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The continued interest in smart homes shows no signs of losing momentum even as the pandemic recedes. Renters and buyers alike have embraced the opportunity to live in connected environments that support the remote working lifestyle. This is just the beginning. Next in line for an upgrade to smart home technologies is the entire building. Find out how property developers and managers are unlocking the return on investment of smart apartment buildings and exploring ways to bring cutting-edge technology to the multidwelling unit (MDU). 

What Are Smart Buildings?

Smart multifamily buildings occupy the middle ground between the single-family home and the commercial building. They combine the networking and building management features of the latter with the lifestyle amenities of the former. A building can be considered “smart” when it deploys a distributed control and information system that allows devices and sensors to communicate, both internally within the building and externally with the management company. As the name suggests, the smart apartment building is a real-time, responsive and intelligent entity that adapts to occupants’ needs and behaviors. That means offering greater connectivity and enhanced amenities to any building that contains five or more units, whether it is student housing, corporate housing, an office building or rental apartments.  

What’s Behind the Rise in Smart Apartment Buildings?

The smart building sector will be worth $108 billion by 2025 and is increasingly serving the over 6 million MDU units across the U.S. and Canada housing more than 40 million people. The momentum is driven by sound economic sense on one hand and the growing integration of technology into our daily lives on the other. Tenants are looking for housing solutions that support the hyper-connected lifestyle, while property owners want to optimize resources and meet the demand for energy-efficient housing. Whereas the traditional building management system (BMS) put the structure in place for control, “Internet of Things”-enabled smart buildings go further, unlocking the value of data analytics and real-time intelligence to help drive operational efficiency and user experience. 

What MDU Developers Are Doing Already

The appetite for multidwelling units is already healthy. Construction of MDUs hit record levels in 2020, with over half a million starts, and the sector has been rising steadily since the 2009 crash. But construction does not automatically correspond to occupancy, and today’s tenant or buyer has more sophisticated needs that balance service provision and privacy. Delivering home automation features increases rental value for building managers, who have quickly responded to the networking and security challenges of remote working by adapting properties for fast internet connectivity and keyless access. To meet the rising demand for energy-saving features, they are also now more likely to offer features such as smart thermostats (and corresponding HVAC analytics), smart glass or solar panels as standard. These innovations are just the beginning, however. 

How MDU Developers Can Embrace Smart Tech

The creation of smart buildings could well be the final stepping stone toward the much-heralded smart cities of the future. At the heart of this shift is the Internet of Things (IoT), allowing devices to communicate, optimize settings, grant or deny access and create alerts if security or performance issues arise. In an MDU environment, that means developers should be targeting the following: 

  • The surge in remote working during the pandemic exposed the weakness of copper and wireless-only networks. Developers should install high-speed internet cabling through a central hub. The good news is that MDUs offer a lower per-apartment deployment cost than single-family units, condos or MFUs.  
  • Optimized energy consumption using sensors to detect which areas are occupied, adjusting lighting, heating and air conditioning accordingly.  
  • Enhanced security that establishes automated conditions for keyless entry and access, with video surveillance in communal areas as an option. 
  • Seamless integration with users’ personal devices for creating an optimized environment. The ultimate goal is to design buildings that adapt to the occupant, such as a meeting room that is already configured to a user’s pre-saved preferences. 

The Need To Stay Competitive

Factoring in personalization and customer-centric features into smart buildings allows MDU developers to target and retain customers who are willing to pay a premium for the experience. That said, developers need to stay one step ahead of demand, given the speed with which technology evolves. Despite the upfront capital expenditure, there are benefits to the bottom line to be seized. Smart apartments can deliver rent premiums of up to 10%, for example, while self-guided tours enhanced by automation of vacant properties can increase conversion rates by over 30%. For the building manager, smart buildings also promise lower operational costs in the long term, as well as higher occupancy and lower turnover rates, simply because the customer experience is unbeatable. 

Find out more about our innovative smart home technology solutions for MDUs here


Broadband Communities Magazine – A Boon for Network Deployers: Record MDU Construction

JLL – High-Tech and Human-Centered: The Rise of Smart Buildings

Watt Sense – 5 Trends Taking Over the Smart Building Sector in 2020

Markets and Markets – Smart Buildings Market Worth $108.9 billion by 2025

Space IQ – Top 5 Smart Building Challenges, Concerns and Planning

NMHC – The Rise of Smart Apartments

CABA – Connected Multi-Dwelling Units and the Internet of Things