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Intelligent Buildings Desirable in Changing Communications Field.

In this session on "intelligent buildings" I would like to give some insight into the various players who will be the most involved in this all important area and be the leaders in the many technological advances.

Let me begin by giving you some of my assumptions. First of all, your companies that you work for are tenants in the buildings in which they conduct business. Secondly, you as telecommunications managers don't play a significant role in selecting the location of your various buildings and offices. The bottom line is that someone else is making the technology decision for your building that you're located in. My purpose is to enlighten you on who is responsible for making your companies' intelligent buildings decision.

About 85 percent of the millionaires in the United States became wealthy through real estate. The building industry is an industry that is run by a bunch of entrepreneurs who are willing to take a chance and gamble. Most buildings are usually bought on speculation. The entrepreneur goes out and buys land. Then they go to some bank or lending institution which is especially important when looking at longer-term projects. The next step is to hire a general contractor who is knowledgeable of the type of building you want and the area that it's slated for. A good general contractor that you can work with closely is invaluable because of all the problems and hitches that develop along the way in putting a building together.

Change in Planning for Intelligent Buildings

What I would like to do now is give you an idea on how planning for intelligent buildings is changing and the key to this is through something called shared-tenant services. Shared-tenant services and technology are something that must work hand in hand for intelligent buildings to be successful.

When you look at the technology that is associated with the building, what's beginning to happen is there is growing concern about the merging of the various technologies. Let's focus on a building that would be used for telecommunications. We would need PBXs, voice store-and-forward, videoconferencing and much more. So one of our key considerations when building is making sure there is a telecommunications system in place that will handle whatever capacity is needed. Another area that must be addressed is building controls, which is basically a monitoring system that is installed to ensure that things run smoothly. An example of when building controls would go into effect is when a group of lawyers need to work into the night working on some briefs during the summer. They would probably want the air conditioning on so proper building controls would take care of this. A good developer would recognize a revenue stream by installing a PBX that can be controlled by a telephone. So when the lawyers come in all they would have to do is pick up the phone and dial some required code and it would activate the air conditioning. When they were ready to leave they could dial the same code, which would tell the air conditioning system to turn off. From the developers point of view, this is important because the air conditioning can then be added onto the telephone bill. Building controls are slowly but surely being put together with telecommunications. An important point is that you need people to manage that technology and traditionally, a developer doesn't make any extra money installing building controls.

Shared-tenant services plays a very important role in all of this because of the fact that you are finding companies that are willing to come into a new building and tell the developer that they will put in the new technology and operate it themselves. That is where the buildings that are being marketed as intelligent buildings are, for the most part, under the shared service type of operation.

The next area that I would like to touch on is some of the driving forces that are behind shared-tenant services. The first one is technology, which must be something that you as telecommunications managers are sure is suited specially to your particular firm. It is becoming more necessary and evident that more square footage of office space is being taken up by computers and telephone systems than ever before.

Another driving force behind shared-t enant services is the politics that are involved. Things have changed significantly since the break-up of AT&T. Previous to the break-up, developers would work with a particular general contractor and know the building would be ready for occupancy on a specific date. However, now the developer is stuck dealing with a number of different personnel and it's increasingly difficult to manage the planning and development of a building. The developers are now realizing they need help in coordinating all of the technologies and the various players, which have become plentiful since the AT&T break-up.

The third driving force behind shared-tenant services is one that is important in all aspects of business and that is money. Developers, during the building process, try to attract firms or tenants that will be successful and stay put for awhile. The worst thing that can happen is when a number of vacancies start popping up in a new building. Nationally, the vacancy rate depends on a number of factors, including location, unemployment figures and the general business atmosphere. Some cities have very bad vacancy rates, such as Houston which has a vacancy rate of 30 percent. Dallas isn't as bad with a vacancy rate of 18 percent. Developers must look at these statistics and determine how to keep vacancy rates down and attract tenants. One way he can do this is to install an efficient telephone and management system that will be an integral part in developing an intelligent building.

An important thing that developers must be aware of its that once terminals or communications equipment are put in place it should stay there permanently. The cost of moving equipment after it's installed is usually more costly than the equipment itself. Careful planning is a necessity from the beginning stages of production.

When building, a developer and his staff must determine what the office product availability of a firm will be and that is determined by their needs and size. An average size of an office is not determined by the number of people working there, but by the square footage of an office. The average size of an office is 200 square feet.

With the AT&T divestiture, the need for technical and management expertise is greater than ever. In an intelligent building, the management of the various technologies is just as important, if not more important, than the fancy communications systems.

For a number of years, developers didn't hear of intelligent buildings or shared-tenant services, but there is money to be made if you can land a franchise in a large building. This is how the shared-tenant service offerer makes money. They put in a PBX on speculation and essentially rent telephone equipment to the tenant. If this service is done efficiently, a cost savings of 35 percent can be realized by the tenant.

Enhanced Image Is Sought

The developer is an entrepreneur who after dealing with all of these telephone-type people is going to begin wondering what benefits he is going to reap from the building process. First, the developer wants to develop an image so he will be looking for a certain client to boost his personal image. The desire to be number one is a common desire of developers so if wealthy and influential clients can be attracted to a developers' building, his chances of success rises tremendously.

Since the AT&T divestiture, the office environment has undergone many changes and will continue to into the future. Some needs of tenants are becoming pretty clear and some of the major needs include: timely installation and reconfiguration, rental options, one-stop shopping, low-cost long distance, enhanced small systems, and technical and management expertise.

In constructing intelligent buildings, many more building requirements are essential to keep pace with the exploding technology that is occurring in the telecommunications arena. Some of components that are now found in intelligent buildings are smart switches, local computer networks, broadband network interface, more electrical power, and on-site technical expertise.

In getting back to the benefits of shared-tenant services, a developer must realize there are many more in addition to their enhancement of image. Other benefits a developer can count on are faster lease-up, faster tenant move-in, improved tenant service, building wire management, improved building management system and a new source of revenue. The new source of revenue is a very important point to consider, because as the developer refines the shared-tenant services the intelligent building will be run much more efficiently and cost-effective. This will, in turn, attract better tenants, which will bring us the full circle and back to an enhanced image.
COPYRIGHT 1985 Nelson Publishing
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Copyright 1985 Gale, Cengage Learning. All rights reserved.

Article Details
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Author:Lucas, J.
Publication:Communications News
Article Type:transcript
Date:Jun 1, 1985
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