Mixed-use Innovation Districts: The Future of Sustainable Development
Cities, real estate developers, utilities and technology companies are beginning to come together strategically to collectively define their smart community goals, shared business models and high-impact projects to create innovative, integrated and transformational communities. These 'Mixed-use Innovation Districts' (MIDs) range from smaller than one acre to over 100 acres in size, and typically serve as catalysts for sustained regional innovation and growth.
MIDs generally include a rich mosaic of live-work-play facilities anchored by high-density residential housing. MIDs are walkable communities thoughtfully infused with human-centric technology to drive economic development, improve sustainability, increase resiliency and enhance overall quality of life. What makes the development of modern MIDs different from past approaches can be seen with the stakeholder engagement at Peña Station NEXT, a public-private partnership between the City & County of Denver, Denver International Airport, Xcel Energy, RTD (Regional Transportation District - Denver), developer L.C. Fulenwider and Panasonic.
The key to successful MIDs isn’t technology at all - it’s the strategic alignment of key stakeholders from the beginning. Perhaps obvious and seemingly easy, it is notoriously difficult at city scale. Once key stakeholder executives are aligned, public-private business models can be defined that unlock project financing, which is where most developments fail. With financing secured, high-impact projects can be implemented that help all stakeholders achieve their goals and result in innovative and deeply integrated communities.
Peña Station NEXT is a 382-acre transit oriented mixed use development. The first phase is powered by a solar+storage microgrid, which includes a 1.6MW solar canopy, 1MW/2MWh battery storage, and 259kW of backup rooftop solar for sustained off-grid operation. The development serves as a living innovation lab for all stakeholders to evaluate emerging technologies and vendors, and to create business cases for broad solution deployment based on real world experience.
The community is currently net power positive, generating about 6MWh of clean solar power daily. In the spirit of continuous innovation, Panasonic is working with Xcel Energy and the National Renewable Energy Lab to create a Carbon Neutral Energy District plan that will merge distribution network and building energy planning with integrated stakeholder business models. This will enable utilities and developers to deploy low/no carbon energy infrastructure optimized at the system level, compared to traditional development whereby each stakeholder makes sub-optimized system investments due to typically arms-length business relationships and models.
Having the utility leverage their balance sheet to implement distributed energy resources, such as solar, storage, fuel cells, and combined heat and power, provides a sustainable business model for the utility and minimizes developers' initial energy infrastructure build cost for each building. The no/low carbon footprint from MIDs is especially valuable to city leaders because they provide a rare ability to 'move the needle' in their quest to achieve the deep carbon reduction goals of the Paris Accord by 2030.
In addition to no/low carbon energy, MIDs can also optimize other services via intelligent street lights. Cities and utilities generally own the street lights in real estate developments. However, developers are increasingly playing a role in the introduction and deployment of smart technology into street lights. Most developers have to install and pay for street lights and other city infrastructure as they build out their developments. Business-as-usual developers might view this as a necessary evil to be cost-minimized. MID developers, however, when aligned with the city and utility stakeholders, increasingly see the benefit of investing in district-scale smart city technology and infrastructure that adds unique value to the community and paves the way for citywide deployment of solutions such as smart street lighting.
The manageable scale of MIDs, when combined with aligned stakeholders and innovative business models, enables city stakeholders to innovate relatively quickly with less financial and technical risk. Implementing smart street lighting in a MID, for example, frequently serves as a starting point for many smart city initiatives due to the opportunity to save 50% or more of energy costs. This is compelling, since street lighting can consume up to 40% of a city's energy budget. The cost and complexity of upgrading tens of thousands of street lights can be daunting, and city leaders are well served by having a real-world environment, such as Peña Station NEXT, to test innovative technologies and validate business models before rolling them out on a larger scale.
Many smart city technologies, including smart parking, community Wi-Fi, environmental sensing, and public safety, will leverage the ubiquitous, always-on nature of street lights. Developers can help city leaders sort through this confusing and vast array of smart city options by deploying a thoughtfully integrated mix of smart city applications that enhances MID resident and visitor quality of life, provides compelling economic returns to investors, and creates a technology-rich environment for innovation across all stakeholders.
MIDs can also serve as ideal locations for the relatively rapid deployment and testing of autonomous cars and connected vehicle technology. While many states are moving to pass legislation supportive of autonomous transportation, the reality is that very few cities are prepared for the large-scale introduction of autonomous vehicles. Having dedicated lanes for autonomous vehicles and testing a wide range of smart mobility technologies makes the MID more sustainable and more compelling, and can provide city leaders with the experience and confidence needed to make important decisions about the broad deployment of autonomous vehicles.
For the developers, MIDs offer a wide range of benefits. Peña Station NEXT provides several examples, such as more reliable power, improved connectivity, safer streets, and a healthier environment. The utility's back-up battery in this MID has allowed for the reduction of diesel emergency generation capacity, reducing costs for vertical developers and improving local air quality. An autonomous shuttle recently arrived at Peña Station NEXT, and it will soon provide better 'first and last mile' connectivity between buildings, the train station, and bus stops associated with this MID. Sensors in the Peña Station NEXT street lights are being utilized to optimize city services, monitor air quality, and improve safety. All of these features make the community even more desirable to residents.
Through implementation of autonomous vehicles, smart street lights, a utility micro-grid with clean and reliable energy, and other human-centric planning and technology, the living lab at Peña Station NEXT is proving the business case for MIDs. This has only been made possible via alignment of the city, county, developers, and utilities. They are working together to create deeper partnerships, new business models and improved integration to make such an innovative and transformational community possible. Due to the success of Peña Station NEXT and other MIDs, we expect many more of these communities to emerge in the near future.
This article is co-authored with George Karayannis, VP, CityNOW, Panasonic who has over 25 years of emerging technology and sustainable solutions sales, business development, and marketing leadership at Fortune 100 firms and high-tech startups. He currently leads Panasonic’s CityNOW team in North America.
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UPCOMING REALCOMM WEBINARS
Commercial and Corporate Real Estate Cyber Risk - Developing a Comprehensive Strategy - 10/25/2018
Hardly a day goes by that we don’t hear about a Cyber breach. The most recent of scale was Equifax, the credit reporting agency in which credit information of 143 million of its clients was breached. While most of the incidents we hear about involve data or financial theft, there is a looming threat…our built infrastructure. This infrastructure includes everything from power plants to dams, but also includes the millions of buildings we use every day to work, shop, learn, recreate, manage our health and more. The threats range from unwanted building access to pirating of video surveillance and everything in between. This webinar will focus on the entire spectrum of Commercial and Corporate Real Estate cyber challenges, solutions and strategies.
Founder of Realcomm Conference Group, an education organization that produces Realcomm, IBcon and CoRE Tech, the world's leading conferences on technology, automated business solutions, intelligent buildings and energy efficiency for the commercial and corporate real estate industry. As CEO, Jim interacts with some of the largest companies globally pertaining to some of the most advanced and progressive next generation real estate projects under development.
Tom Shircliff is a co-founder and principal of Intelligent Buildings, a nationally recognized smart real estate professional services company that was started in 2004. Intelligent Buildings provides planning and implementation of next generation strategy for new buildings, existing portfolios and urban communities. Tom is a speaker and collaborator with numerous universities and national laboratories, a gubernatorial appointee for energy strategy and policy and founding Chairman of Envision Charlotte, a Clinton Global Initiative.
As CIO at Meridian Capital, Sandy Jacolow oversees the firm’s nationwide innovation and technology initiatives that support the company’s brokerage, investment sales and retail leasing businesses and growth activities.
Ron Victor is a Silicon Valley based technology entrepreneur with 20 years of experience and expertise launching new ventures at start-ups and fortune 1000 technology companies. To-date he has enabled raising more than $30Million in start-up capital for multiple start-ups in silicon-valley. Ron has founded and led three companies to-date with successful exits. His latest venture is IoTium Inc. – a Silicon Valley start-up that provides a secure, cloud-managed, easy-to-deploy software defined network infrastructure for all IoT verticals.
Coleman Wolf has extensive experience developing enterprise-wide access control and alarm monitoring systems, developing business analyses, and conducting detailed security surveys and assessments of corporate offices, power generation plants, and facilities related to national critical infrastructure. Coleman has also managed numerous security system installation and upgrade projects. He holds a Master of Science, Computer Information Systems degree from Northwestern University and a Bachelor of Science, Electrical Engineering degree from the University of Michigan. He is also CPP (Certified Protection Professional) and CISSP (Certified Information Systems Security Professional). Coleman also holds the following Professional / Civic Affiliations: ASIS (Member of American Society for Industrial Security), Chairman of the ASIS Information Technology Security Council, and is an active member of the ASIS Security Architecture and Engineering Council.