• San Francisco

The Impact of Electric & Autonomous Vehicles, Ride-Sharing, and Drones on Commercial Real Estate

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Sandra Boyle, Senior Managing Director of Asset Services in Northern California, comments on the impact of electric vehicles (EVs), autonomous vehicles (AVs), ride-sharing apps, and drones on commercial buildings. Parts of Sandra’s comments were featured in the April edition of Building Operating Management.

As EVs catch on, will more buildings provide charging spaces?

The incentive to provide electric vehicle charging stations has never been more relevant in California and particularly the Bay Area. This is demonstrated on both the state and the local levels and is reflected in both government regulations or for marketing and addressing competitive pressures to provide as a building amenities. California makes up nearly 50% of the electric vehicles sold in the U.S. with 365,286 registered vehicles as of December 2017.

With respect to commercial real estate, California law provides a framework for tenants to request permission from their landlords to install electric vehicle charging stations. AB 2565 added new Civil Code Section 1947.6 (residential tenancies) and 1952.7 (commercial tenancies). There are, of course, restrictions that limit the number of spaces. So, for the landlord there are two ways of looking at providing EV charging stations: 1) the tenants are given a framework by law and 2) consider the EV charging stations as an amenity. State, federal, and local funding is available in the form of rebates and tax credits for the EV charging stations.

A flurry of new development in San Francisco has forced the City to introduce new legislation concerning the charging infrastructures. The City has set out ambitious goals for increasing the number of EV charging stations.

In January 2018, the EV Readiness ordinance was placed into effect, which requires new residential, commercial, and municipal buildings to have sufficient electrical infrastructure to simultaneously charge vehicles in 20% of all parking spaces. On day one, a new building will be required to have circuits for EV chargers installed in 10% of parking spaces, with the capability to expand from there in order to meet tenant needs.

Similarly, if AVs catch on, they likely will impact demand for parking. Ride-sharing apps may already be affecting parking demand. How might these trends impact parking structures, as well as any EV infrastructure that has already been installed?

There is no doubt that self-driving autonomous vehicles have arrived.

Parking Demand will decrease.

The trend has already been seen in our San Francisco parking garages, whether because of congested traffic, the increased usage of Uber and Lyft, or the fact that San Francisco is a transit first city, which requires less parking availability. With the onset of AV’s, especially with shuttle and commercial vehicles such as taxis and Ubers, this trend will continue. Albeit that Uber has increased the traffic on the road, it has helped to reduce parking needs.

Companies like Waymo (Google) and Fiat Chrysler are all working on or will be producing and selling AV’s in the next 18 months. The Navya Autonom Shuttle – already launched in Las Vegas and at the University of Michigan – will change the way we get to the airport, move around office campuses, and receive deliveries to our properties.

Cities such as Walnut Creek, Emeryville, Dublin, and Los Gatos are all working on the infrastructure to prepare for AVs.

The Future

  • Shuttles to and from transportation hubs
  • Grocery and food deliveries via AV vans
  • Autonomous police cars – already a patent pending with Ford Motors
  • FedEx deliveries/pickups

How might drones impact repair and maintenance of existing buildings, as well as security?

Today, we still rely on physical, electronic, and mostly human security protection. The future of security will revolve around drone technology utilized to protect assets by patrolling consistently, in any weather condition any time of the day or night. Drones can be continually scheduled to patrol the skies above and around buildings while the operators are in a fixed, distant location. Thermal cameras will provide coverage in the dark, rain, or fog, and change detection analysis, and the ability to be deployed will be a simple process. They will be equipped with infrared cameras and thermal imaging and will be able to handle blind spots in the security camera system. They will problem-report into regional security centers.

The Future

  • Drone hubs located on building tops – could be an opportunity for revenue-sharing
  • Indoor small drones replace the fixed security cameras

With distribution centers, industrial buildings, and other assets, repairs, maintenance, and roof inspections can be done quickly and efficiently. Parking lot scans can detect areas that need maintenance and map out repair or overlay.

And with all these developments, are there other issues facilities managers and owners will want to consider?

As an industry, we are usually very slow to adapt to change because the capital infrastructure of our ownership does not allow for quick and expensive change. Our industry will vet new technology, determine the cost effectiveness of that technology, and only deploy after careful consideration. This does not relate to EV charging stations, as this is very real and today.

Security companies offering drone technology will be a slower process. Vetting the use, licensing, risk, and liability will be a very detailed, complex process.

  • San Francisco

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