Fifth Wall Investment and Strategic Partnership with Enertiv
Investment Supports Rapid Expansion for Best-in-Class IoT Platform for Real Estate Operations and Energy Management
Energy and maintenance costs comprise nearly 50% of total operating costs in commercial and multifamily buildings, while accounting for almost 20 percent of the nation’s annual greenhouse gas emissions. Given the dollar amounts these percentages represent, it is clear an effective energy and operations management strategy is critical for minimizing costs and running a successful real estate enterprise.
Fifth Wall is thrilled to officially announce its strategic investment and partnership in Enertiv. Enertiv’s innovative solution utilizes advanced proprietary meters and IoT (Internet of Things) sensors to offer real estate enterprises targeted insights, automation, and transparency. Enertiv’s platform continuously tracks equipment-level (elevators, chillers, boilers, pumps, cooling towers, elevators) performance, the indoor environment, and utility consumption to deliver full transparency into building operations for landlords and operators. With its proprietary EnertivTwo Meter, Enertiv is a clear leader in bringing equipment-level data and “smart building” capabilities to the more than 90% of multifamily, office, and industrial assets lacking any data beyond a utility bill to drive daily operations. Fifth Wall is excited to bring Enertiv to our growing portfolio of ground-breaking real estate investments.
Enertiv’s unique value lies in its ability to deliver insights and bring transparency to energy usage, maintenance, and tenant comfort. The platform quickly delivers actionable analyses through visualizations and direct notifications while helping identify root cause of performance issues. With these insights, Enertiv facilitates 10%-15% in decreased energy and maintenance-related costs to best-in-class real estate portfolios. Given the level of energy consumption seen in real estate today, these potential savings can easily equate to millions of unlocked dollars in property values (by increasing Net Operating Income) across various asset portfolios. Due to low implementation costs, Enertiv’s solutions generally have a payback period of under 2 years (and up to as fast as 6 months).
Even more, Enertiv’s solution is not confined by or limited to data from its proprietary meter, the EnertivTwo. IoT sensors placed throughout the building connect wirelessly and supplement the EnertivTwo’s equipment performance data. Enertiv’s open platform even allows for integration with third-party meters and sensors enabling measurement of important environmental factors — such as air quality and water quality — much more cost effectively than closed systems.
This continuous tracking of every critical piece of equipment in a building provides operators real-time and predictive fault detection. Additionally, the ongoing equipment-level tracking capabilities affordably enables the “smart” system to pinpoint specific areas of inefficiencies in utility consumption on an ongoing basis — this is impossible to do with the vast majority of energy management solutions today that are only able to capture building-level data alone.
After surveying the landscape, we feel that Enertiv is the company that is best positioned to immediately provide comprehensive energy and maintenance systems to office, multifamily, and industrial assets that have historically provided very low levels of data and insights to their managers. The platform they have built is aimed at addressing every aspect of building operations: equipment reliability; maintenance productivity; electricity, water, and gas efficiency; tenant submetering; and occupant health and comfort. The intuitive nature of Enertiv’s solutions come as a welcome reprieve for an industry used to legacy systems.
Access and distribution with Fifth Walls’ strategic distribution footprint is a huge boost for Enertiv’s customer base. This deal came highly referred to Fifth Wall. The Rudin family, a LP of Fifth Wall, previously invested in Enertiv and has already initiated paid pilots. Beyond a strong recommendation by the Rudin family, Enertiv is already in preliminary discussions with other Fifth Wall LP’s to identify significant cost savings within their respective portfolios as well. Each additional networked smart building adds real-time data and further bolsters the predictive capabilities of Enertiv’s platform, providing greater value to Fifth Wall’s engaged partners as the company scales.
The Future of Smart Buildings
The investment marks one of Fifth Wall’s initial plays into our “Smart Building” thesis and timing is perfect for Enertiv to become a category leader in this area. As smart cities and buildings become more than buzzwords, Enertiv adds smart building capabilities for the long tail — comprising the vast majority of real estate assets without data capabilities. Enertiv’s installation process costs a fraction of the more than one million dollars that it can cost to implement even the most traditional of building management systems. In fact, measured on a per-equipment basis, the EnertivTwo meter is the most affordable on the market.
Even beyond cost-savings aspects for building owners and real estate enterprises, customers also drive the demand for smart buildings able to enhance their lives. Tenants want more from their spaces, and building owners increasingly recognize a utility bill at the building level is not enough. As studies continue to link indoor environmental conditions and productivity, more commercial tenants will consider office conditions as a major competitive factor. Enertiv tracks indoor environmental conditions to trigger a notification if, say, indoor CO2 levels are threatening productivity.
Ongoing cost savings are only one aspect of Enertiv’s appeal. The data provided by Enertiv’s platform enables real estate companies to make better informed decisions about retrofit projects. By measuring historic costs exactly, companies can verify retrofit proposals for accuracy and precisely know what the payback period. For equipment that will remain in a building for up to 25 years, making the right decisions upfront pay dividends in the future.
Reducing operating expenses is the primary strategy to maintain profitability and long-term asset value. Enertiv addresses the two largest contributors to operating expenses: maintenance and repairs, and utility consumption:
Maintenance and repairs: By continuously tracking every critical piece of equipment in a building, Enertiv provides building operators with real-time and predictive fault detection. Instead of wasting time on investigations to uncover the root cause of issues, maintenance teams are directed to the exact piece of equipment causing the problem. This can bring the time from failure to repair down from a few weeks to a few hours. Beyond saving on labor costs, it also extends the useful life of equipment and improves tenant comfort.
Utility Consumption: Enertiv’s unique ability to capture equipment-level data in real time uncovers inefficiencies in utility consumption that is not possible with building-level energy management solutions. For example, large buildings are often charged by the electricity utility for the highest 15-minutes of energy consumption during a billing period. Where previously operators were at the mercy of the peak demand billing strategy, they now can identify the exact sources of high energy consumption, smooth out the peak, and reduce the rate for the entire billing period.
Fifth Wall accelerates the growth of companies positioned to disrupt the real estate technology worlds in which they operate. Enertiv is such a company; we are excited to equip owners, operators, engineers, and property managers with Enertiv’s platform to reduce operating expenses, make informed decisions, and maximize occupant health and comfort. Our real estate footprint is an unparalleled distribution advantage for Enertiv to catapult it into a smart building and energy IoT market leader. Whereas other IoT solutions provide point solutions to specific problems, Enertiv addresses building performance holistically with in an innovative platform designed to scale.
