THE impact of technology is set to redefine many of the yardsticks by which the value of buildings for commercial use have traditionally been judged, as well as signalling the possible demise of the trophy building concept.
Issues other than decentralisation, which prompted many trophy developments as monuments to corporate achievement, have come into play in the property arena, says Ian Watt, MD of Old Mutual Properties.
"Business structures are changing. So is the way business is done. We live in a mobile era with technology at its heart."
Watt says the question arises as to whether offices and buildings that are vacant and likely to be so for some time will be able to compete in a market where technology plays an increasing role.
"For decades, different criteria have been applied to judge buildings size, location, quality of structure and finishes.
"Until recently, technology has had little association with the perceived value of a building.
"Now an increasing number of owners believe that technology, automated building systems, streamlined workflow, a comprehensive broadband strategy and a focus on the 21st century tenant experience can redefine the property industry."
Their view is that the internet and the idea of a connected world have broad and significant implications for the operation and use of commercial space, he says.
New tenants who live, work and play differently by virtue of the technology they use, will come to expect a different experience, these owners say.
"Broadband, wireless, integrated digital signage, automated property management systems, high technology surveillance and security systems will someday become the norm, they believe."
Watt says the real challenge is that investment in technology can easily exceed the value of officespace cost. How and when these new concepts are introduced will depend on how fast the tenants demand them and to what extent they can improve the financial performance of a property.
"The lush gardens, the fancy tiles in the doublevolume entrance and the richly panelled meeting rooms may still have an influence.
"But the advanced facilities that enhance lifestyle, and business process and communication, will be more important to the 21st century tenant," Watt says.
"How many of our office buildings will be up to that challenge?
"And given the meagre cash flows some owners now face because of low occupancy who funds the change?"
May 15 2003 07:20:14:000AM Business Day 1st Edition
Publisher: Business Day
Source: Business Day
New breed of tenants forecast
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