What is BIM and How Is It Changing the World of CRE?
Building information modeling has the potential to revolutionize commercial real estate construction.
The construction industry has been slow to evolve, especially in the realm of commercial real estate (CRE). In many ways, the construction process is not dissimilar from how it was when the first skyscrapers were built. However, as technology begins to change various parts of the industry, especially how all stakeholders communicate, building information modeling (BIM) is playing a larger role.
What is BIM?
BIM stands for building information modeling, and it's essentially a way to create as detailed a model of a potential building as possible so that architects, developers, and construction managers can collaborate and answer questions before and during the construction process. The benefit of this is that all parties can share information and potentially avoid costly mistakes.
In the past, an architect would draw up two-dimensional plans on paper, and there might be a 3-D model to show what the building should look like. Now we are able to create a very detailed computer model. This model doesn't just show how the building will look, but it makes it possible to add in details on materials, building specifications, performance requirements, and other important data regarding how the building will function.
One of the core benefits of BIM is that it can be used to run potential scenarios. This is increasingly critical as climate change and other disruptions become more common. BIM can be key for risk management and can also be used by architects and engineers to explain certain building decisions.
The types of BIM can vary, but in general, the most important factor is that it be easy to use by all interested parties. The biggest challenge in BIM might be the adoption process. Those who have worked a certain way for many years can be resistant to change, especially when there is a learning curve. BIM has existed for many years, but recent advances in the software have made it more detailed and usable.
Ali Ramadan, an attorney at Goodwin Law, reports that another factor that is fueling adoption is that more governments have been mandating the use of BIM technology for public infrastructure projects.
How is BIM used?
Each participant in the development of a building uses BIM differently.
|Architects||Visualize designs and make changes as needed.|
|Developers/clients||Understand costs and timing.|
|Construction managers||Estimate material and labor costs.|
|Building managers||Understand the structure of the building for maintenance, renovations, and improvements.|
Often, the architects and developers are the first people who are involved in the beginning stages of modeling the building and creating the model. But while they often start the model, it's the collaboration of all interested parties that makes BIM truly useful. The various construction managers, including electricians, plumbers, and contractors, can bring in their data and estimates to allow the developer to more clearly understand all of the components.
One of the core advantages of BIM is that it essentially acts as a living document for the building. A building is a complex ecosystem; one small change, such as a change in the supplier of lighting fixtures, can have ripple effects throughout the whole project. One of the more costly components of construction is having to go back and adjust the original plan based on changes. Using a collaborative system keeps everyone on the same page, both literally and figuratively.
Once the project is completed, the BIM model also lets building managers and other end users see all of the details of the building. This can be helpful for renovations and improvements as well as for determining ways to implement energy efficiency and smarter ways of managing the building. As technology continues to evolve, managers can look at the building model to determine how to make changes to keep the building up to date.
"Architects and developers use BIM to generate and visualize designs and models for construction projects from start to finish based on all project information within the BIM model," notes Ramadan. "This enables the ultimate client to visualize the built asset pre-construction, input on design, and make any changes before work commences, leading to a better-quality end product and cost-saving efficiencies."
The potential risks of BIM
One of the biggest challenges that BIM faces is adoption. There are a variety of different programs, and although there are a few leaders in the field such as Autodesk (NASDAQ: ADSK), not everyone always uses the same system. There is also a significant cost involved, in terms of both the software itself and the training.
Another concern is keeping data safe. "With any data sets, there is always a cybersecurity risk, and BIM models are no exception," adds Ramadan. "BIM models may contain rich data/information about the operation and performance of a building, which in the case of public buildings (i.e., airports, hospitals) will include highly sensitive data, so it is likely BIM models will be targets for attack, and therefore appropriate security measures and protections will need to evolve."
The future of BIM
The potential of BIM may extend beyond usage in a single building. As more governments integrate BIM into public infrastructure, there is greater potential to create smart cities that use BIM to model not just a building but a whole neighborhood.
"The biggest opportunity with BIM technology is the potential for convergence with the internet of things, the information sharing economy, and smart city initiatives to pave the way for a truly digital economy for buildings and infrastructure," says Ramadan.
An example of this is the work being done by Alphabet (NASDAQ: GOOGL), Google's parent company, in Toronto. Sidewalk Labs, an Alphabet subsidiary, is working on Quayside, a project to create an entirely new neighborhood in Toronto. In January, Sidewalk published plans for a tall-timber building visualized in BIM 360.
Like all aspects of technology, BIM has benefitted from increases in computing power and the ability to integrate large data sets easily. The COVID-19 outbreak has shown how valuable virtual models are in all industries where a site visit isn't advisable. This situation could help spur greater interest and more widespread adoption of building information modeling.
Better Returns - half the volatility. Join Mogul Today
Whether over the 21st century, the past 50 years... Or all the way back to more than 100 years... Real estate returns exceed stocks with SIGNIFICANTLY less volatility! In fact, since the early 1970's real estate has beat the stock market nearly 2:1.
That's why we launched Mogul, a breakthrough service designed to help you take advantage of this critical asset class. With volatility spiking, Mogul members have been receiving investing alerts with projected rates of return of 16.1%, 19.4%, even 23.9%, and cash yields of up to 12%! And these aren't in some 'moonshot' penny stocks or biotechs, but more stable multi-year real estate developments that don't see their value swing on a daily basis like the stock market.