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Episode #27 reaction: why we can't count on connectivity

November 12, 2020

Happy Thursday!

Welcome to this week’s deep dive exclusively for Nexus Pro members. It’s an honor to have you here. This deep dive is a follow up to my recent podcast conversation with Joe Gaspardone, COO at Montgomery Technologies. I learned a lot from this conversation and want to share my takeaways and the full transcript with you below.

In case you missed it in your inbox, you can find the audio or video here:

Nexus site | Apple Podcasts | Spotify | YouTube | Add to other podcast apps

Enjoy!

—James


Outline

  • My reaction, including highlights
  • Full transcript

My reaction

First of all, Joe’s energy and enthusiasm are very contagious, right?! Love that optimism!

I don’t know about you, but it was beneficial for me to have Joe explain what a base building network actually is and cut through the buzzwords. It means: change management, SLA with 99.99% uptime, locked cabinets with codes, redundancy, etc.

I also loved Joe’s commentary on how a lot of the network issues we’ve talked about on previous podcasts are simply symptoms of not having this in place. We “can’t count on the connectivity”, for remote advanced supervisory control for example, because the BMS vendor built it and has no idea what they’re doing and no one is managing it.

The use case library I mentioned is something I truly might build out. If I connect to these silos, what does that enable? Have you seen anything like this before?

It was interesting to hear Joe’s answer to my last question. Less than a handful of the buildings he’s seen are integrating systems together with any sort of common data model for the building. They’re all 1-1, sort of bespoke connections between each system. “It’s ugly”, he said. And the owner’s perspective he provided is just as interesting: “I only need this for this purpose”.

My highlights:

  • Joe looks back at the evolution of technology in commercial real estate, and offers what his experience tells him is THE answer to James’ favorite question (6:37)
  • What is riser management? (13:29)
  • Translating the buzzwords: enterprise network, base building network, IP convergence (20:32)
  • A taste of the breadth of systems getting connected to buildings these days (25:41)
  • And what you can save by connecting them with a converged network (31:16)
  • Examples from the field of the importance of starting with connectivity to enable a smart building (35:05)

Full transcript

Note: transcript was created using an imperfect machine learning tool and lightly edited by a human (so you can get the gist). Please forgive errors!

James Dice: [00:00:00] Hello, friends. Welcome to Nexus, a smart buildings technology podcast for smart humans. I'm your host, James Dice. If we haven't met before, I write a weekly newsletter on the same topic. It's also called Nexus. Each week I share what I've learned, my opinions, and what I'm excited about in the quickly evolving world of intelligent buildings. Readers have called Nexus the best way to stay up to date on the future of this industry without all the marketing fluff. You can check it out and subscribe at nexus.substack.com or click the link in the show notes.

Since starting the Nexus newsletter, many of you have reached out to me wanting to talk shop, and we have. After a few weeks of those wonderful conversations, I realized I needed to record and share them with our growing community. So here we are. The Nexus podcast is born. This is our chance to explore and learn with the brightest in our industry together.

Episode 27 is a conversation with Joe Gaspar, Doni,  of Montgomery technologies out of California, and someone who has a unique background in both the commercial real estate and technology. Joe gave his answer to my favorite question and talked about how the base building or enterprise building network enables smart building technology and what can happen when that enabling step is skipped. This is a great primer for those of us in the nexus audience who know the smart building resolves around the connectivity of the building automation system but are just beginning to wrap our heads around what happens when all the other types of things in the building start coming online

This episode of the podcast is brought to you by nexus pro nexus pro is an annual or monthly subscription where members get exclusive writing podcasts and an invite to a monthly members only event.

You can find info on how to join and support the podcast@nexusdotsubstack.com. This episode is also brought to you by nexus foundations, an introductory course on smart buildings. If you're new to the industry, this course is for you. If you're an industry vet, but want to understand how technology is changing things.

This course is also for you. Cohort two is set to kick off in winter 2021, and you can enroll@courses.nexus labs.online without further ado, please enjoy this episode of the nexus podcast.

All right. Hello, Joe. Welcome to the show. Welcome to the nexus podcast. Thank you for coming on. Can you start by introducing yourself

Joe Gaspardone: [00:02:32] for us? Joe Gasper, doing COO of Montgomery technologies. Montgomery is a riser manager and secure network provider. So two divisions, one company.

James Dice: [00:02:44] Cool. And we're going to dive into what all of that means. Can you start though, but telling us how you got here. So, and then you have a history in real estate. So tell us about your career history.

Joe Gaspardone: [00:02:55] A long and winding road. Um, came out of college, went to work for, uh, equity, property management bank.

Property management company. did some acquisition disposition work, got my brokers license and I, I started my own, real estate company,  syndicating deals.  when you're growing a, a real estate company, you basically are doing everything. I was involved with finance, you know, contracts you, name it in the, sort of path of, for growing a business.

, I was doing it and then we got to a point where.  the software needs were, we're just not meeting. What we needed to grow. And,  that led to founding a software company, long story there, but we founded an enterprise property management software company,  started that in like 95 or 96, saw that.com boom and bust go right through what we were doing, which was, was actually software.

It was like client server software , exited that in 2001,  sold it to a larger, management software company.  but not before we'd signed up our first two REITs. So we really got all the way through the, the system and the scale of growing that software company went back to commercial real estate in 2001.

And then, Greg Jones, the president of Montgomery's a good friend of mine. And I helped him found it and sort of acted as an advisor over the years. And so fast forward, 15 years. And I come in as the COO and, uh, the last four years it's just been an awesome ride. It's been growing. Both sides of the business, riser management and intelligent riser, which is the secure network piece.

And watching these divisions develop and mature people, you know, it takes a year to get really effective in your role in this business. So, yeah. Watching that mature over time and people now have three and four years experience just being able to go out and do it. So it's a, strange combination.

I really do sometimes feel like a unicorn of like, hardcore operational experience and a pretty deep technology experience. So it's been a, it's been a great ride though. You don't, you don't get that opportunity very often.

James Dice: [00:05:05] That's amazing. Cool. Thanks for taking us through that. also stumbled across a wine app on Google. Is that you?

Joe Gaspardone: [00:05:14] Yeah. Yeah. That's me. You know, when a 2008 hit, we were sitting in the middle of this giant recession and we had prepared for it. we were fortunate to have somebody who is up. Commercial real estate appraisers part of our group. So we were a little bit like the Canary in the coal mine, and we could see a lot of that coming and we restructured leases.

We retrenched. So we actually came through it pretty intact. I mean, nobody was perfectly intact, but we, we came out of it in pretty good shape, but there were like two or three years where you'd show up for work. And there was was literally nothing to do. The markets were frozen.

no transactional stuff, no finance, nothing. You're just sitting on what existed. So this guy, and I decided now we're going to, follow our passion for awhile. We have six hours a day. Why don't we go down that road? So we created this, wine app and, um, wine channel. Um, and actually today it's still the most watched wine channel on YouTube.

If you Google, how to pronounce governor's demeanor. I come up before the definition, which is really embarrassing. No problem. I was just looking for

James Dice: [00:06:19] a headshot for you and I came across. Yeah. I came across a bunch of stuff. So,

Joe Gaspardone: [00:06:25] um, employees, get a great kick out of that. And as you can imagine, I, I see memes of myself, which is really annoying.

That's awesome.

James Dice: [00:06:33] That's awesome. Well, cool. Let's jump from there into today's topic. So as I usually do, I want to start with my favorite question. I know you're excited about this. So from your perspective, why is technology in the average building, uh, decades behind, other technology and other industries?

Joe Gaspardone: [00:06:51] Well, first of all, thank you. Because this has been like a splinter in my brain for months. and there, people are giving great answers, by the way, like they, they really do. They come up with things and like, yeah, I actually hadn't thought about it that way. But the thing I think that's missing is so many answers, the real answer is rooted in history and it's one that I lived. And so  I know it's the answer and the answer is. In 1990. In 1993 in 1994, people were using dos software. That was technology technology in commercial real estate. It was like a non-existent thing that BMS was not even considered technology.

It was considered like a refrigerator or a toaster. it wasn't technology that were things that were killing it. And it had like a serial connection to make it work. So it it didn't really qualify. Hm. And the people in commercial real estate, the founder, you know, Sam Zell, founder of equity, that guy is a salt of the earth guy and take him ledgers paper ledgers didn't make mistakes.

You could go there. You never lose it. Technology was like a roll, the dice risky proposition. So. If something worked and it was on dos, it stayed on to us through the eighties. It went all the way into the mid nineties. They're very, very slow because technology to real estate is a cost and the ROI behind it.

Was not provable. And so if you couldn't prove it, you didn't use it. So there were no CTOs. And then, you know, mid nineties that wasn't even a thing. And the first CTOs were like the weakest position in the entire organization. They just had no ability to move the ball or get anything done. So the, true answer is yes.

That technology was basically dos software, which everybody hated and nobody would come into the market. Well, you can imagine if there's no value seen to technology, then people will not develop anything in a market where they don't value it. They don't want it. So that's, that was the reality sort of aware things were.

They need kind of had incremental progress in software, but guess what happened? the.com bust. So you had people trying to develop property management software and cold fusion back then. And, these things were just wild crash and burns. And the people who tried to jump on just got, crushed by that.

And they, you know, many of them lost their jobs because it was, it was just not ready for, the enterprise level use. And the budgets weren't there to really, you know, nobody was going to pay $900,000 a year to subscribe or to pay for, online property management software. So you have this, fundamental.

Difference of, perspective where the people who ran the companies. So our technology is a risk and a cost. And then you had the markets saying, well, I'm not, going to go on in that market and develop anything technological. Cause I can't get enough uptake. And between that and the.com bust.

We just now, I mean, like, this is the beginning of finally recovering from that long cycle of where people could actually prove an ROI. Can actually show some benefits, some gain so we're just now coming out of that and it's just, you know, it's really at the national stage.  that's just  where we are as sad as that is because we're so far behind.

James Dice: [00:10:25] Yeah. Yeah. And, just like, I'm looking backwards. So you just like, caught me up from a lot of the history that happened when I was, you know, before I was 10 years old, but What I'm seeing now

Joe Gaspardone: [00:10:36] is there are a

James Dice: [00:10:36] lot of these and we're going to the real conference this week. There are a lot of real estate organizations that are participating in that and they have these CTOs.

I think one of the people on the panel that I interviewed yesterday was, uh, chief technology and innovation officer of a very large REIT. So how do you feel, what do you think has changed within these organizations like why, if they added these new roles and new perspectives?

Joe Gaspardone: [00:11:00] The biggest reason is, um, you couldn't avoid it.

It was like you know, you're standing in the street and here comes the truck or the train. And you really, there was no way around it. Eventually every new system, every new device had to have some connectivity. Property management offices really, really needed to be connected back to the central office.

Um, so, you just couldn't avoid it. And it started with the PMOs coming back to the corporate. And then, now we're just like at the beginning of this wave of connected devices in the buildings, things that people don't even think of. And so you have to have somebody at the top now to manage and organize and at least start to create.

Sort of plans, operational plans, rollout plans, things like that. a lot of them are still very weak and they don't have a lot of budget to work with, but they are now able to give like the stamp of approval on things that can actually help move the ball forward, on the sort of local building by bullying.

James Dice: [00:12:02] I'm picturing like general technology sort of like dragging along, the real estate organizations versus what you would think would be happening as an organization says, how can we use technology to strategically, you know, help our business?

Joe Gaspardone: [00:12:16] What

James Dice: [00:12:17] I'm picturing, you just described as like this, like dragging.

Into the future.

Joe Gaspardone: [00:12:22] I hate,  it. It's like I've lived it for so long and it just, it's an awful thing about this industry, but it's just the truth and it's really the historical truth. And that, that's why we're sort of where we are today. But I mean, the good news is, is you really, can look forward.

Like they're meaningful dollars going into technology. Now a lot of companies are starting in the right place and a lot are starting the wrong place in my opinion. But there are enough that are moving things forward with talent. You know, your nexus is a great example of that.

You know, you've got hundreds of people who really are the smart cream of the crop, people that are, an audience now and networking with each other. And that, is the beginning of the future. So, I mean, everybody who's here. Can see with some optimism, what we, have to look forward to so that you know, you don't have to experience the pain in the past.

Just look forward.

James Dice: [00:13:14] Know there you go. Yeah. So for all of you listeners out there, Joe thinks a whole hell of a lot of all of you, so he's excited to meet you. So,

let's talk about Montgomery real quick. So you mentioned the two sides of the business. Can you go into a little bit more detail on each side?

Joe Gaspardone: [00:13:29] Sure. So, Montgomery was founded 18 years ago, as a riser management company and rise riser management. A lot of people aren't, aren't exactly familiar with what that means, but it basically came out of when the phone companies got deregulated, they basically handed back ownership of all of the internal copper infrastructure to the buildings and said, all right, this is on you.

You handle that. We're not touching it anymore. w

James Dice: [00:13:53] when was that?

Joe Gaspardone: [00:13:54] That was, uh, just early two thousands, 2002 or 2001 right in there. Okay. And so that happened in these, you know, ATT was a regional bell there, all these baby bells, and they basically all at once.

It became deregulated and handed back this infrastructure. Now the buildings sitting on this going well, new tenants moving in, like, what do I do? And the answer became for a lot of markets, riser management. We will. Manage that infrastructure, the vertical cabling. And then we'll make sure that, you know, the two copper pairs get connected to the right, vertical PAs and they get extended to the tenant.

So that was the primitive beginning of all that, but what came out of that also was, sort of a highly evolved. Access screening process to make sure that not just anyone could get into those places because you know, the guy, if at and T got in there, they would want to do that as fast as possible, as cheaply as possible.

And they might take down somebody else. So there was a lot of the. The access restriction became a really, sort of piece of that. And that fast forward 18 years has grown into the fiber side networking side. And, that is, you know, that's sensitivity times a hundred because you have everybody's everything running through that riser.

Now you have all of everybody's cloud access, you know, high speed, transactional. you know, stock market related stuff, like you really have full business operations running through that, riser. So that, has, sort of expanded and grown over time because people realize, Hey, we need some management control over this.

And there's a real, surprisingly deep process. To the screening insurance, you know, whose gets access to what, under what circumstances, very, very specific, and then documenting all that, you know, what's there and making sure it's done to code under the building standard. There's, you know, there's a sort of a lot under the hood when it comes to riser management.

So that's that side of the business. And

James Dice: [00:16:01] where does the OT stuff come into that equation?

Joe Gaspardone: [00:16:06] Yeah. So you've got. what I call I call it the old business, the new business and the sort of OT side about 10 years ago, Greg really. Uh, this coming, it was doing some work for, for NATO and some other, large real estate players Shorenstein and they were starting to sub meter and add these meters and he said, meters needed a way to be connected.

And he kinda had a light bulb moment and saw, you know what, this is where everything is going to have to be. At some point down the road. And so right then, and it literally was like a full 10 years ago. we started doing the work of connecting these things and cabling them. But within a year or two, we decided, Hey, nobody's got a way of ensuring these things are up and running.

That there's a, network. Nobody has a network experience at all. So we started to build the first networks that could be leveraged for multiple systems. And that was the,  Genesis of it. And then to show you how these things grow, this is kind of a funny story. we're sort of doing it on an ad hoc basis as business came in or the need arose.

And we would serve the need, but then this guy from BlackRock and they had a big portfolio that was being managed by a large company. I think it was equity at the time. And I'm like, I came into a lobby and he said, What the F you know, I can't, my cell phone isn't working. how can we not have wifi?

We need wifi in every F in one of these buildings. And everybody was with was like, Oh, uh, uh, yeah. Okay. So, 35, 40 buildings later, we'd done lobby wifi conference room wifi, just basically off of one guy's anger. And, that was really a launching point for the, scale of it, because in that process, Pretty soon, very, very quickly.

You have to have a process for everything. And that's like the one thing. And probably, everyone on who's listening to this has to remember, like when it comes to commercial real estate, you have to have a process for everything. Our change management document is 68 pages. Wow. Yeah.

With flow charts.

James Dice: [00:18:14] Wow. Okay. so that was like the it side started first and then the OT side started after that. And is that the two sides of the business?

Joe Gaspardone: [00:18:23] Yeah. and that actually what you're really getting at is that there's a gap there.

Um, the it side really was leaving, uh, technology at the PMO office. And sometimes they had to delve in because there was no one to connect something and they'd start hanging stuff off the management network. Um, on the OT side, we all kind of know there's not a lot of. Tech experience or even interest on that side of the OT.

So there controls people and their, the walk, the building manage the systems kind of people hands-on. So there was this very clear gap that was happening. And that was kind of what we saw as the opportunity. We're going to go into this gap. We're going to make a building specific network, a dedicated building network.

That's an enterprise network. We're going to connect anything and everything over time that you want to connect, or that needs to be connected, route the data where it needs to go have systems, talk to each other, but make it a provisioning process. Off of the central network, that's only for building systems.

And so it took a little while you know, it kind of would go, wait, what's our role? And then you'd say, well, if you want to manage this, and it was like, you know, BMS, system, sensor, seismic detection, like leak detection. So you own it. It's your network. we don't own the network.

So, and they're like, ah, we don't, we don't have to have the staff for that. We can't reach into that. So that's kind of how that happens. So it's really the ITO two gap that we're directly kind of filling. And then making it a plug and play kind of situation where something new comes along, you say, great, you can connect it to the switch.

On 15, we open up port 22 and you know, we get, you're obviously get the, technical requirements from the vendor, but then it's running. So we kind of got everybody on board. It's like the, facilities managers, like that's awesome. And then the PMO is like, that's a great, and then the vendors, like this is the easiest one we've ever done.

So That was the goal.

James Dice: [00:20:25] Got it, got it. All right. Cool. So this is a huge part of the nexus foundations course that we're teaching right now. And. part of this is like translating all the different buzzwords around this concept. So can you kind of take us through, so we have like an enterprise network, you said there's like a base building network.

Some people call it there's, um, IP convergence. Can you kind of do the one-on-one aspect of this as well? Like what do you tell people that are new to this

Joe Gaspardone: [00:20:50] really? It's really good. I, you know, when things are developing in an industry, you do, you have this confusion.

And so some people will call it a converged network or a base building network. I like base building network cause it kind of implies dedication, a dedicated network for a purpose. and you've you really get a diverse array of. systems that get hung on it. And people often ask us, well, how does that help us with a smart building?

And the answer is the enterprise class nature. Means something it's not just a buzz word. It means change management. It means an SLA with 99.99, 9% uptime. It means things like locked cabinets with codes that you really can't access unless you get a code from us to get in there. So we're tracking every movement in the building as it pertains to any change as it pertains to the, uh, the building network.

And then. The answer to back to the customer, the client is. it's up to you. Do you want destination dispatch? Do you want access control talking to the elevator? Do you want that connected a third way to the BMS and heating up, an area of the building? So our, uh, approach to that is, as you can imagine, totally agnostic.

We're always happy to like tell people what works, what we've seen work and what we've seen, stumble or have problems. But we don't care if you're going to push every piece of data. From the BMS to the occupancy sensors, to the health scanner, to the, the lighting control to the cloud and normalize in the database.

Great. We'll make sure it all gets there that's the, those are the quotes I can see week after, week on your podcast. It's people saying things like, well, we'd like to go back up and scrape something from the cloud and perform an action, but you know, you can't count on the connectivity and it's like, yes.

you can count. You can, it's redundancy. You know, there's a lot of things around redundancy. So you've got like the way you architect and network. if you don't know what you're doing, Daisy chain, it. And if you do know what you're doing, you run separate fiber to each switch, and then you even can do a little fancy thing at the end to create a loop and get even more than NC.

But there are ways to architect enterprise networks. uh, another big one is redundancy of bandwidth. You don't just pick Comcast and at and T. You'll look and analyze where the pathways are. They diverse pathways. Do they come into the building in different locations? Those things can matter some day.

And you want to make sure that you've analyzed all of that when you're, setting these up. So it's a very. deep and enterprise class networking is really something that We're leveraging a bunch of our experience in building out fiber networks for, ISP and things like that.

But you know, what it comes down to is. If you go to like a Microsoft campus, they're going to be a lot closer to an enterprise network then your average building.

James Dice: [00:23:50] Got it. Okay. And is this a brownfield thing or just Greenfield? Like how's that happening on projects today?

Joe Gaspardone: [00:23:57] Yeah, so, I'd say 90% now of what we do is a brownfield or retrofit.

because there's usually a need, that's triggering it in the building. They're connecting something and that's triggering the need for a network. And then you go in and you say, you know, here's what we can do within your budget. And here's what you can put into 2020. Our goal is to give a path, right.

And anybody's would be here's your path. Here's what's most urgent. here's what you can do at next year. If budget allows, et cetera, et cetera. So 90% of it's there. The other 10% is, really just, because we're coming out of a, market that's existing buildings. So we're naturally going to have an overweight on that.

But now. once you sort of make your way through certain companies, they're bringing you in at the beginning as this building's coming out of the ground. And that's the really interesting part because you're seeing designs that were five years old that have like, just, it's a total disconnect between there are 15 systems that need networks.

And we designed this for a BMS network. So that disconnect, that gap is another one where we're going right in and saying, Hey, look, we can wipe. that problem off the table. We're going to build this. You're going to connect everything to that. And then you're going to have an SLA on top of it.

So that really is the future. Whether, it's, you know, us or somebody like us doing that, whether it's a BMS company that figures out, Hey, this needs to be more neutral and agnostic, but we need to have this. It's just that today, a lot of those companies, we work with them all the time and they would be the first to tell you, we don't have a networking background.

So we just don't really know how to do that.

James Dice: [00:25:38] Right, right. I

Joe Gaspardone: [00:25:39] hear that a lot. Yeah.

James Dice: [00:25:41] So talked to me at some point in the last couple of weeks around all the different types of systems you're seeing get connected to buildings these days. So you said there's something like 30. So can you kind of walk through like what you're seeing, because as you know, a lot of this audience comes from the sort of HVAC.

maybe a little lighting, little energy management perspective, and they might not realize the number of systems that are getting connected. I

Joe Gaspardone: [00:26:05] think that's a surprise for, um, almost everybody we talked to, who's not living it. And that's one of the reasons I love this podcast is because. a lot of the discussions are around, you know, the BMS naturally, because that's the ultimate start point for providing value in technology.

But you're sort of looking at these things, an, a silo, which is exactly what it's not anymore. And so you've got things like. I mean, obvious ones, security cameras, everywhere, wifi networks everywhere. Then you've got a lot of things we're seeing now, health scanners, temperature, sensors, occupancy sensors, these things may or may not touch the, BMS.

They just need to be. Passing data somewhere. So there's that. And you've got things like key management and you've got digital signage is a big one. All of these need network connections,  the cameras and the signage and elevators need connections. You've got fitness equipment is one of the like big ones happening right now.

All of the Peleton world has created this massive connectivity requirement. And while we would love all 20 of those bikes to like be connected to the BMS and like crank up the AC when the, you know, it's getting stuffy in there. That's just not, that's not where we are, but they still need connections.

so there's just lots of things like that. And then, leak detection has become one of the ones we're seeing just go right through the country because, there is an ROI there. They basically get an insurance discount by installing it, in a certain way, at a certain level. So, um, so you're seeing people take advantage of that ROI.

And just start putting link detection and all over the country. then some of the more esoteric ones, which even me is we've got a dozen or more installed, um, are connected like trash compactors. There are these sensors now that have to tell people when it's getting full and when it needs to be changed and they're billing, uh, some billing associated with that.

Just water treatment irrigation. Like everything needs an IP address now. So you're either stuck reinventing the wheel each time, or you've got to connect it to some centralized, monitored, place. and you know, that's the message, like, don't forget BMS people.

There's like this burgeoning giant, in parallel connectivity issue that's happening. right. At the same time, you know, these these things are all we're doing this every day. at scale now within hundreds of buildings. So it's right. And,

James Dice: [00:28:31] and this is one of the things where I, I feel like we haven't started to, like you said, a lot of times we're pulling data out of the building and we're using it to do one or two things and.

That data is usually then being used by one or two people. But I feel like we haven't quite gotten as like a nexus nerd community. We haven't quite wrapped our heads around all the different possibilities that like once you connect all these systems together, so like advanced supervisor control as an example,  we've been talking about it.

But, you know, we talked about the last member gathering. I've been writing essays for months. I think a lot of our imagination around that is just let's control the HVAC better. Maybe we can add lights into the HVAC control sequences and coordinate them. But really, I think what we're talking about is like, what if you're able to, you know, Enable this next use case.

And

Joe Gaspardone: [00:29:23] what, if you can take the trash

James Dice: [00:29:24] compactor data and, , send that to the billing system and the billing system can trigger some other, you know, I, I feel like we haven't even begun to really catalog and sort of narrow in, on maybe like a hierarchy of use cases. Like You connect these systems and now you've enabled these use cases. You connect these systems and now you've been able, you know, we haven't quite got there. And so that's one of the places that I would like to take these conversations more. So I appreciate you for bringing,

Joe Gaspardone: [00:29:51] well, you bring up a good point because,  I think, this community is starting in the right place.

All of the discussions in podcasts about normalizing data, tagging data standardization. That is the first and foremost requirement. And you're starting at the right place where most of this needs to start, which is really with the BMS, because you're going to get the most value immediately on ROI.

And that's what this industry values. So totally. A grade like that has to be done first. And those conventions have to be established and in place. And nice thing is once that's happened and it's going to take a long time, it is, but I mean, people are making really significant progress the, you know, a tease and tell nations, they get it.

And that's happening when that gets. Big enough and standard enough, then you're going to see the ability for building to now tag and pass, you know, air quality data tag, and pass leak detection, data tag, and pass metering or anything else. Digital signage. there's sort of a vast universe out there.

Seismic detection out here in California, you know, that's a huge, that's a big one. So the fact that is once you've got the center piece worked out, you can then incrementally add these things and then you really do have some power. you really can start doing fancy things.

James Dice: [00:31:15] Cool. So let's talk about the savings from this concept real quick.

So. I think the capital like the renovation or a new build savings are pretty straightforward to me. You know, you're reducing hardware, you're reducing potentially, service contracts from, you know, people being able to manage the hardware and software that comes along with all this redundancy that you're getting rid of.

I'm a little bit more cloudy on the operation side. So when you think about like the operating costs of all of the siloed networks versus the operating costs of a converged network, like what do those numbers

Joe Gaspardone: [00:31:51] look like? you know, it's funny. coming from real estate. To me. That's what I throw out.

I know I went on my, my operational hat and I'm like, well, that goes in the soft cost bucket. Like when you tell me money at 30 cents more foot for this solution, I'm like, Oh, that goes over here. so we really try to stay away from. The, labor savings. We, we actually try to let the solution speak for itself and let people see that because trying to quantify it, even if we really did it and did a really good job of it.

It's not believable to the people who are making decisions. It's just sort of like another stat that somebody is throwing at me that I can't prove. And so we've always tried to stick with like and we're very much this way. Like that's in bolts. Of savings. So the ones that everybody understands are like this, um, you've got eight circuits in your building and they're running eight different things.

They're running this sliding control and they're running this BMS and they're running. We're going to take those eight and learning have two. And those two are going to be full throttle. Redundant, you know, high availability. We're going to give you two firewalls and those are going to be configured and high availability and, with all of the bells and whistles that you'd kind of expect.

And now we're going to take that. So those other six circuits, which are 300 bucks a pop, and we're gonna pass that right back to you. So all of a sudden you've got $1,800 a month that you didn't have that you now have. So can you pay us that 1800 to manage the network yet you can't. We're going to be a lot of times you're coming in on a new solution.

And so the network

James Dice: [00:33:31] or

Joe Gaspardone: [00:33:31] whatever. Yeah. And, and the, the building system has got a network cost, and it's like, you can take that out, put this in. And then every single new solution that you ever put in this building has a zero network cost so they get that, that directly translates. And then the only one that's sort of longer term is there is a.

Big, especially with buildings that are 50 stories, 60 stories, there's a big cabling cost savings because when you have architected this network, you're connecting to the nearest switch. You're not running fiber again, all the way to the MPO. That's 30 grand or 30, five grand and all the other costs associated.

So, so, and then we just started quantifying this recently. But there's an energy savings because you're not running eight networks, you're running one network. So you've got the equipment, energy, get some body

James Dice: [00:34:25] dingy of all of that material.

Joe Gaspardone: [00:34:28] Yeah. Yep. so those are the ones we kind of stick with facilities manager, uh, the chief engineer, they love it.

I mean, they do once they realize, Oh, I just tell them we're doing this on this floor and it can get connected, but to try to say, Oh, we're saving the billing money. I mean, the reality is that guy's still there with his salary. So he may be saving hours and he may be doing something else with those hours.

But, we always try to stay away from that a little bit because. it's like one of those unprovable metrics.

James Dice: [00:34:57] Totally.

Joe Gaspardone: [00:34:58] Yeah.

James Dice: [00:34:59] Interesting. Okay, cool. So I want to talk about a couple, things as we kind of close out this episode. So what have you seen, as far as client stories  When people try to create a smart building without starting at this step, what have you seen happen versus what have you seen happen when you start here first and then use this step to enable a smart building?

Joe Gaspardone: [00:35:21] the biggest thing that happens is, you know, can you connect access, control the elevator and the, BMS in and make those functionally work together?

Yes.  a month later, can somebody be doing a T on the seventh floor, go in, eat a power outlet, unplugged the outlet to plug in his power tool and then take down,  every floor above you and have the whole thing shut down and have, you know, Yes, yes. That really truly happens.

so, that's the, you know, when you talk, not enterprise, not enterprise. That's, you know, when you say there's a process for everything, that's a great example of Something that really happens, um, does a chief engineer, get you know, some type of new device and a need to plug it in.

And he just walks into the riser. And he walks up to the switch and he plugs one in here and he plugs, Oh yeah, it's working well, yes, But you're working on a flat network with something else that's working and it's not long before these two things clash. So, that again, that's like, what would you do in the enterprise where it will, nothing works on the port level until you provision it.

But these things are just getting thrown in and they work for awhile. but then there's a power outage. It takes everything out. Cause there's no ups and then they have to reboot everything and something doesn't come up on the seventh floor and nobody's knows what to do. Cause there's nobody involved with any kind of network experience.

That's reality I can say for most buildings today. So, um, it's a  real problem and , I bet people listening right now are going to go. That's a great idea. Let's get into that business. So we welcome it because, you know, somebody needs to jump in as well.

James Dice: [00:37:02] Yeah. Yeah. You've mentioned something that I want to just key in on before we close out. So you talked about connecting the BMS and the elevator and access control. something I'm seeing as an issue here is we often think about that as like. Let's do that and sort of a one off way, because we only have a couple of systems in the building.

Right. Or we used to only have a couple of connected systems in the building. So let's just sort of in a one off way, connect these three things together enable this, you know, one or two use cases. But what I'm seeing as like that mindset is limiting when you have 30 systems connected.

Joe Gaspardone: [00:37:38] Right.

James Dice: [00:37:39] So I guess my question leads into, is there some sort of software layer needed here to manage all these connections?

And I guess part three of the question is like, who manages the naming and the data model and how all these systems are passing data. To one another and like the semantic aspect of this.

Joe Gaspardone: [00:38:00] Yes. It's such a good question. it's ugly. It's the answer. It's not in place right now. I mean, the truth is, is that even when we connect things centrally.

Whether they're centrally connected or not. A lot of this is still going to a single, location for a single purpose. Very rare. I mean, I can't, I honestly, less than a handful of, let's call it, you know, 300, 350 buildings, less than a handful are really integrating. I don't have any meaning that way.

And, the truth is, I mean, this comes back to this and we'll talk about it someday, but it's like, Every dollar that these people are spending on a recurring basis is worth 15 to $20. So a $10,000 solution, a $10,000 a month. The solution is not that to them,  because it's impacting value.

And so that 10,000, which is 120,000, you have to then multiply that by 15. And all of a sudden you're at two and a half million dollars. something that you're in your mind is thinking, Hey, this is $10,000 a month. The cost sensitivity is preventing a more holistic approach to this. And so

you know, you can present the full picture, but it very quickly gets ratcheted down too. I only need this for this purpose. That is, you know, world you've got campuses and college campuses and Microsoft campuses, those things, they don't have that cost sensitivity the same way.

But when you talk about the mass market and getting into the mass market, you're talking about cost sensitivity. That is. Unlike any other industry, because there's an exponential value attached to it. And so that's the big nut that we have to crack as a community, is finding ways to message that and work our way in because once you're in different world, you're part of the budget.

You're part of the cost structure. And now they're looking at other ways to grow revenue, but getting in is very, very difficult. that's the tough one. And

James Dice: [00:40:05] that is a great teaser into the next episode with Joe. So if you don't know what he's talking about, tune into the next one, and we'll, we'll take you through CRE finance one-on-one thanks, Joe, for this intro to converge networks, building level networks, base building networks, all the, uh, the buzzwords around, what sounds like a great opportunity for a lot of balloons out there.

So thanks for coming on the show.

Alright, friends. Thanks for listening to this episode of the Nexus podcast. For more episodes like this and to get the weekly Nexus newsletter, please subscribe at nexus.substack.com. You can find the show notes for this conversation there as well. As always, please reach out on LinkedIn with any thoughts on this episode.

I'd love to hear from you. Have a great day

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Happy Thursday!

Welcome to this week’s deep dive exclusively for Nexus Pro members. It’s an honor to have you here. This deep dive is a follow up to my recent podcast conversation with Joe Gaspardone, COO at Montgomery Technologies. I learned a lot from this conversation and want to share my takeaways and the full transcript with you below.

In case you missed it in your inbox, you can find the audio or video here:

Nexus site | Apple Podcasts | Spotify | YouTube | Add to other podcast apps

Enjoy!

—James


Outline

  • My reaction, including highlights
  • Full transcript

My reaction

First of all, Joe’s energy and enthusiasm are very contagious, right?! Love that optimism!

I don’t know about you, but it was beneficial for me to have Joe explain what a base building network actually is and cut through the buzzwords. It means: change management, SLA with 99.99% uptime, locked cabinets with codes, redundancy, etc.

I also loved Joe’s commentary on how a lot of the network issues we’ve talked about on previous podcasts are simply symptoms of not having this in place. We “can’t count on the connectivity”, for remote advanced supervisory control for example, because the BMS vendor built it and has no idea what they’re doing and no one is managing it.

The use case library I mentioned is something I truly might build out. If I connect to these silos, what does that enable? Have you seen anything like this before?

It was interesting to hear Joe’s answer to my last question. Less than a handful of the buildings he’s seen are integrating systems together with any sort of common data model for the building. They’re all 1-1, sort of bespoke connections between each system. “It’s ugly”, he said. And the owner’s perspective he provided is just as interesting: “I only need this for this purpose”.

My highlights:

  • Joe looks back at the evolution of technology in commercial real estate, and offers what his experience tells him is THE answer to James’ favorite question (6:37)
  • What is riser management? (13:29)
  • Translating the buzzwords: enterprise network, base building network, IP convergence (20:32)
  • A taste of the breadth of systems getting connected to buildings these days (25:41)
  • And what you can save by connecting them with a converged network (31:16)
  • Examples from the field of the importance of starting with connectivity to enable a smart building (35:05)

Full transcript

Note: transcript was created using an imperfect machine learning tool and lightly edited by a human (so you can get the gist). Please forgive errors!

James Dice: [00:00:00] Hello, friends. Welcome to Nexus, a smart buildings technology podcast for smart humans. I'm your host, James Dice. If we haven't met before, I write a weekly newsletter on the same topic. It's also called Nexus. Each week I share what I've learned, my opinions, and what I'm excited about in the quickly evolving world of intelligent buildings. Readers have called Nexus the best way to stay up to date on the future of this industry without all the marketing fluff. You can check it out and subscribe at nexus.substack.com or click the link in the show notes.

Since starting the Nexus newsletter, many of you have reached out to me wanting to talk shop, and we have. After a few weeks of those wonderful conversations, I realized I needed to record and share them with our growing community. So here we are. The Nexus podcast is born. This is our chance to explore and learn with the brightest in our industry together.

Episode 27 is a conversation with Joe Gaspar, Doni,  of Montgomery technologies out of California, and someone who has a unique background in both the commercial real estate and technology. Joe gave his answer to my favorite question and talked about how the base building or enterprise building network enables smart building technology and what can happen when that enabling step is skipped. This is a great primer for those of us in the nexus audience who know the smart building resolves around the connectivity of the building automation system but are just beginning to wrap our heads around what happens when all the other types of things in the building start coming online

This episode of the podcast is brought to you by nexus pro nexus pro is an annual or monthly subscription where members get exclusive writing podcasts and an invite to a monthly members only event.

You can find info on how to join and support the podcast@nexusdotsubstack.com. This episode is also brought to you by nexus foundations, an introductory course on smart buildings. If you're new to the industry, this course is for you. If you're an industry vet, but want to understand how technology is changing things.

This course is also for you. Cohort two is set to kick off in winter 2021, and you can enroll@courses.nexus labs.online without further ado, please enjoy this episode of the nexus podcast.

All right. Hello, Joe. Welcome to the show. Welcome to the nexus podcast. Thank you for coming on. Can you start by introducing yourself

Joe Gaspardone: [00:02:32] for us? Joe Gasper, doing COO of Montgomery technologies. Montgomery is a riser manager and secure network provider. So two divisions, one company.

James Dice: [00:02:44] Cool. And we're going to dive into what all of that means. Can you start though, but telling us how you got here. So, and then you have a history in real estate. So tell us about your career history.

Joe Gaspardone: [00:02:55] A long and winding road. Um, came out of college, went to work for, uh, equity, property management bank.

Property management company. did some acquisition disposition work, got my brokers license and I, I started my own, real estate company,  syndicating deals.  when you're growing a, a real estate company, you basically are doing everything. I was involved with finance, you know, contracts you, name it in the, sort of path of, for growing a business.

, I was doing it and then we got to a point where.  the software needs were, we're just not meeting. What we needed to grow. And,  that led to founding a software company, long story there, but we founded an enterprise property management software company,  started that in like 95 or 96, saw that.com boom and bust go right through what we were doing, which was, was actually software.

It was like client server software , exited that in 2001,  sold it to a larger, management software company.  but not before we'd signed up our first two REITs. So we really got all the way through the, the system and the scale of growing that software company went back to commercial real estate in 2001.

And then, Greg Jones, the president of Montgomery's a good friend of mine. And I helped him found it and sort of acted as an advisor over the years. And so fast forward, 15 years. And I come in as the COO and, uh, the last four years it's just been an awesome ride. It's been growing. Both sides of the business, riser management and intelligent riser, which is the secure network piece.

And watching these divisions develop and mature people, you know, it takes a year to get really effective in your role in this business. So, yeah. Watching that mature over time and people now have three and four years experience just being able to go out and do it. So it's a, strange combination.

I really do sometimes feel like a unicorn of like, hardcore operational experience and a pretty deep technology experience. So it's been a, it's been a great ride though. You don't, you don't get that opportunity very often.

James Dice: [00:05:05] That's amazing. Cool. Thanks for taking us through that. also stumbled across a wine app on Google. Is that you?

Joe Gaspardone: [00:05:14] Yeah. Yeah. That's me. You know, when a 2008 hit, we were sitting in the middle of this giant recession and we had prepared for it. we were fortunate to have somebody who is up. Commercial real estate appraisers part of our group. So we were a little bit like the Canary in the coal mine, and we could see a lot of that coming and we restructured leases.

We retrenched. So we actually came through it pretty intact. I mean, nobody was perfectly intact, but we, we came out of it in pretty good shape, but there were like two or three years where you'd show up for work. And there was was literally nothing to do. The markets were frozen.

no transactional stuff, no finance, nothing. You're just sitting on what existed. So this guy, and I decided now we're going to, follow our passion for awhile. We have six hours a day. Why don't we go down that road? So we created this, wine app and, um, wine channel. Um, and actually today it's still the most watched wine channel on YouTube.

If you Google, how to pronounce governor's demeanor. I come up before the definition, which is really embarrassing. No problem. I was just looking for

James Dice: [00:06:19] a headshot for you and I came across. Yeah. I came across a bunch of stuff. So,

Joe Gaspardone: [00:06:25] um, employees, get a great kick out of that. And as you can imagine, I, I see memes of myself, which is really annoying.

That's awesome.

James Dice: [00:06:33] That's awesome. Well, cool. Let's jump from there into today's topic. So as I usually do, I want to start with my favorite question. I know you're excited about this. So from your perspective, why is technology in the average building, uh, decades behind, other technology and other industries?

Joe Gaspardone: [00:06:51] Well, first of all, thank you. Because this has been like a splinter in my brain for months. and there, people are giving great answers, by the way, like they, they really do. They come up with things and like, yeah, I actually hadn't thought about it that way. But the thing I think that's missing is so many answers, the real answer is rooted in history and it's one that I lived. And so  I know it's the answer and the answer is. In 1990. In 1993 in 1994, people were using dos software. That was technology technology in commercial real estate. It was like a non-existent thing that BMS was not even considered technology.

It was considered like a refrigerator or a toaster. it wasn't technology that were things that were killing it. And it had like a serial connection to make it work. So it it didn't really qualify. Hm. And the people in commercial real estate, the founder, you know, Sam Zell, founder of equity, that guy is a salt of the earth guy and take him ledgers paper ledgers didn't make mistakes.

You could go there. You never lose it. Technology was like a roll, the dice risky proposition. So. If something worked and it was on dos, it stayed on to us through the eighties. It went all the way into the mid nineties. They're very, very slow because technology to real estate is a cost and the ROI behind it.

Was not provable. And so if you couldn't prove it, you didn't use it. So there were no CTOs. And then, you know, mid nineties that wasn't even a thing. And the first CTOs were like the weakest position in the entire organization. They just had no ability to move the ball or get anything done. So the, true answer is yes.

That technology was basically dos software, which everybody hated and nobody would come into the market. Well, you can imagine if there's no value seen to technology, then people will not develop anything in a market where they don't value it. They don't want it. So that's, that was the reality sort of aware things were.

They need kind of had incremental progress in software, but guess what happened? the.com bust. So you had people trying to develop property management software and cold fusion back then. And, these things were just wild crash and burns. And the people who tried to jump on just got, crushed by that.

And they, you know, many of them lost their jobs because it was, it was just not ready for, the enterprise level use. And the budgets weren't there to really, you know, nobody was going to pay $900,000 a year to subscribe or to pay for, online property management software. So you have this, fundamental.

Difference of, perspective where the people who ran the companies. So our technology is a risk and a cost. And then you had the markets saying, well, I'm not, going to go on in that market and develop anything technological. Cause I can't get enough uptake. And between that and the.com bust.

We just now, I mean, like, this is the beginning of finally recovering from that long cycle of where people could actually prove an ROI. Can actually show some benefits, some gain so we're just now coming out of that and it's just, you know, it's really at the national stage.  that's just  where we are as sad as that is because we're so far behind.

James Dice: [00:10:25] Yeah. Yeah. And, just like, I'm looking backwards. So you just like, caught me up from a lot of the history that happened when I was, you know, before I was 10 years old, but What I'm seeing now

Joe Gaspardone: [00:10:36] is there are a

James Dice: [00:10:36] lot of these and we're going to the real conference this week. There are a lot of real estate organizations that are participating in that and they have these CTOs.

I think one of the people on the panel that I interviewed yesterday was, uh, chief technology and innovation officer of a very large REIT. So how do you feel, what do you think has changed within these organizations like why, if they added these new roles and new perspectives?

Joe Gaspardone: [00:11:00] The biggest reason is, um, you couldn't avoid it.

It was like you know, you're standing in the street and here comes the truck or the train. And you really, there was no way around it. Eventually every new system, every new device had to have some connectivity. Property management offices really, really needed to be connected back to the central office.

Um, so, you just couldn't avoid it. And it started with the PMOs coming back to the corporate. And then, now we're just like at the beginning of this wave of connected devices in the buildings, things that people don't even think of. And so you have to have somebody at the top now to manage and organize and at least start to create.

Sort of plans, operational plans, rollout plans, things like that. a lot of them are still very weak and they don't have a lot of budget to work with, but they are now able to give like the stamp of approval on things that can actually help move the ball forward, on the sort of local building by bullying.

James Dice: [00:12:02] I'm picturing like general technology sort of like dragging along, the real estate organizations versus what you would think would be happening as an organization says, how can we use technology to strategically, you know, help our business?

Joe Gaspardone: [00:12:16] What

James Dice: [00:12:17] I'm picturing, you just described as like this, like dragging.

Into the future.

Joe Gaspardone: [00:12:22] I hate,  it. It's like I've lived it for so long and it just, it's an awful thing about this industry, but it's just the truth and it's really the historical truth. And that, that's why we're sort of where we are today. But I mean, the good news is, is you really, can look forward.

Like they're meaningful dollars going into technology. Now a lot of companies are starting in the right place and a lot are starting the wrong place in my opinion. But there are enough that are moving things forward with talent. You know, your nexus is a great example of that.

You know, you've got hundreds of people who really are the smart cream of the crop, people that are, an audience now and networking with each other. And that, is the beginning of the future. So, I mean, everybody who's here. Can see with some optimism, what we, have to look forward to so that you know, you don't have to experience the pain in the past.

Just look forward.

James Dice: [00:13:14] Know there you go. Yeah. So for all of you listeners out there, Joe thinks a whole hell of a lot of all of you, so he's excited to meet you. So,

let's talk about Montgomery real quick. So you mentioned the two sides of the business. Can you go into a little bit more detail on each side?

Joe Gaspardone: [00:13:29] Sure. So, Montgomery was founded 18 years ago, as a riser management company and rise riser management. A lot of people aren't, aren't exactly familiar with what that means, but it basically came out of when the phone companies got deregulated, they basically handed back ownership of all of the internal copper infrastructure to the buildings and said, all right, this is on you.

You handle that. We're not touching it anymore. w

James Dice: [00:13:53] when was that?

Joe Gaspardone: [00:13:54] That was, uh, just early two thousands, 2002 or 2001 right in there. Okay. And so that happened in these, you know, ATT was a regional bell there, all these baby bells, and they basically all at once.

It became deregulated and handed back this infrastructure. Now the buildings sitting on this going well, new tenants moving in, like, what do I do? And the answer became for a lot of markets, riser management. We will. Manage that infrastructure, the vertical cabling. And then we'll make sure that, you know, the two copper pairs get connected to the right, vertical PAs and they get extended to the tenant.

So that was the primitive beginning of all that, but what came out of that also was, sort of a highly evolved. Access screening process to make sure that not just anyone could get into those places because you know, the guy, if at and T got in there, they would want to do that as fast as possible, as cheaply as possible.

And they might take down somebody else. So there was a lot of the. The access restriction became a really, sort of piece of that. And that fast forward 18 years has grown into the fiber side networking side. And, that is, you know, that's sensitivity times a hundred because you have everybody's everything running through that riser.

Now you have all of everybody's cloud access, you know, high speed, transactional. you know, stock market related stuff, like you really have full business operations running through that, riser. So that, has, sort of expanded and grown over time because people realize, Hey, we need some management control over this.

And there's a real, surprisingly deep process. To the screening insurance, you know, whose gets access to what, under what circumstances, very, very specific, and then documenting all that, you know, what's there and making sure it's done to code under the building standard. There's, you know, there's a sort of a lot under the hood when it comes to riser management.

So that's that side of the business. And

James Dice: [00:16:01] where does the OT stuff come into that equation?

Joe Gaspardone: [00:16:06] Yeah. So you've got. what I call I call it the old business, the new business and the sort of OT side about 10 years ago, Greg really. Uh, this coming, it was doing some work for, for NATO and some other, large real estate players Shorenstein and they were starting to sub meter and add these meters and he said, meters needed a way to be connected.

And he kinda had a light bulb moment and saw, you know what, this is where everything is going to have to be. At some point down the road. And so right then, and it literally was like a full 10 years ago. we started doing the work of connecting these things and cabling them. But within a year or two, we decided, Hey, nobody's got a way of ensuring these things are up and running.

That there's a, network. Nobody has a network experience at all. So we started to build the first networks that could be leveraged for multiple systems. And that was the,  Genesis of it. And then to show you how these things grow, this is kind of a funny story. we're sort of doing it on an ad hoc basis as business came in or the need arose.

And we would serve the need, but then this guy from BlackRock and they had a big portfolio that was being managed by a large company. I think it was equity at the time. And I'm like, I came into a lobby and he said, What the F you know, I can't, my cell phone isn't working. how can we not have wifi?

We need wifi in every F in one of these buildings. And everybody was with was like, Oh, uh, uh, yeah. Okay. So, 35, 40 buildings later, we'd done lobby wifi conference room wifi, just basically off of one guy's anger. And, that was really a launching point for the, scale of it, because in that process, Pretty soon, very, very quickly.

You have to have a process for everything. And that's like the one thing. And probably, everyone on who's listening to this has to remember, like when it comes to commercial real estate, you have to have a process for everything. Our change management document is 68 pages. Wow. Yeah.

With flow charts.

James Dice: [00:18:14] Wow. Okay. so that was like the it side started first and then the OT side started after that. And is that the two sides of the business?

Joe Gaspardone: [00:18:23] Yeah. and that actually what you're really getting at is that there's a gap there.

Um, the it side really was leaving, uh, technology at the PMO office. And sometimes they had to delve in because there was no one to connect something and they'd start hanging stuff off the management network. Um, on the OT side, we all kind of know there's not a lot of. Tech experience or even interest on that side of the OT.

So there controls people and their, the walk, the building manage the systems kind of people hands-on. So there was this very clear gap that was happening. And that was kind of what we saw as the opportunity. We're going to go into this gap. We're going to make a building specific network, a dedicated building network.

That's an enterprise network. We're going to connect anything and everything over time that you want to connect, or that needs to be connected, route the data where it needs to go have systems, talk to each other, but make it a provisioning process. Off of the central network, that's only for building systems.

And so it took a little while you know, it kind of would go, wait, what's our role? And then you'd say, well, if you want to manage this, and it was like, you know, BMS, system, sensor, seismic detection, like leak detection. So you own it. It's your network. we don't own the network.

So, and they're like, ah, we don't, we don't have to have the staff for that. We can't reach into that. So that's kind of how that happens. So it's really the ITO two gap that we're directly kind of filling. And then making it a plug and play kind of situation where something new comes along, you say, great, you can connect it to the switch.

On 15, we open up port 22 and you know, we get, you're obviously get the, technical requirements from the vendor, but then it's running. So we kind of got everybody on board. It's like the, facilities managers, like that's awesome. And then the PMO is like, that's a great, and then the vendors, like this is the easiest one we've ever done.

So That was the goal.

James Dice: [00:20:25] Got it, got it. All right. Cool. So this is a huge part of the nexus foundations course that we're teaching right now. And. part of this is like translating all the different buzzwords around this concept. So can you kind of take us through, so we have like an enterprise network, you said there's like a base building network.

Some people call it there's, um, IP convergence. Can you kind of do the one-on-one aspect of this as well? Like what do you tell people that are new to this

Joe Gaspardone: [00:20:50] really? It's really good. I, you know, when things are developing in an industry, you do, you have this confusion.

And so some people will call it a converged network or a base building network. I like base building network cause it kind of implies dedication, a dedicated network for a purpose. and you've you really get a diverse array of. systems that get hung on it. And people often ask us, well, how does that help us with a smart building?

And the answer is the enterprise class nature. Means something it's not just a buzz word. It means change management. It means an SLA with 99.99, 9% uptime. It means things like locked cabinets with codes that you really can't access unless you get a code from us to get in there. So we're tracking every movement in the building as it pertains to any change as it pertains to the, uh, the building network.

And then. The answer to back to the customer, the client is. it's up to you. Do you want destination dispatch? Do you want access control talking to the elevator? Do you want that connected a third way to the BMS and heating up, an area of the building? So our, uh, approach to that is, as you can imagine, totally agnostic.

We're always happy to like tell people what works, what we've seen work and what we've seen, stumble or have problems. But we don't care if you're going to push every piece of data. From the BMS to the occupancy sensors, to the health scanner, to the, the lighting control to the cloud and normalize in the database.

Great. We'll make sure it all gets there that's the, those are the quotes I can see week after, week on your podcast. It's people saying things like, well, we'd like to go back up and scrape something from the cloud and perform an action, but you know, you can't count on the connectivity and it's like, yes.

you can count. You can, it's redundancy. You know, there's a lot of things around redundancy. So you've got like the way you architect and network. if you don't know what you're doing, Daisy chain, it. And if you do know what you're doing, you run separate fiber to each switch, and then you even can do a little fancy thing at the end to create a loop and get even more than NC.

But there are ways to architect enterprise networks. uh, another big one is redundancy of bandwidth. You don't just pick Comcast and at and T. You'll look and analyze where the pathways are. They diverse pathways. Do they come into the building in different locations? Those things can matter some day.

And you want to make sure that you've analyzed all of that when you're, setting these up. So it's a very. deep and enterprise class networking is really something that We're leveraging a bunch of our experience in building out fiber networks for, ISP and things like that.

But you know, what it comes down to is. If you go to like a Microsoft campus, they're going to be a lot closer to an enterprise network then your average building.

James Dice: [00:23:50] Got it. Okay. And is this a brownfield thing or just Greenfield? Like how's that happening on projects today?

Joe Gaspardone: [00:23:57] Yeah, so, I'd say 90% now of what we do is a brownfield or retrofit.

because there's usually a need, that's triggering it in the building. They're connecting something and that's triggering the need for a network. And then you go in and you say, you know, here's what we can do within your budget. And here's what you can put into 2020. Our goal is to give a path, right.

And anybody's would be here's your path. Here's what's most urgent. here's what you can do at next year. If budget allows, et cetera, et cetera. So 90% of it's there. The other 10% is, really just, because we're coming out of a, market that's existing buildings. So we're naturally going to have an overweight on that.

But now. once you sort of make your way through certain companies, they're bringing you in at the beginning as this building's coming out of the ground. And that's the really interesting part because you're seeing designs that were five years old that have like, just, it's a total disconnect between there are 15 systems that need networks.

And we designed this for a BMS network. So that disconnect, that gap is another one where we're going right in and saying, Hey, look, we can wipe. that problem off the table. We're going to build this. You're going to connect everything to that. And then you're going to have an SLA on top of it.

So that really is the future. Whether, it's, you know, us or somebody like us doing that, whether it's a BMS company that figures out, Hey, this needs to be more neutral and agnostic, but we need to have this. It's just that today, a lot of those companies, we work with them all the time and they would be the first to tell you, we don't have a networking background.

So we just don't really know how to do that.

James Dice: [00:25:38] Right, right. I

Joe Gaspardone: [00:25:39] hear that a lot. Yeah.

James Dice: [00:25:41] So talked to me at some point in the last couple of weeks around all the different types of systems you're seeing get connected to buildings these days. So you said there's something like 30. So can you kind of walk through like what you're seeing, because as you know, a lot of this audience comes from the sort of HVAC.

maybe a little lighting, little energy management perspective, and they might not realize the number of systems that are getting connected. I

Joe Gaspardone: [00:26:05] think that's a surprise for, um, almost everybody we talked to, who's not living it. And that's one of the reasons I love this podcast is because. a lot of the discussions are around, you know, the BMS naturally, because that's the ultimate start point for providing value in technology.

But you're sort of looking at these things, an, a silo, which is exactly what it's not anymore. And so you've got things like. I mean, obvious ones, security cameras, everywhere, wifi networks everywhere. Then you've got a lot of things we're seeing now, health scanners, temperature, sensors, occupancy sensors, these things may or may not touch the, BMS.

They just need to be. Passing data somewhere. So there's that. And you've got things like key management and you've got digital signage is a big one. All of these need network connections,  the cameras and the signage and elevators need connections. You've got fitness equipment is one of the like big ones happening right now.

All of the Peleton world has created this massive connectivity requirement. And while we would love all 20 of those bikes to like be connected to the BMS and like crank up the AC when the, you know, it's getting stuffy in there. That's just not, that's not where we are, but they still need connections.

so there's just lots of things like that. And then, leak detection has become one of the ones we're seeing just go right through the country because, there is an ROI there. They basically get an insurance discount by installing it, in a certain way, at a certain level. So, um, so you're seeing people take advantage of that ROI.

And just start putting link detection and all over the country. then some of the more esoteric ones, which even me is we've got a dozen or more installed, um, are connected like trash compactors. There are these sensors now that have to tell people when it's getting full and when it needs to be changed and they're billing, uh, some billing associated with that.

Just water treatment irrigation. Like everything needs an IP address now. So you're either stuck reinventing the wheel each time, or you've got to connect it to some centralized, monitored, place. and you know, that's the message, like, don't forget BMS people.

There's like this burgeoning giant, in parallel connectivity issue that's happening. right. At the same time, you know, these these things are all we're doing this every day. at scale now within hundreds of buildings. So it's right. And,

James Dice: [00:28:31] and this is one of the things where I, I feel like we haven't started to, like you said, a lot of times we're pulling data out of the building and we're using it to do one or two things and.

That data is usually then being used by one or two people. But I feel like we haven't quite gotten as like a nexus nerd community. We haven't quite wrapped our heads around all the different possibilities that like once you connect all these systems together, so like advanced supervisor control as an example,  we've been talking about it.

But, you know, we talked about the last member gathering. I've been writing essays for months. I think a lot of our imagination around that is just let's control the HVAC better. Maybe we can add lights into the HVAC control sequences and coordinate them. But really, I think what we're talking about is like, what if you're able to, you know, Enable this next use case.

And

Joe Gaspardone: [00:29:23] what, if you can take the trash

James Dice: [00:29:24] compactor data and, , send that to the billing system and the billing system can trigger some other, you know, I, I feel like we haven't even begun to really catalog and sort of narrow in, on maybe like a hierarchy of use cases. Like You connect these systems and now you've enabled these use cases. You connect these systems and now you've been able, you know, we haven't quite got there. And so that's one of the places that I would like to take these conversations more. So I appreciate you for bringing,

Joe Gaspardone: [00:29:51] well, you bring up a good point because,  I think, this community is starting in the right place.

All of the discussions in podcasts about normalizing data, tagging data standardization. That is the first and foremost requirement. And you're starting at the right place where most of this needs to start, which is really with the BMS, because you're going to get the most value immediately on ROI.

And that's what this industry values. So totally. A grade like that has to be done first. And those conventions have to be established and in place. And nice thing is once that's happened and it's going to take a long time, it is, but I mean, people are making really significant progress the, you know, a tease and tell nations, they get it.

And that's happening when that gets. Big enough and standard enough, then you're going to see the ability for building to now tag and pass, you know, air quality data tag, and pass leak detection, data tag, and pass metering or anything else. Digital signage. there's sort of a vast universe out there.

Seismic detection out here in California, you know, that's a huge, that's a big one. So the fact that is once you've got the center piece worked out, you can then incrementally add these things and then you really do have some power. you really can start doing fancy things.

James Dice: [00:31:15] Cool. So let's talk about the savings from this concept real quick.

So. I think the capital like the renovation or a new build savings are pretty straightforward to me. You know, you're reducing hardware, you're reducing potentially, service contracts from, you know, people being able to manage the hardware and software that comes along with all this redundancy that you're getting rid of.

I'm a little bit more cloudy on the operation side. So when you think about like the operating costs of all of the siloed networks versus the operating costs of a converged network, like what do those numbers

Joe Gaspardone: [00:31:51] look like? you know, it's funny. coming from real estate. To me. That's what I throw out.

I know I went on my, my operational hat and I'm like, well, that goes in the soft cost bucket. Like when you tell me money at 30 cents more foot for this solution, I'm like, Oh, that goes over here. so we really try to stay away from. The, labor savings. We, we actually try to let the solution speak for itself and let people see that because trying to quantify it, even if we really did it and did a really good job of it.

It's not believable to the people who are making decisions. It's just sort of like another stat that somebody is throwing at me that I can't prove. And so we've always tried to stick with like and we're very much this way. Like that's in bolts. Of savings. So the ones that everybody understands are like this, um, you've got eight circuits in your building and they're running eight different things.

They're running this sliding control and they're running this BMS and they're running. We're going to take those eight and learning have two. And those two are going to be full throttle. Redundant, you know, high availability. We're going to give you two firewalls and those are going to be configured and high availability and, with all of the bells and whistles that you'd kind of expect.

And now we're going to take that. So those other six circuits, which are 300 bucks a pop, and we're gonna pass that right back to you. So all of a sudden you've got $1,800 a month that you didn't have that you now have. So can you pay us that 1800 to manage the network yet you can't. We're going to be a lot of times you're coming in on a new solution.

And so the network

James Dice: [00:33:31] or

Joe Gaspardone: [00:33:31] whatever. Yeah. And, and the, the building system has got a network cost, and it's like, you can take that out, put this in. And then every single new solution that you ever put in this building has a zero network cost so they get that, that directly translates. And then the only one that's sort of longer term is there is a.

Big, especially with buildings that are 50 stories, 60 stories, there's a big cabling cost savings because when you have architected this network, you're connecting to the nearest switch. You're not running fiber again, all the way to the MPO. That's 30 grand or 30, five grand and all the other costs associated.

So, so, and then we just started quantifying this recently. But there's an energy savings because you're not running eight networks, you're running one network. So you've got the equipment, energy, get some body

James Dice: [00:34:25] dingy of all of that material.

Joe Gaspardone: [00:34:28] Yeah. Yep. so those are the ones we kind of stick with facilities manager, uh, the chief engineer, they love it.

I mean, they do once they realize, Oh, I just tell them we're doing this on this floor and it can get connected, but to try to say, Oh, we're saving the billing money. I mean, the reality is that guy's still there with his salary. So he may be saving hours and he may be doing something else with those hours.

But, we always try to stay away from that a little bit because. it's like one of those unprovable metrics.

James Dice: [00:34:57] Totally.

Joe Gaspardone: [00:34:58] Yeah.

James Dice: [00:34:59] Interesting. Okay, cool. So I want to talk about a couple, things as we kind of close out this episode. So what have you seen, as far as client stories  When people try to create a smart building without starting at this step, what have you seen happen versus what have you seen happen when you start here first and then use this step to enable a smart building?

Joe Gaspardone: [00:35:21] the biggest thing that happens is, you know, can you connect access, control the elevator and the, BMS in and make those functionally work together?

Yes.  a month later, can somebody be doing a T on the seventh floor, go in, eat a power outlet, unplugged the outlet to plug in his power tool and then take down,  every floor above you and have the whole thing shut down and have, you know, Yes, yes. That really truly happens.

so, that's the, you know, when you talk, not enterprise, not enterprise. That's, you know, when you say there's a process for everything, that's a great example of Something that really happens, um, does a chief engineer, get you know, some type of new device and a need to plug it in.

And he just walks into the riser. And he walks up to the switch and he plugs one in here and he plugs, Oh yeah, it's working well, yes, But you're working on a flat network with something else that's working and it's not long before these two things clash. So, that again, that's like, what would you do in the enterprise where it will, nothing works on the port level until you provision it.

But these things are just getting thrown in and they work for awhile. but then there's a power outage. It takes everything out. Cause there's no ups and then they have to reboot everything and something doesn't come up on the seventh floor and nobody's knows what to do. Cause there's nobody involved with any kind of network experience.

That's reality I can say for most buildings today. So, um, it's a  real problem and , I bet people listening right now are going to go. That's a great idea. Let's get into that business. So we welcome it because, you know, somebody needs to jump in as well.

James Dice: [00:37:02] Yeah. Yeah. You've mentioned something that I want to just key in on before we close out. So you talked about connecting the BMS and the elevator and access control. something I'm seeing as an issue here is we often think about that as like. Let's do that and sort of a one off way, because we only have a couple of systems in the building.

Right. Or we used to only have a couple of connected systems in the building. So let's just sort of in a one off way, connect these three things together enable this, you know, one or two use cases. But what I'm seeing as like that mindset is limiting when you have 30 systems connected.

Joe Gaspardone: [00:37:38] Right.

James Dice: [00:37:39] So I guess my question leads into, is there some sort of software layer needed here to manage all these connections?

And I guess part three of the question is like, who manages the naming and the data model and how all these systems are passing data. To one another and like the semantic aspect of this.

Joe Gaspardone: [00:38:00] Yes. It's such a good question. it's ugly. It's the answer. It's not in place right now. I mean, the truth is, is that even when we connect things centrally.

Whether they're centrally connected or not. A lot of this is still going to a single, location for a single purpose. Very rare. I mean, I can't, I honestly, less than a handful of, let's call it, you know, 300, 350 buildings, less than a handful are really integrating. I don't have any meaning that way.

And, the truth is, I mean, this comes back to this and we'll talk about it someday, but it's like, Every dollar that these people are spending on a recurring basis is worth 15 to $20. So a $10,000 solution, a $10,000 a month. The solution is not that to them,  because it's impacting value.

And so that 10,000, which is 120,000, you have to then multiply that by 15. And all of a sudden you're at two and a half million dollars. something that you're in your mind is thinking, Hey, this is $10,000 a month. The cost sensitivity is preventing a more holistic approach to this. And so

you know, you can present the full picture, but it very quickly gets ratcheted down too. I only need this for this purpose. That is, you know, world you've got campuses and college campuses and Microsoft campuses, those things, they don't have that cost sensitivity the same way.

But when you talk about the mass market and getting into the mass market, you're talking about cost sensitivity. That is. Unlike any other industry, because there's an exponential value attached to it. And so that's the big nut that we have to crack as a community, is finding ways to message that and work our way in because once you're in different world, you're part of the budget.

You're part of the cost structure. And now they're looking at other ways to grow revenue, but getting in is very, very difficult. that's the tough one. And

James Dice: [00:40:05] that is a great teaser into the next episode with Joe. So if you don't know what he's talking about, tune into the next one, and we'll, we'll take you through CRE finance one-on-one thanks, Joe, for this intro to converge networks, building level networks, base building networks, all the, uh, the buzzwords around, what sounds like a great opportunity for a lot of balloons out there.

So thanks for coming on the show.

Alright, friends. Thanks for listening to this episode of the Nexus podcast. For more episodes like this and to get the weekly Nexus newsletter, please subscribe at nexus.substack.com. You can find the show notes for this conversation there as well. As always, please reach out on LinkedIn with any thoughts on this episode.

I'd love to hear from you. Have a great day

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