Real Estate Predictions 2021 - 5G as an enabler for new and 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 and smarter ways of working Implications for real estate and construction
5G as an enabler for new and smarter ways of working | Real Estate Predictions 2021 2
5G as an enabler for new and 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 behaviors, 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 and smarter ways of working for all of us.
The need for speed, latency, reliability, (AI), Augmented & Virtual Reality (AR & VR) AI to optimize quality control and risk
and capacity and Digital Twins all of which could have escalation processes, and increase the use
For the last several years, 4G – which was a significant impact in digitalizing various of 3D printing to create standard building
itself revolutionary at its introduction sectors – the sky is ”virtually” the limit. components. It could improve information
around 2010 - has served our society well. storage, progress tracking and automated
However, our demand for accurate and fast Unsurprisingly, the rollout has been project controls. And track and trace supply
data is growing exponentially, and inherent impacted by trade and tech disputes chain logistics could support ”just in time”
limitations relating to speed, latency, regarding certain 5G equipment and by delivery and minimize corruption.
reliability, and capacity are becoming the outbreak of COVID-19 for reasons
more and more apparent. 5G mobile including a reduced consumer demand The most significant benefit for the
internet is a major leap forward from 4G. (due to the increased Wi-Fi usage working construction industry will most likely be
If its full potential is realized, it will not only from home), allegations linking 5G rollout 5G’s ability to take Building Information
address 4G’s limitations, but will transform with the COVID-19 spread, and lack of Modelling (BIM) to the next level, which
the way we live, work, travel and play. understanding concerning the benefits of will enhance the potential for fully
5G. confederated 6D Models and enable
5G operates over much higher radio the creation of a cloud-based ”digital
frequencies than 4G, which requires the Implications for real estate and twin”. This will support more efficient
substantial upgrade, and addition of, cell construction delivery, integration and better decision
towers. Higher frequencies require the Numerous industries have made making throughout the building lifecycle
closer proximity of cells, meaning that significant digital transformation strides from concept design through to
”small cell sites” will need to be added to with 4G capability. What are the benefits decommissioning. Further, the creation of
buildings, light poles and other structures of 5G? How can real estate leverage this these models will allow clients to ”look and
across the country. Network providers are new technology to accelerate digital feel” their projects earlier in the delivery
building this high speed infrastructure at transformation within an industry that process.
pace though, to date, the initial commercial is well behind others? Let’s explore the
application for the 5G rollout has centred answers to these key questions further. Low latency
upon mobile broadband. 5G is expected to reduce latency2 in the
Greater network speeds order of 1 millisecond3. In other words, 5G
More to come Standard 4G provides a maximum response times will feel instantaneous4.
The first 5G networks were launched in potential real world speed of around The implementation of IoT in real estate
2019 and were largely deployed from 80Mbps whereas 5G could reach peak is progressing at a rapid pace, with
existing 4G base stations. Since then, speeds of 10-20Gbps1. In combination more and more new buildings being
various major network organizations with increased bandwidth, improved specified with sensors inside and out. 5G
have also launched 5G mobile network network speeds could greatly enhance will enable instantaneous connectivity
capability in a limited number of cities construction processes. For instance, to real time building usage data and
and towns. There is much more to come the remote use of VR could support infrastructure, providing scope for accurate
- 5G could solidify the business case for communicating ideas to project teams in tenant occupancy data and optimized
transformational technologies such as the an agile setting. Also, 5G could increase the maintenance regimes on assets. In the
Internet of Things (IoT), Artificial Intelligence use of off-site manufacturing, unlocking future, landlords may take advantage of
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]
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5G as an enabler for new and smarter ways of working | Real Estate Predictions 2021
private 5G splicing (i.e. pay for what you In time, collecting and interpretation of 5G offices could create enhanced revenue
use, down to the device) to increase yields data produced by real estate assets will opportunities for landlords through
by offering bespoke services to their become a defensive strategy for most real different types of leasing models. Business
tenants. The potential for building assets estate stakeholders. It will help them to models of flexible office operators, booking
with wire-free connections instead of Wi-Fi maintain an edge over their competitors. desks and meeting rooms with specific
could radically reduce the implementation Also, more regulatory requirements are digital capability, may become more
complexity of core building management imposed by governments to encourage common as 5G networks expand.
systems (including fire, security, lighting, the use of 5G technology, as it will increase
HVAC and energy/utilities). productivity and efficiency and improve Key observations
sustainability performance. 2020 may have slowed down the 5G
Faster response times between devices will technology revolution, but it has also
also allow for the more widespread use of Challenges further highlighted the need for improved
autonomous vehicles and the associated It is important to factor into any business connectivity, greater network speeds,
transport infrastructure. With more people case the challenges involved with reduced latency and wider bandwidth
working from home, 5G connections optimizing 5G and the various technologies capacity to support digital transformation.
may soon replace the need for Wi-Fi. it enables. These include but are not limited Although there are challenges in
Valuation of 5G technology infrastructure to: implementing 5G and no doubt greater
will have to be considered within future speeds will soon exceed it, the economic
development appraisals to enhance value • shorter frequency waves requiring small and social benefits will outweigh the costs.
and marketability. cell site technology with antennas as The real estate sector has the ”bandwidth”
close as 500 feet apart to reap some of the greatest benefits from
High capacity its implementation.
More bandwidth and data capacity would • higher risk of obstacles (including building
reduce competition for connection and materials) blocking or disrupting high Authors
would allow the support of up to one frequency 5G signals Scott Dudley
million devices per square kilometer2. 5G Director | Financial Advisory | UK
combined with big data applications and • many devices that will need to be 5G sdudley@deloitte.co.uk
cloud storage capabilities could increase enabled, e.g. better battery technology
data on space utilization, power and Peter Adeleye
energy consumption. A much-needed retail • GDPR legislation and privacy laws that Consultant | Financial Advisory | UK
revolution could start with VR and AR to may limit 5G optimization. peteradeleye@deloitte.co.uk
create experiential retail environments and
be further developed by in-store analytics 5G as an enabler for workplace Contact
to personalize shoppers’ experiences. transformation Andrew Carey
Big data applications could also support As pre-existing working patterns continue Partner | Financial Advisory | UK
the continued effort to enforce social to shift, 5G could further consolidate the ancarey@deloitte.co.uk
distancing as more offices and retail outlets workplace transformation. Fully integrated
open.
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