How did your collaboration come about?
Grigor Hadjiev. Data is at the heart of our investment and asset management strategy. The buildings that make up our real estate portfolio are beginning to generate a lot of data and their exploitation is crucial. We therefore approached Square Sense to collect and structure this data.
Antoine Ziliani. I think we were in the right place, at the right time and with the right solution. Optimizing the financial and environmental performance of a real estate portfolio, through the exploitation of the data of its buildings constitutes the central element of our solution.
Could you describe the integration of Square Sense technology into Allianz Real Estate’s real estate portfolio?
G. Hadjiev. In 2019, we launched an ambitious building digitization program with three main objectives: improving environmental performance, creating a service offer for tenants and supporting their return to the office, and streamlining our operation. These points require an understanding and structuring of the data so that the asset manager can interpret them. Allianz Real Estate can then make decisions.
How does this integration manifest itself?
A. Ziliani. There are two levels of integration: one is mainly technical and consists of connecting the different data sources available in the building. It is then a question of giving meaning to this data and this is our role as data scientist. The second level lies in the processes, the fact of committing asset managers to exploiting the data. There are real managerial challenges in supporting these professions and the development of their practice. Anticipate, accelerate and make decision-making more reliable, with an objective of financial and environmental impact. Thanks to its solution, Square Sense represents an objective third party on the evaluation of the various elements that can affect asset management.
Can we deploy this technology upstream of an acquisition?
G. Hadjiev. Any building, whether built or not, generates data which can then be processed by Square Sense. It seems interesting to us to analyze potential acquisitions from this angle. On the other hand, it is still a little early and the market is not mature enough to allow us to have these elements upstream.
A. Ziliani. On the existing heritage, Allianz Real Estate is preparing to enrich its assets with historical data and their interpretation. When legally possible, the transmission of this data to potential buyers brings additional value to the asset.
“We are convinced that the data generated by a building constitutes an asset in itself”
Do you think that this transmission will spread or even become compulsory?
G. Hadjiev. Soon, some buildings will have to be equipped with an equivalent of the GTB centralizing the operating data of the buildings. The Operat platform aims to consolidate the energy data of buildings. We are convinced that the data generated by a building constitutes an asset in itself and that the exploitation of this asset will be the standard of tomorrow, knowing that the data recovered all meet the requirements of the General Data Protection Regulation both in terms of protection of this data and on our responsibility in their processing.
How does the integration of this technology materialize in the portfolio of Allianz Real Estate?
G. Hadjiev. Our ambition lies in the implementation of a partnership system allowing to have reliable equipment in the buildings and exploitable by the local partners whether they are in the United States or in Asia with as a highlight the insurance that each building has the best technology. For example, the building occupancy data speaks for itself: entries into a building make it possible to observe the return to the office and its conditions. What we see is that employees return unequally from one country to another, but above all that they often return on the same days. This type of behavior is unexpected and requires measuring its extent.
What kind of decision results from this type of analysis?
G. Hadjiev. Until now everything led to believe that the home office would kill the office. However, these group behaviors attest to the contrary and prevent a considerable reduction in surface areas. This trend leads us to consider more flexible and attractive offices for users, for an equivalent number of square meters. The data contributes to a better understanding of new uses and to the anticipation of user needs.
A. Ziliani. We have not yet identified all the possible uses of data and this is the interest of this profession and the salt of this adventure. Access to this phenomenal source of information is an extraordinary source of value. Exploiting this deposit represents a huge differentiating factor for Square Sense and supporting Allianz Real Estate in this system is a fantastic opportunity.
“We have not yet identified all the possible uses of data and that is the interest of this profession and the salt of this adventure”
What characterizes your partnership?
G. Hadjiev. It seems very important to us to be certain that our partners have a very strong local presence. The interpretation of the same data does not result in the same action in each country, hence the need for a local partner to centralize and coordinate the data at the asset level and then to be able to draw conclusions at the heritage level. I take this opportunity to point out that the ownership of the data is essential to us. Square Sense operates as a data analyst of our buildings’ data on behalf of Allianz Real Estate. They are part of the team while being external to it through extensive sharing of their methods and operating methods. We wanted to be our own data scientist but the rapid evolution of trends pushed us to favor a partnership to start with.
A. Ziliani. We establish ourselves as an operating partner of Allianz Real Estate. Trust is paramount in this partnership and data ownership is one of the keys to this trust. We have never claimed to exploit the data in our corner, transparency in processing is a prerequisite for our customers.
Interview by Alban Castres