then, construction processes. For instance, to real time building usage data and
various major network organizations the remote use of VR could support infrastructure, providing scope for accurate
have also launched 5G mobile network communicating ideas to project teams in tenant occupancy data and optimized
capability in a limited number of cities an agile setting. Also, 5G could increase the maintenance regimes on assets. In the
and towns. There is much more to come use of off-site manufacturing, unlocking future, landlords may take advantage of
- 5G could solidify the business case for AI to optimize quality control and risk private 5G splicing (i.e. pay for what you
transformational technologies such as the escalation processes, and increase the use use, down to the device) to increase yields
Internet of Things (IoT), Artificial Intelligence of 3D printing to create standard building by offering bespoke services to their
1 House of Commons Library, 5G Briefing Paper 2019, 6 September 2019, page 4.
2 Latency is the time taken for devices to respond to each other over the wireless network.
3 4G is around 30 milliseconds
4 Ofcom, What is 5G, 9 March 2018; [accessed 28 November 2020]
3
5G as an enabler for new, smarter ways of working | Real Estate Predictions 2021
tenants. The potential for building assets In time, collecting and interpretation of 5G as an enabler for workplace
with wire-free connections instead of Wi-Fi data produced by real estate assets will transformation
could radically reduce the implementation become a defensive strategy for most real As pre-existing working patterns continue
complexity of core building management estate stakeholders. It will help them to to shift, 5G could further consolidate the
systems (including fire, security, lighting, maintain an edge over their competitors. workplace transformation. Fully integrated
HVAC and energy/utilities). Also, more regulatory requirements are 5G offices could create enhanced revenue
imposed by governments to encourage opportunities for landlords through
Faster response times between devices will the use of 5G technology, as it will increase different types of leasing models. Business
also allow for the more widespread use of productivity and efficiency and improve models of flexible office operators, booking
autonomous vehicles and the associated sustainability performance. desks and meeting rooms with specific
transport infrastructure. With more people digital capability, may become more
working from home, 5G connections Challenges common as 5G networks expand.
may soon replace the need for Wi-Fi. It is important to factor into any business
Valuation of 5G technology infrastructure case the challenges involved with Key observations
will have to be considered within future optimizing 5G and the various technologies 2020 may have slowed down the 5G
development appraisals to enhance value it enables. These include but are not limited technology revolution, but it has also
and marketability. to: - further highlighted the need for improved
connectivity, greater network speeds,
High capacity • shorter frequency waves requiring small reduced latency and wider bandwidth
More bandwidth and data capacity would cell site technology with antennas as capacity to support digital transformation.
reduce competition for connection and close as 500 feet apart Although there are challenges in
would allow the support of up to one implementing 5G and no doubt greater
million devices per square kilometer. 5G • higher risk of obstacles (including building speeds will soon exceed it, the economic
combined with big data applications and materials) blocking or disrupting high and social benefits will outweigh the costs.
cloud storage capabilities could increase frequency 5G signals The real estate sector has the ”bandwidth”
data on space utilization, power and to reap some of the greatest benefits from
energy consumption. A much-needed retail • many devices that will need to be 5G its implementation.
revolution could start with VR and AR to enabled, e.g. better battery technology
create experiential retail environments and Authors
be further developed by in-store analytics • GDPR legislation and privacy laws that Andrew Carey
to personalize shoppers’ experiences. may limit 5G optimization. Partner | FA - Real Estate | UK
Big data applications could also support ancarey@deloitte.co.uk
the continued effort to enforce social
distancing as more offices and retail outlets Contacts
open. Russell McMillan
Partner | FA - Real Estate | UK
rmcmillan@deloitte.co.uk
4
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