Technological innovation and resilient real estate

SMART CITIES

A smart city is a place where traditional networks and services are made more efficient with the use of digital

solutions for the benefit of its inhabitants and business. It also means a more interactive and responsive city

administration, safer public spaces and meeting the needs of an ageing population.

(European Commission, 2025)

Caragliu and Del Bo (2022) characterize smart cities as “the unique meeting place of ICTs, on the one hand, and

human and social capital, bottom-up governance, and quality of life andsustainability, on the other”.

As this definition implies, the incorporation of information and communication technologies in urban areas is

intrinsically linked to the socioeconomic and institutional context.

smart city initiatives (SCIs) are being implemented in cities of varying sizes, each characterized by differences in

the level of technological development, economic wealth, levels of human and social capital, institutional

arrangements, and the challenges they confront. Consequently, it is reasonable to expect that their problems and

potential solutions will vary significantly, so one- size-fits-all approaches will be ineffective.

Areas in which this concept is applied:

REAL ESTATE CONTEXT

designer is faced with a much more complex task than in the past, which requires in-depth technical knowledge.

This is due to:

• The increase in the complexity of the built environment;

• Changes in production: more industrial, innovative, and efficient construction systems

Manufacturing vs real estate

• no relationship with the context • life cycle limited in time

• The plant is owned by the manifacturer • Stable organisation

• Business develops globally

• Value decreases overtime

What investors need:

Market analysis: demand and supply trends, Investment planning and control

property investment and yields Management of property development operations:

Investment strategies planning and analysis of

Analysis and management of property cost, contractual and control activities

investment risks Portfolio (buildings or plots) strategies

What owners need

Property Management services; Dedicated information systems (data analysis);

Property valorisation processes; Valuation of properties/building assets.

What End-users need

GUARANTEE

Comfort

Layout fitting user’s requirements

Space able to support their core business

Services to people, business, organization, buildings

THE 2030 AGENDA FOR SUSTAINABLE DEVELOPMENT

The 2030 Agenda for Sustainable Development is a program of action for people, planet and prosperity signed in

September 2015 by the governments of the 193 member countries of the UN,

meeting in New York. It incorporates 17 Sustainable Development Goals, SDGs, into a major action programme.

The official launch of the Sustainable Development Goals coincided with the beginning of 2016, guiding the world on

the path to follow over the next 15 years: countries, in fact, have committed to achieving them by 2030.

Sustainability

RELATIONSHIP BETWEEN HUMANKIND AND NATURE

First studies begun in the ‘50s. There is a strong relationship between nature and humans since the very beginning.

In the ‘70s the Limits to Growth report was commissioned to MIT and it predicts the consequences of continued

population growth on the earth’s ecosystem and on the very survival of the human species. For the first time, planet

earth is defined as a finite and limited system. For people, what happens far in space is not relevant. In the ‘80s The

Brundtland report was commissioned by the World Commission on Environment and Development and it explicitly

defines the concept of sustainability as: THE ABILITY OF A SYSTEM/PROCESS TO MAINTAIN ITS CONDITIONS FOR

AN UNLIMITED PERIOD OF TIME.

Sustainable development is defined as development that meets the needs of the present without compromising the

ability of future generations to meet their own needs. To achieve sustainable development, it is important to

harmonize three fundamental elements:

• economic growth,

• social inclusion, and

• environmental protection.

Social challenges: Ensure the development of society and the well-being of people placing as "limit" the capacity of

the environment to support this development.

Environmental challenge: It is the responsibility to conserve natural resources and protect global ecosystems to

support health and well-being of people while guarantying the continuity of the natural environment.

Economic challange: It is the combination of practices to support long-term economic growth without negatively

impacting social, environmental and culture aspects of the community.

SUSTAINABLE POLICIES

SDGs (or Global Goals) were adopted by the United Nations in 2015 as a UNIVERSAL CALL TO ACTION to:

• End poverty;

• Protect the planet;

• Ensure that by 2030 alla peoplce enjoy peace and prosperity

The 17 SDGs are INTEGRATED: actions in one area affect outcomes in others. Countries have committed to

prioritize progress for those who are further behind. Creativity, knowledge, technology and financial resources from

all of society is necessary to achieve the 17 goals in all contexts.

Sustainable development in the built environment

The academia and the market are wondering how to make buildings more “sustainable” in order to compy with

international regulations.

In particular, Goal 11 states about making cities and human settlements inclusive, safe, durable and sustainable.

N.B. 40% of energy is consumed by built environment. The European Union aims to make Europe the first

climate-neutral continent by 2050. The members have some years to adapt these regulations on a national level.

As for the life cycle of a building, the regulations are EN 15978:2011 and ISO 14040:2006

PERFORMANCE IN BUILDING ENVIRONMENT:

CAN YOU MENTION SOME TYPE OF PERFORMANCE?

• ASSESS PERFORMANCE: performance is defined as the degree to which stated objectives are being achieved.

for ex. In an office building’s performance you have to understand how physical spaces impact workers and business.

• PERFORMANCE MEASUREMENT: a process of assessing the progress towards achieving predetermined

goals. Its aim is to OPTIMIZE costs and sustainability.

• EVALUATION: periodic and objective assessments

• PERFORMANCE MANAGEMENT: the use of performance measurement information to effect positive change

in organizational cultures, systems, and process.

• Monitoring: continuous process of tracking with the result of supporting day to day management and

decisions.

New measures of sustainability performance have been adopted in EU.

LEVEL(S): Language system common to the entire continent to unify the measurement of the sustainability

performance of a building throughout its life cycle.

1. Level 1: qualitative: conceptual design for the building project

2. Level 2: quantitative: detailed design and construction of the building

3. Level 3: monitoring: as built and in use performance of the building after completion

Popular indicators are ESG indicators: ENVIRONMENTAL, SOCIAL, GOVERNANCE

Socially responsible investments are of strong interest in the real estate market;

- ESG indicators are used to define the level of sustainability of operations, stressing environmental and social

costs and benefits;

- The most recognized ESG frameworks, such as those of the Global Reporting Initiative (GRI) and the Sustainable

Accounting Standard Board (SASB), do not define specific parameters for real estate developments and the

properties themselves;

- Existing frameworks mainly stress the "Environment" component, avoiding to define indicators for the other two;

- ESG have the potential to translate the United Nations SDG targets into indicators for sustainable real estate

investments;

- In the Real Estate sector there is now a new opportunity to lead the way in the field of ESG sustainability

standards.

EU has defined a clear sustainability strategy based on the issuance of binding regulations for both companies and

financial operators.

A regulatory process is underway to develop an integrated system of ESG standards, mandatory for an increasing

number of stakeholders, and aimed at regulating the methods for measuring and reporting ESG performance.

Currently, sustainability can be either a "compliance choice" in itself or a "strategic choice" for long-term value

generation that impacts the mission, governance, organization, and products. This requires:

• A comprehensive view of regulatory interconnection (e.g., Taxonomy Regulation).

• A forward-looking approach to evolving regulations (e.g., Social Taxonomy).

Sustainability: IV level of obsolescence

Obsolescence in buildings refers to the process by which a building becomes less desirable or functional due to

factors such

as changes in technology, regulations, market demand, or physical condition.

Obsolescence can be classified into different levels based on the underlying causes and the degree to which a

building is affected. These levels typically include functional obsolescence (when a building’s design, features or

layout no longer meet the current needs or expectations of users), economic obsolescence (caused by external

factors that affect the value of a building, such as changes in the local economy, regulations or market trends), and

physical obsolescence (refers to the physical deterioration of building over time, making it less functional or

aesthetically appealing).

THE VALUE OF SUSTAINABILITY IN BUILDINGS:

A sustainable building does not necessarily have a higher economic value compared to a non-sustainable building,

but it gains additional value tied specifically to the concept of sustainability.

Effect of sustainability principles:

A building may be technologically INTACT, capable of meeting the users' demands (e.g., meeting minimum

requirements to carry out necessary activities), but it may not be sustainable. This represents a new level of economic

obsolescence for buildings, making sustainability an essential attribute.

The digital technologies of the sector:

The purposes for which the sector adopt digital technologies are the following:

REAL TIME BUILDING VISUALISATION AND MONITORING

COLLECTION- ANALYSIS-MANAGEMENT OF LARGE AMOUNT OF DATA

CUSTOMER UNDERSTANDING AND INTERACTIVE INTERFACE

The EPBD – Energy Performance of Buildings Directive: (New laws to be complied with the corpus of EU directives)

• EPBD I (EU 91/2002) was transposed into Italian law through Legislative Decree 192/2005, which defined the energy

performance levels of buildings and the guidelines for energy certification.

• EPBD II (EU 31/2010) was implemented with Law 90/2013, which established minimum requirements and guidelines

for the “APE” (Energy Performance Certificate).

• EPBD III (EU 844/2018) led to the publication of Legislative Decree 48/2020 in the Italian context, which set out new

minimum requirements.

• EPBD IV calls for the submission of a national building renovation plan by 31 December 2025.

PROPTECH

PropTech, Property + Technology, involves start-ups and scale-ups, as well as real estate companies and other

established firms that develop innovative, data-driven services and solutions across various scales of the built

environment. It leverages advanced digital technologies that operate within different segments of the real estate and

construction value chain.

3 WAYS OF INNOVATION

Innovazione tecnologica del settore in 3 ondate:

• PropTech 1.0 It has introduced the 'digitization'of data and computing power (such as AutoCADsoftware)

• PropTech 2.0 it has focused on bridging the gap between supply and demand in the real estate market,

implementing e-commerce and social network solutions;

• PropTech 3.0 it is currently working on the integration of exogenous technologies, including the Internet of Things

(IoT), Artificial Intelligence (AI), Machine Learning (ML), and Blockchain, to develop scenarios and forecasts

Vedi esempi proptech slide 120

OBSOLESCENCE

The types of obsolescence in real estate are economical, functional, physical.

Economic obsolescence is often caused by external factors beyond the control of the property owner. Technological

advancements c