Data that matters
At Vercity we have been on a data journey. From collecting comprehensive asset data, through the frustration of data paralysis from the sheer volume of it, to finally arriving at a more settled view on preserving the data that matters.
The purpose of our data is to help us manage property and in particular, lifecycle funds.
The Vercity Approach
Each of our building projects has hundreds of thousands of assets, or components, each with unique data e.g. size, specification, cost, condition, residual life, life expectancy, manufacturer, serial number, guarantee. The thinking was that to be in control of the lifecycle fund and building performance we need to be in control of each asset. So we collected this data across all our projects with some of our lifecycle models running to 225,000 database lines.
Of-course this data is constantly changing, not least when an asset is replaced, so requires continuous updating. This time-consuming data maintenance risks resources being spread across all assets at the expense of a focus on priorities. We therefore tested and confirmed the 80/20 rule, when the results of one of our hospital projects showed that 17.5% of assets contributed to 80% of the lifecycle fund.
This recognition was an important step in facilitating route to value thinking leading to the optimisation of real estate assets to protect future value.
Insights and result
A key asset strategy followed whereby energy is concentrated on the top 10-20 assets. Selection is based on their cost significance and criticality e.g. chillers, lighting, BMS, flat roofing, flooring. This focus led to easy wins such as competitive tendering for 5 years of redecoration work providing value and cost certainty to an expensive item. More complex assets require a long-term strategy involving specialist surveys, procurements partnerships, obsolescence and other risks, replacement methodology, innovation, spares strategy and ESG.
The important outcome is a more detailed and robust lifecycle cost model and associated strategy for each key asset, which together deliver cost certainty to a significant proportion of the fund. The other main outcome is a recognition that the less significant assets, which must still be managed, can be done in a proportionate manner such as in groups, rather than individually e.g. grouping smaller items of FF&E and reactive works.
Reflecting on the Vercity data journey we have learned that thorough data analysis first time around puts you in a strong position from which to either develop further, leave as is, or take sensible short cuts.
We have done all three and learned to move resources away from the relatively unimportant data to further develop the key data.
A shift towards significant items estimating as it used to be called in the QS world. The toilet roll holders can look after themselves.
What’s your Route to Value? Vercity can help you maximise your real estate assets for success. Get in touch with our team for an initial conversation, or even to develop a bespoke webinar to optimise your portfolio.
Gary Best, SAM Associate Director