owners and managers look afresh at the underlying operational cost base of their assets. The added value offered by smart buildings has already been widely acknowledged amongst expert commentators. According to the European Commission report on Macroeconomic and Other Benefits of Energy Efficiency, a smart, higher- performing building can conservatively add as much as 11.8 per cent in lease value and can ultimately yield five per cent to 35 per cent higher sale values. Manufacturing sectors have all been affected, even

in areas like food and beverage, pharmaceuticals or medical products, where demand has not fallen but has nevertheless been disrupted. Manufacturers large and small will still have to seek enhanced operating agility, flexibility and efficiency, as well as reducing energy costs, to cope with the “new normal”, qualities that expert commentators say are enabled through automation, digitalisation and a variety of other technology and machinery investments, whether replacement or retrofit. While there is wide consensus around the need to

make buildings smart, all countries and sectors need a way of making that conversion financially sustainable. How can this be done? The starting point is to use smart technology to reduce

energy consumption in buildings. This produces hard financial savings that – through smart financing arrangements – can be harnessed to subsidise or even pay for overall smart buildings conversion. This can be done at an enterprise level, or in small incremental steps, each of which proves its return on investment. For whole building and multi-building projects, budget-neutral schemes are available from specialist financiers to enable conversion. They are increasingly becoming known as "Building Efficiency as a Service" (BEaaS) arrangements. The integrated solutions provider introduces technology and systems to create smart buildings which deliver a clearly predictable level of energy savings. The reduction in energy costs is then harnessed to effectively fund the cost of conversion. Throughout, the building’s owner has conserved their

own funds for strategically important development activities – whether commercial growth or improved public services. In the post-pandemic period, where cash reserves have been used up and revenues are experiencing a downturn, the idea of self-financing smart building conversion becomes even more compelling than before the crisis. The latest insight paper from Siemens Financial

...delivering value in the “new normal”

Services (SFS) establishes the urgency and value of smart buildings conversion, as well as the mandatory drivers that are focusing attention on converting existing buildings to greater energy efficiency. At a time when building owners and managers are

having to invest in measures to make their buildings safe and occupiable, and are also being restricted on the density of occupation, it is arguable that, only smart buildings will present a sufficiently attractive proposition to potential tenants and occupants. In a budget constrained environment, energy efficiency savings are increasingly seen as the ideal starting point for smart buildings transformation (either as a single investment or as a series of incremental projects), with smart financing techniques playing a major role in enabling those future savings to finance the cost of conversion.

Siemens Financial Services


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