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How Artificial Intelligence Saves Tens of Thousands of Euros on Building Management

Real estate company Kapitel embarked on an ambitious collaboration at the beginning of 2023 when they joined forces with the unique company R8 Technologies.

The Estonian property technology company has developed a solution that allows for smart prediction-based control and management of commercial building climate systems using artificial intelligence. The need for collaboration and the challenges are described by Margus Reinberg, the Director of Administration and Engineering at Kapitel Group.

According to the Technical Director of Kapitel, a change in values encouraged the company to take a step forward in the real estate sector. “Just like in any other industry, sustainability, digitalization, and energy costs have become a focal point in our portfolio. We aim to provide our clients with the best available service in the market, which is why resource efficiency is a daily focus for us. Since R8’s mission aligns with our goals, initiating collaboration with them was simply a logical step,” said Reinberg.

Today, R8’s digital management system is in use in Kapitel’s Delta Plaza, Sõpruse Ärimaja office buildings, and Viru Keskus in Estonia. Expansion has also taken place in Riga, where the smart management is applied in Spice Home shopping center. In the near future, according to Reinberg, R8 technology is planned to be implemented in the I.P. Pavlova office building in Prague and the Elmental Business Centre office buildings in Riga, which will be completed in the autumn. This way, artificial intelligence manages over 100,000 square meters of Kapitel’s commercial space.

Agreeing on common goals

Reinberg acknowledges that while setting up a digital operator is not inherently difficult, it is a lengthy process to ensure smooth collaboration between the two companies.

“In the first few months, when the connections were established with our building systems, R8 technology got to know and manage the buildings. During this period, we didn’t actually have to do anything. After that, we agreed on the gradual takeover of the technical system management,” said Reinberg.
According to him, both teams have invested in ensuring close collaboration between the building management team and R8. “It is important to agree from the very beginning on how to address any potential issues that may arise. And it is also important to understand the goals and outcomes of why we are using R8 and what we want to achieve through it.”

From the very beginning of the process, suitable indoor climate parameters were established. To have a comprehensive overview of the measurements, all necessary information is fed into R8 engineers’ software to continuously map tenants’ feedback. “This allows for better management of technical systems and a quick response to our clients’ feedback,” described Reinberg.

As Kapitel is a recent user of artificial intelligence, the success of the collaboration is most easily evaluated, according to Reinberg, through the existing energy efficiency and resulting cost savings. Incorporating R8 has monthly saved Kapitel an average of 20% in energy costs. In addition to the financial gain, the R8 engineers have provided valuable insights into the functioning of the portfolio’s buildings and technical systems as a whole.

People were hesitant about artificial intelligence

According to Reinberg, the maintenance team of Kapitel initially approached artificial intelligence as a “colleague” with caution. “It is logical that the word ‘artificial intelligence’ may not sound very inviting to everyone. It is all the more important to understand that behind the management systems, there are still people who work with you towards a common goal,” said Reinberg.

“Our people’s biggest concern was whether the quality of indoor climate in the buildings would be compromised in the pursuit of energy savings. There were also questions about how the handover of the building to the R8 team would actually look like. We consider it very important that tenant feedback reaches R8 directly and that the maintenance team sees that every issue is addressed and communication is functioning,” described Reinberg.

In order to reach the common goal, the R8 team is also provided with monthly reports and results, which help focus on providing an increasingly sustainable service. The expectations for the future are even greater: since artificial intelligence learns over time and there are no exceptions in achieving 40% energy cost savings and carbon emissions reduction, the collaboration promises even better results in the future.

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