Short Summary for a Quick Glance:
AI’s advent marks a seismic shift in smart buildings, enabling unprecedented operational insight. This article, informed by James Pellatt’s expertise and insights, explores how generative AI is transforming data analysis, challenging traditional dashboards, and creating a new market divide between predictive platforms and mere reporting. It argues that while foundational industry gaps persist, AI offers a crucial path to truly intelligent, efficient built environments, demanding a shift from a project to a product mindset and a refocused, operations-led approach.
The Full Article
The smart buildings world is currently navigating an unprecedented transformation. In a recent dialogue, James Pellatt — a veteran real estate innovator and consultant with 35 years of real estate experience, including 12-13 years at Great Portland Estates where he became Innovation Director — shared profound insights into this evolving landscape. As the founder of Digital Trees consultancy, he currently advises leading organisations like Bywater Properties, the Crown Estate, Mace, and Stanhope on their digital transformation journeys. He profoundly emphasised that the advent of Generative AI has been an “absolute game changer” for the sector.
For years, the aspiration for “smart buildings” has faced significant hurdles. James Pellatt succinctly captured one of the most persistent issues: the disconnect between project delivery (design and construction) and building operation. This fundamental challenge, in his view, often leads to confusion and suboptimal outcomes as developers make infrastructure decisions during the construction phase, attempting to predict operational lifetime needs.
This foundational challenge, as James points out, is exacerbated by two critical divides within the industry. Firstly, there is a growing chasm between people who are digital native and real estate native professionals. Secondly, a significant gap exists between building owners and operators. James observes that, unlike sectors such as automotive, real estate hasn’t experienced a singular “disruption” that compels rapid, widespread change, making the voluntary adoption of smart building principles more difficult. He stressed that the “briefing stage is critical”, noting that “the art of the brief has been lost”. Yet, it remains essential for defining who will maintain the building and what operational insights are truly needed from its inception. This aligns with a “design to manage” or “design for performance management” philosophy, a concept increasingly championed by large Facilities Management (FM) players, ensuring that what is designed can be effectively operated and provide tangible value.
Then came the “game changer.” James unequivocally stated that the release of ChatGPT in November 2022 was the “absolute game changer” for smart buildings. Generative AI now enables the interrogation of documents and structured data through simple chat interfaces, making the case for smart buildings “so much more compelling”. He highlighted powerful demonstrations of AI’s capabilities: analysing O&M manuals alongside operational data to pinpoint specific issues, like an overheating room, and recommending solutions such as resizing equipment. This moves beyond simple dashboards – which are useful for strategic oversight but less so for frontline operations. James predicts that “in 10 years time we wonder why weren’t doing that anyway”.
These deeply ingrained challenges highlight that despite technological advances, the fundamental issues hindering truly smart and efficient built environments have long persisted, embodying the “plus ça change, plus c’est la même chose” (the more things change, the more they remain the same) phenomenon. However, James’s insights confirm that the advent of AI represents a pivotal moment, poised to profoundly alter the industry’s trajectory. While we did not discuss it specifically, the seismic shift James is talking about will, in my analysis, create a clear divide in the platform market, fundamentally moving beyond the dashboard approach. This division will be between those offering genuine, quantifiable, predictive AI capabilities for optimisation and productivity, and those providing little more than basic analytical reporting. This profound technological inflection point makes the case for intelligent buildings and their continuous optimisation “so much more compelling.”
James also advocates for a “simplified approach” to smart building development. Rather than feature-heavy solutions, the focus should be on creating a foundational “operating system” upon which future features can be iteratively added. In my view, this strategy highlights how the more waterfall methodology of the AEC industries (as embodied by frameworks like the RIBA Plan of Works) could become more aligned with the iterative evolution of technology, arguing for getting the technological foundations right so they can be built upon. As James points out, this contrasts with construction’s traditional “project” approach, aligning instead with the software industry’s “product” mindset.
Building on this, James suggests that a “Silver WiredScore” rating is a sensible entry-level standard, providing the essential energy infrastructure and connectivity needed for future optimisation. This aligns with my own prior commentary on WiredScore’s SmartScore framework, where I argued it offers a compelling starting point for collaboration by inherently linking smart building functionalities to desired outcomes. I proposed then that this positioning could allow SmartScore to be reframed as a core framework for delivering on the ‘Design for Performance Management’ philosophy championed by larger Facilities Management (FM) players, directly addressing critics who say it merely rewards technology for its own sake. James and I clearly share a similar perspective on this potential.
The core principles James outlines – focusing on foundational “operating systems” and iterative development from operational insight – are crucially applicable to retrofit and refurbishment scenarios. Despite common landlord-tenant trust issues that lead to missed opportunities, failing to adopt smart capabilities in existing buildings will, in 5-10 years, mean missing critical operational information.
And, as James observes, just as the Building Safety Act has forced behaviour change in residential design, similar top-down energy performance legislation could drive smart building adoption, similar to how procurement requirements spurred BIM’s growth. Such developments, alongside the undeniable impact of AI and shifts in platform capabilities, will inevitably reshape roles and responsibilities across the built environment, demanding continuous adaptation and new skills from its professionals, while profoundly influencing the tenant and occupier experience and its critical link to employee well-being and productivity in smarter workplaces. This dynamic evolution means that any existing or future smart building frameworks, ratings, or certifications will need to look squarely at “what’s smarter next” to remain relevant and effective, rather than merely defining “what is now.”
It is within this rapidly shifting landscape that my own commentary seeks to provide clarity. My previous commentary on early smart building frameworks, particularly the RIBA Smart Buildings Overlay, garnered significant attention. It highlighted persistent industry disconnects and the critical need for a more operationally-focused approach. As the industry continues its rapid evolution, particularly under the influence of AI, it will be interesting to observe how such foundational frameworks continue to adapt, and not least because of the blurring of lines between digital construction, digital operations and the future of work, e.g. between smart buildings and smarter workplaces.
The insights shared by James Pellatt, particularly concerning the project-to-operations gap and the transformative power of AI, offer crucial perspectives that will undoubtedly shape these ongoing discussions and future iterations of smart building guidance. My role, as a neutral industry commentator with no commercial axe to grind, will continue to be to critically observe and illuminate these developments, ensuring that the dialogue remains focused on tangible, user-centric outcomes that genuinely drive the built environment forward.
Key Takeaways from the Conversation with James Pellatt:
- The Project-Operations Chasm: A fundamental and persistent challenge in the built environment remains the disconnect between design, construction, and building operation.
- The Two Divides: Key gaps exist between digital-native and real estate-native professionals, and between building owners and operators.
- Lost Art of the Brief: Defining operational insights from inception is critical, yet often overlooked.
- AI as the Game Changer: The advent of Generative AI, especially since late 2022, is profoundly transforming how operational data is analysed, enabling actionable intelligence beyond traditional dashboards.
- Simplified, Foundational Operating Systems: Future smart building development should focus on creating foundational “operating systems” upon which features can be iteratively built.
- Product Mindset vs. Project Mindset: The software industry’s “product” approach, with iterative feature additions, offers a valuable model for smart building development, contrasting with construction’s traditional “project” approach.
- Retrofit Potential: James highlights that smart building principles are highly applicable to existing buildings and refurbishment, noting this as a key area for improvement.
- Top-Down Legislation: Similar to BIM, energy performance legislation could significantly accelerate smart building adoption by forcing behavioural change.
- Evolving Roles & Experience: AI’s impact will necessitate a significant reshaping of roles and responsibilities across the industry, demanding continuous adaptation, while profoundly influencing the tenant/occupier and employee experience.
This insightful conversation with James Pellatt has served as a powerful catalyst, sharpening the lens through which I approach market engagement. It confirms that the ‘shifting sands’ I observed in ‘A New Dawn’ are indeed part of a profound ‘that was then, this is now’ moment for the entire digital built environment. My commitment is to help navigate these shifting sands, ensuring my commentary assists readers in understanding and adapting to the evolving landscape of smart buildings and digital transformation. I look forward to further dialogues with other industry pioneers who are at the forefront. I hope you, my readers, will continue to find my commentary valuable as I explore this industry I am passionate about, now filtered through this refocused lens.
