Turkey’s booming real estate industry is proving to be a boon for developers. However, the lack of international metrics makes it difficult to assess Turkey’s progress in this area. The Innovation Cities Index [1] ranks Istanbul in 81 position, and measures the city’s performance in 162 areas. While the Digital Country Index[2] portrays a slightly better picture and places Turkey in 18th position. The Digital Country Index tracks only the number of online searches related to exports, investments, tourism, talent and prominence. To some degree it measures the inherent potential for Turkey to digitize. When put together both indexes underscore the enormous gap between perception and reality concerning Turkey’s progress.
Bridging this gap is crucial for Turkey’s real estate boom to continue. An obvious starting point for this transformative process is to recognize that the common denominator between both indexes is Turkey’s ability to leverage digital technologies and digitize its economy. While it is true that the government should be overall owner of this process, Turkey’s developers have a key role to play, and they can start immediately. However, this requires a change in mindset and the eagerness to embrace digital solutions.
One area where developers can make marked improvements is the commercial property segment, which also includes mixed-use properties. Nevertheless, this does not imply that developers need to rush out and adopt chatbots to facilitate sales and support, invest in block chain to carry out secure transactions and buy cloud platforms to deploy software. On the contrary, commercial real estate developers need to accelerate the adoption of digital solutions that provide quick dividends such as facilities management and security solutions.
Many of today’s facilities management services are quite archaic and are all too often outsourced to third parties. By employing digital solutions that make use of air-conditioning sensors, light sensors, humidity sensors, pollen sensors, water consumption sensors, and other such devices over IoT, considerable energy saving could be made. Furthermore, if Istanbul was ever to adopt the goal of zero carbon economy, commercial building equipped with such technologies could potentially claim zero carbon credits thereby raising their green status.
Another facet of smart facilities management are intelligent parking systems, which use registered picture IDs for employees, contractors and visitors aided by facial recognition software to significantly minimise parking problems that plague most commercial sites. The same facial recognition technology integrated with mobile security drones can safeguard the premises, confront unwanted intruders, and report crime or raise an alarm for disabled persons requiring assistance. The fact that all this can happen in real time with negligible human intervention has a huge bearing on cost savings.
Hitherto, real estate developers have strongly resisted entrance into the facilities management sector for fear of high costs and low operating profits. Nevertheless, with advances in digital technologies the barrier to entry in offering smart facilities have dramatically dropped. Gone are the days, when developers solely relied on a capex business model and were extremely keen to sell the building once it was ready for service.
Today, developers are at the cusp of an excellent opportunity and can look to generate money from an opex based business model. This requires not only prudent planning at the stage of the business case but also demands investment in digital solutions and infrastructure. Those developers that are bold enough to take such steps would increase their brand value and push Turkey on an upward trajectory on international performance measures.
About the author
Abid Mustafa is a special guest writer for PropertyTR. He is a digital transformation expert and his specialism includes building digital life styles, Artificial Intelligence and Robotics. He can be contacted through PropertyTR for advisory and consulting services.
[1] http://www.innovation-cities.com/innovation-cities-index-2016-2017-global/9774 [2] https://www.digitalcountryindex.com/country-index-results
