Real Estate IoT Use Case – Castellum

Castellum is a Swedish real estate company with properties in 17 Swedish cities together with Copenhagen and Helsinki.

Their 650 buildings amount to 4,5 million square meters, 6 000 business customers, and 300 000 private customers. The company’s business focuses on offices and logistics. In addition, they have the company United Spaces in Sweden for coworking, which constitutes a favorable testing ground for new services and business models.

Niclas Ingeström is Chief Digital Officer at Castellum, in charge of digital business development, and board member of 10 companies under the Castellum umbrella. During Sensative’s 2021 Yggio Day, Ingeström held a presentation on Castellum’s digital strategy and how Sensative helps pave the way for its realization.

Vision
Castellum has traditionally been an ordinary real estate company, renting out space and not adding any value-added services for their customers. However, a paradigm shift happened when the company decided to invest in digitalization and find new business opportunities through digital services – to become a leader in the modern innovative real estate market. Recently replaced CEO Henrik Saxborn hired Ingeström to revolutionize their business model and left us with a powerful statement:

“In 2030, 30% of sales shall consist of innovative and digital services.”

Considering the size of the company, this is not a small number. From focusing on sustainability to equality, Castellum has now broadened its focus to include services. Ingeström developed a 10-year roadmap, and they are now steadily following its trajectory.

In their digital quest, Ingeström highlights the value of data and knowing how to utilize it properly. He highlights how many companies like to talk about new models and businesses, but very few realize their visions. And for those who do, he sees them focusing too much on technology and less on the actual value. Ingeström states that if you have substantial data on an adult customer, all of its habits, and know how to utilize it correctly, that data is on average worth $35 annually. For their data gathering, Castellum focuses on the 300 000 private customers that visit their buildings daily. With $35 per person, the company is looking at a potential value of about 9 million USD per year.

Castellum’s digital strategy
“Digitalization strategies are boring,” Ingeström says. However, the company wants to implement new technology to make innovations, so they have established a technology and innovation strategy as an alternative. The strategy consists of four parts:

Cognitive buildings
Cognitive buildings are smart buildings powered by machine learning and AI. The buildings not only detect issues but also take proper action when they arise.

Simplify work life
Offering services to upsell to existing customers. Services that make life or workdays easier include furnishing, printing, wifi, and other suitable commodities. The services resemble those provided at coworking spaces, but Castellum wants to offer these to all their customers.

People transformation
People transformation is all about changing people’s attitudes towards the digital. The company has created an app where they can gather all services to be available, and it simultaneously gives the company valuable information on customer habits.

Innovation
Thinking outside the box and offering new services and business models.

Product development
marketing strategy iot use case
By simultaneously developing several products to launch, Castellum shows that they genuinely believe in their new business model and dare to make the necessary investments to establish an ecosystem of services in one push. Ingeström highlights their cyclical product development strategy.

Think – communicate – build – test – deliver – follow-up

He explains that follow-up is the most crucial part of the cycle as their products will always remain in the development process – open for revision based on gathered data, customer inputs, and other insights.