Smart Ready Buildings for People and Resource Flow in Sharing Cities - Final Report

The European Union (EU) is driving the modernization of buildings in response to the global climate crisis and its carbon reduction targets. Buildings represent 40% of energy consumption and 36% of energy-related emissions, with 75% of the existing building stock being inefficient. In light of this, the EU has introduced several policy initiatives, such as the European Green Deal (2020) and the "Fit for 55" package (2021), focusing on the vital role buildings play in achieving climate goals. One major initiative is the Energy Performance of Buildings Directive (EPBD), initially introduced in 2002 and revised in 2010, 2018, and 2024. The latest revision, published in August 2024, highlights the importance of smart building technologies for enhancing efficiency across the sector.
Despite advancements in smart building technologies, their implementation and benefits remain underrecognized within the real estate industry. The Smart Readiness Indicator (SRI), introduced in 2018 as a voluntary scheme, supports the smart transition. The 2024 EPBD revision proposes mandating the SRI for larger non-residential buildings, underlining the growing importance of smart technologies. However, the impact of smart technologies on the real estate sector has been limited. The existing focus on energy efficiency and operational cost reduction does not sufficiently motivate real estate owners and investors to embrace a widespread smart transition.
This report aims to enhance the role of smartness rating scheme SRI in fostering the smart transition by clarifying the link between smart building capabilities and real estate market preferences. It presents research studies assessing the technical feasibility and economic viability of smartness rating schemes, identifying the main reasons for their limited acceptance in the real estate industry. Although the SRI scheme is technically feasible, its acceptance depends significantly on end-user perspectives.
This research report introduces the Smart-Ready Buildings (SRB) concept as a solution to help facilitate the smart transition in real estate. While the concept is based on the SRI rating scheme, which is expected to become the de-facto standard for smartness ratings in Europe, the underlying logic is applicable to other types of rating schemes as well. The report will introduce and summarize the primary research work that led to the development of the concept.
The report does not predict whether the SRI will become the de facto standard for building smartness in Europe. It may be that another rating scheme will emerge. However, the SRI is included in the EPBD, emphasizing its energy-related focus. For successful implementation, understanding the real estate market demand is crucial.
The results in this report summarize the findings of the “Smart-Ready Buildings for People and Resource Flow in Sharing Cities” research project, led by Professor Seppo Junnila’s Sustainable Real Estate Business Research Team at Aalto University’s School of Engineering, Department of Built Environment. This document serves as the final report, presenting the summary of project's more comprehensive results.