How 5G will transform commercial real estate

How 5G will transform commercial real estate

7 June 2019

During 2019, a once-in-a-decade upgrade to our wireless networks arrives in Australia as network providers—Telstra, Optus, and later Vodaphone—launch their brand-new fifth-generation cellular networks—5G for short.

So, how will 5G affect consumers and businesses?

According to technology website Whistleout, 5G networks will offer three major improvements:

Faster network speeds

5G networks will theoretically be able to reach download speeds as fast as 20Gbps. The exact speeds will depend on how the network has been configured, the number of devices on the network, and the end-use device. The 5G specification states that individual users should see a minimum download speed of 100Mbps. That’s the fastest NBN speed as a minimum!

In Telstra’s Gold Coast 5G trials last year, it achieved network speeds of around 3Gbps. That’s roughly 3,000Mbps, or 30 times as a fast as the maximum speed of an NBN 100 connection.

At these speeds, users could download a typical movie in 15-20 seconds, compared with 6-10 minutes for 4G.

Lower latency

Simply put, latency is the time it takes information to get from your phone to the wider internet and back again. The typical latency for a 4G network is around 60 milliseconds, whereas 5G could decrease this to as low as 1 millisecond. This massive decrease in latency will be vital for technology such as self-driving cars, where every millisecond could make a difference in preventing a crash.

More simultaneous connections

5G will allow more devices to connect to the network at the same time. While smartphone usage continues to grow, this is especially important because 5G is set to facilitate new developments in autonomous cars, connected machinery, and Internet of Things (IoT) devices.

Thus, 5G is poised to be a very big deal, a far bigger transformation in mobile technology than any previous generational shift, says the Harvard Business Review. Its speed, capacity, and dramatically reduced power consumption and communications response times, or “latency,” will make possible an astonishing range of innovative new products and services.

The economic and social benefits could be enormous and will potentially transform commercial real estate.

5G connectivity will enable building owners to monitor any piece of equipment virtually and in real-time to drive more efficient outcomes such as enhanced tenant experience and workplace productivity, says In-Building Tech.

Its higher speed and bandwidth will create fully wireless workplaces and impact everything from printers to elevators. Greater bandwidth would also allow artificial intelligence programs to analyse more data in real-time, allowing smart buildings to engage and interact with employees and landlords.

It will also enable more efficient building maintenance in both commercial and industrial buildings, allowing technicians to address issues virtually and reducing downtime, equipment failure, and costly on-site visits.

Additionally, cloud-based building management systems (BMS) could become complete virtual and simplify building administration for companies with a portfolio of buildings. System administrative teams could be streamlined into a single hub for managing workplaces across various cities or countries.

All this, of course, will have major implications for building owners and developers.

5G networks will require many more base stations—each of which is physically smaller than a current cellular tower. They will also need to be placed much more closely together. 5G base stations could be placed every 250 meters, rather than the every 1 to 5 km needed for 4G.

Each base station will require its own electricity and fibre-optic service, whether it is a specialized structure or installed atop a building, power pole, or street light.

Network providers will be looking to building owners to install the 5G infrastructure needed to service their tenants and the surrounding areas.

In a commercial real estate scenario, the need to propagate signals will be challenged by a myriad of factors including the age of the building, the materials used in construction, the needs of a potentially diverse tenant base, and physical location just to name a few.

But while building owners will potentially have to spend more out of their own pockets to ensure 5G connectivity, it will also buy them increasing influence with the network operators in terms of what gets deployed in their building, and how it is done.

In short, to benefit from the 5G revolution, commercial real estate professionals must embrace the requirements for a full-fledged 5G network in their buildings.

They should not shy away from investments in a right-sized mix of whatever technologies will be required to make it happen.