property managers

Changing market challenges property managers

Cybersecurity risk not grasped on a day-to-day basis despite smarter buildings
Tuesday, December 13, 2016
By Rebecca Melnyk

Changing market conditions, from cybersecurity threats and urbanization to more mixed-use space and technology disruption, are all impacting the way buildings are managed. Leading property managers were recently on hand at a PM Expo seminar in Toronto to elaborate on these trends and discuss the skills newer managers will need to bring to an increasingly technical field.

Cybersecurity

A talk on smart and connected buildings took a sharp turn into discussing cybersecurity risks. Managers are now, more and more, having to consider cybersecurity threats as industry produces more connected buildings. However, there hasn’t been as much thought into understanding potential risks. As David Hoffman, general manager of The Cadillac Fairview Corporation, said there are many things managers can do to harden up their infrastructure, but cybersecurity threats are not yet understood or even appreciated.

Building systems are constantly under attack. CCTV camera systems, IP addresses, automation and mechanical systems, and even parking meters, all have hacking potential. Unfortunately, most consultants don’t always emphasis cybersecurity protection during a first meeting.

“We as an industry are not there yet in terms of securing a building,” said Maud Chaudhary, senior vice-president of portfolio management, national services, Dream Office REIT. “This is an area, as an industry, that we are slow to respond to. To be candid, most of us do not really understand the risk on a day-to-day basis.”

Regarding liability, Michelle Brown, vice-president of property management at Bentall Kennedy (Canada), suggested managers think more about how contracts are written to protect management, as well as customers.

Oxford Properties has recently launched a cybersecurity standard based on a framework called NIST, which was created through collaboration between industry and government and consists of standards, guidelines, and practices to promote the protection of critical infrastructure.

“We’re beginning a transition with all of our systems and buildings onto those kinds of frameworks so that, at the very least, we’re locking the front door,” said moderator Lachlan MacQuarrie, vice-president of national programs at Oxford Property Group. “The reality is there are many, many doors that are completely unlocked today. It’s not something we can solve quickly, but we start having more conversation about it.”

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Emergency response

Training and ongoing dialogue are two traits of effective risk management programs. Among its many security features, Cadillac Fairview has a risk check program that demands 100 per cent compliance with all its properties, and reports results to the board. They have also hired more national staff with experience in occupational health and safety and risk management, and have placed greater emphasis on compliance training.

“When it comes to issues like risk, a lot of the buildings have outsourced security, but we have purposely kept it in house, and read and sign-off on all emergency response plans,” said Hoffman. “Training is key; that is a way we distinguish ourselves from the other buildings. Our team responds extremely well during emergencies.”

Bentall Kennedy has implemented a program, which Brown said follows a strict path for dealing with emergency responses, such as security, floods and weather events. Along the way, management engaged with tenants and role-played scenarios to work out any kinks. Management started a conversation with tenants ahead of time in order to redefine their expectations.

“The minute you start having that dialog with tenants, they realize that they have a hole in their system,” said Brown. “All of a sudden they want to lean on you as a property manager, to fill that gap. There is a piece to play in that, and we can certainly collaborative on an emergency response plan, but tenants tend to think the property manager will deal with an emergency. We will be a part of it, but we’re not the plan.”

Technical responses to improving sustainability

Earlier on, MacQuarrie had set the platform to discuss various technical strategies used to improve energy and sustainability in buildings.

Understanding why a smart building strategy is important to a portfolio is something all managers must first consider, according to Chaudhary.

“There’s a lot of talk and noise about smart and connected buildings,” he said. “The fundamental question everyone needs to address is, what are smart and connected strategies for a portfolio and individual assets? There is no single answer or approach; it really depends on what your organization is trying to do over the long term.”

He said smart and connected is somewhat challenging from the point of view of a portfolio of quality B and C existing assets. Replacing building systems without a payback is not easy. But for the last two years, Dream has incorporated about $70-million of capital into Scotia Plaza in downtown Toronto, a Class-A asset.

“It was a tough decision; it’s a lot of money, an existing asset,” said Chaudhary. “The focus we’ve made is improving building efficiency and changing building systems that will have a better return and a payback in the end.”

Eco tracker, a program exclusive to Bentall Kennedy, allows the company to quickly see how much electricity, water, waste, and gas are being used down to the hour. It considers occupant numbers and floor loads into those metrics and can be configured to automatically upload daily energy data.

Brown said if the company has initiated a project, such as a lighting retrofit, daytime cleaning or a change in the recycling program, the technology allows them to measure, on a floor-by-floor basis, how successful that program is.

“The next step is making sure the integration of all this data we receive comes together nicely and we get some really interesting metrics out of it,” she noted. “It’s great for us to monitor and read and understand the metrics in real time from an energy perspective, but how does that tie into our preventative maintenance program?”

Efficiencies gained from a preventative maintenance program can possibly tie into energy efficiency and into building population and elevator data.

“For us, the next step, is looking at how we tie in all these data points to come up with some really predictive measurements and ways we can look to enhance service.”

For Hoffman, “tackling smart buildings in energy savings and efficiencies, and also in operational efficiencies.” This includes upgrading CMMS from a Legacy System to a new platform from IBM Maximo. Also, maintenance repairs and capital planning extend asset life and reduce infrastructure costs and downtimes. Automation software from ICONICS, not only examines energy data in real time, but looks at issues regarding equipment downtime and performance, such as fault detection. The team has also implemented a distributed antenna solution (DAS) that provides (Long Term Evolution) LTE, cellular, wireless and data enhancements for all its building occupants. Cadillac Fairview is also making major changes in its call centre technology, looking at how calls are managed and tenants serviced.

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Next generation property managers

For Hoffman, hard skills include understanding smart buildings and knowing trends like destination dispatch, LTE and building automation systems. Social media and public relations, cybersecurity knowledge and business case planning are also important, along with people skills.

“We want to hire leaders, and things like ethics, communications, problem solving, decision-making critical thinking and interpersonal skills—those are equally as important as the hard skills,” he said,

For Chaudhary, it comes down to having the right attitude, and someone who wants to be on the frontline with customers and communicating everyday maintenance issues, such as broken elevators or finding ways to simplify complex and technical industry-based knowledge and communicating that to tenants.

“You could argue that you’re the mayor of a small town,” noted Chaudhary, adding, “Sometimes you’ve got teams of 25 to 30 people. It’s the soft skills, in my opinion, which outweigh many of the hard skills. The hard skills are learned; you can train people. If you don’t have the soft skills, unfortunately, property management may not be the right field for you.”

Brown fell into the field as a “generalist,” interested and aware of the many different factors within a portfolio, and aware of who to contact to find more specification on an area.

“We’re the nucleus of the industry; we connect to asset management, we connect to the tenants, we connect to, [for us], our sustainability group. We are the piece that holds it all together.”

She said the “right person” for this career path is someone who can converse with the cleaning staff and the president of a multinational organization; someone who can talk to a mom and pop shop struggling to make ends meet in order to understand their perspective and help them “get over the finish line,” and someone who can deal with everyday tasks from staffing issues to the financial analysis of a property.

And yet another task of growing importance is finding ways to assist partners, such as building operators and contractors. These roles that are becoming harder to fill due to skills shortages and evolving needs.

“The cleaning industry is the same,” added Chaudhary. “That kind of workforce that was prevalent in the 80s and 90s does not exist, or is becoming smaller and smaller every day. People want stability, a nine-to-five job.”

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