The building that knows when you are in

When Anika’s design studio moved into a renovated mid-rise last spring, the welcome package came with a phone app instead of a key fob. The app opened the lobby doors, called the elevator, booked the shared boardroom on the fourth floor and showed a small dashboard of air quality readings for her suite. Within a month, she noticed something else. On Fridays, when most of her team worked from home, the lights in the unused half of the studio stayed off and the air handling eased back. On Tuesdays, the busiest day, the space was comfortable by the time the first person arrived.

The building, in other words, knew when her team was in. That is the promise of what the industry calls smart-building technology, and it is quietly becoming standard in newer and renovated commercial property. For a small tenant like Anika — a composite of several business owners I spoke with — it raises practical questions that rarely appear in the leasing brochure. What is being measured? Who owns the data? And who pays for the system?

What the sensors actually do

The term covers a wide range of equipment. At the simple end are motion and occupancy sensors that switch lights and adjust ventilation when a room is empty, which have been around for years. Newer systems add people-counting sensors at entrances, desk-level sensors that detect whether a seat is in use, and access-control platforms that record when a badge or phone credential opens a door. Environmental sensors track temperature, humidity, carbon dioxide and sometimes particulate levels.

All of that feeds a building management platform, which the landlord or property manager uses to run the heating, cooling and lighting more efficiently. Increasingly, a slice of that data is surfaced back to tenants through an app or a portal: how full your floor was this week, which rooms are actually booked and used, what the air quality looked like on the day everyone complained about headaches.

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The building has always known roughly when you were in. What has changed is how precisely, and how long it remembers.

Why landlords are installing it

For landlords, the business case is mostly about operating costs and energy. Heating and cooling empty floors is expensive, and with hybrid work leaving many offices partly occupied on any given day, matching building systems to real occupancy can cut energy use. Several provinces and cities have also introduced or are considering energy and emissions reporting requirements for larger buildings, which gives owners another reason to measure closely. The specifics vary a great deal by jurisdiction, so it is worth asking your landlord whether the building is subject to any such program.

There is also a leasing angle. A building that can show prospective tenants clean air data and a polished app looks more modern than the one next door. Some owners use aggregated occupancy data to plan amenity spaces or to decide how to reconfigure floors when tenants downsize.

The privacy question tenants should ask

Most occupancy sensors are designed to count, not identify, and the better systems are built that way deliberately. But access-control records and app logins are tied to individual people — your employees. In Canada, the handling of personal information by private businesses is governed by federal privacy law, and Alberta, British Columbia and Quebec have their own private-sector privacy statutes that apply in place of it for many organizations. Which law applies to a given building and data flow is not always obvious.

As a tenant, you also have obligations to your own staff. If the building is collecting data about your employees’ comings and goings, you may need to tell them, and you will want to know whether that data could be shared with you, with the landlord’s vendors, or with anyone else.

Who pays for the clever building

Here is where the leasing editor in me takes over. Smart-building systems cost money to install, run and maintain, and in a net lease, much of a building’s operating cost flows through to tenants as additional rent. Whether the capital cost of new technology can be passed through depends entirely on how your lease defines operating costs. Some leases exclude capital improvements outright. Others allow them to be amortized over their useful life and recovered as part of operating costs, sometimes with interest. Many allow recovery of capital spending that reduces operating costs, which is exactly how a smart-building upgrade is usually justified.

An illustrative example: suppose a landlord spends $300,000 on a building-wide sensor and controls upgrade in a 100,000-square-foot building and amortizes it over ten years. That is $30,000 a year, or 30 cents per square foot, before any interest. On a 3,000-square-foot office, that is $900 a year. If the system genuinely lowers energy costs, the saving may offset it. If it doesn’t, you are paying for the landlord’s dashboard. Software subscriptions for tenant apps can also show up as an operating expense, so ask.

What to ask on your next tour

None of this is a reason to avoid a well-run smart building. Anika’s team likes theirs, and the boardroom booking alone saved them from leasing a larger suite. But it is a reason to ask better questions before signing.

The building may know when you are in. You should know what it does with that information, and what it costs you every month.