The Innovators: Kastle Systems
In this series, Bisnow highlights people and companies pushing the commercial real estate industry forward in myriad ways. Click here to read Q&As with all the innovators Bisnow has interviewed so far.
Throughout the coronavirus pandemic, one of the most important questions in the business world, and especially in commercial real estate, has been: "When will employees return to the office?"
Kastle Systems has been at the forefront of answering that question.
The Falls Church, Virginia-based company, which manages access control for commercial properties, used data from its keycard entry systems to track the number of people entering office buildings across the country. It used this data to launch the Kastle Back to Work Barometer, a weekly metric of the percentage occupancy in office buildings across 10 major metropolitan areas.
The metric has been cited widely in news reports, and it is available on the Bloomberg Terminal, a leading platform used by Wall Street investors.
"It is the definitive source for how Americans are returning back to the office, which is a really important driver of our economy," Kastle Systems Chairman Mark Ein told Bisnow in an interview.
Kastle has also launched a platform aimed at addressing another key question in the commercial real estate industry: How can office owners bring people back into buildings safely?
The company launched KastleSafeSpaces, a platform that helps commercial property owners and managers ensure employees return to work safely. The platform built off Kastle's existing building access technology to provide health screenings for people entering the building, to allow people to enter without touching surfaces, to foster social distancing between occupants, to contact trace if an occupant tests positive for Covid-19 and to maximize a building's air quality.
The return to work has not occurred as quickly as many people expected at this time last year, as multiple resurgences of the coronavirus kept people hesitant to share enclosed spaces with others.
But Kastle Systems has provided a way to track the change in office occupancy every week, and it has provided a safe way for companies that are ready to return. And for those efforts, Kastle Systems is a Bisnow innovator.
This interview has been edited and condensed for clarity.
Bisnow: I wanted to talk first about the aspect of measuring the return to work. Kastle launched this Back to Work Barometer, which has aggregated data from properties in major cities across the country with Kastle access controls. So, looking back to the beginning of the pandemic when you launched this, what led you to do this? Why did you decide to launch this barometer?
Ein: So it’s actually an interesting story. We were meeting with one of our biggest customers, one of America’s largest property owners that we secure all of their commercial buildings, about hearing our thoughts early on in the Covid crisis about our framework for getting people back in the office. And one of the guys on our team had pulled the data for their portfolio, and the graph was so stark and made such a profound point that we decided to put it in the presentation for them. It ended up being a main part of the conversation we had with them when they saw how precipitous the actual occupancy had fallen.
And so that then got us thinking that we actually have the biggest repository of data of anyone in America about people being in the office in a single source, and thought it would be interesting. So we compiled it, all on a no-name basis just in the aggregate, we compiled it nationally and by market, and it’s proven to be the single-most-followed measure of the extent to which America has gone back to the office.
Bisnow: How valuable do you think this has been over the last year, compared to your expectations when you first decided to launch it? Did you think you would get the kind of response you have?
Ein: Everyone who builds something big says they knew it from the beginning, but I don’t think our team could say that we realized this would have the profound impact it has. It’s been cited in hundreds of news articles, it’s used in Wall Street research, it is available on the Bloomberg Terminal for people in the financial markets. It is the definitive source for how Americans are returning back to the office, which is a really important driver of our economy. And I’m really proud of the team for thinking of it and how we rolled it out, but I don’t think any of us could have realized how significant it could become.
Bisnow: So what have these reports done for Kastle as a company? Did they help generate business and revenue?
Ein: Our motivation in doing this was not to drive revenue. We really thought we have some very important data that’s useful to a lot of people, and we wanted to make it widely available. It has had a very strong spillover effect in getting Kastle’s name out there. Kastle already is a storied company in the real estate industry, but it’s increased our profile even more, just given how prominent the Kastle Back to Work Barometer has become.
Most importantly for us, it has led to a huge number of conversations with property owners about our KastleSafeSpaces framework, which is the set of protocols and technologies that we’ve developed to actually make office buildings safer for people to come back to work, and to make people in buildings feel safer. I think that in terms of our business that has been the most profound impact.
Bisnow: I do want to talk about the SafeSpaces framework, but I have one more question on the barometer. What does it tell you about where we are today in terms of office occupancy and what trends we can expect going forward?
Ein: So it has come up a meaningful amount from the bottom over the winter, but we’re still at the lower end of the range that any of us would hope for. My belief is that once vaccinations are widely available for people under 65, that’s going to be the catalyst to a huge number of people getting back to the office. While the pace of vaccinations has been terrific, it still is mainly only widely available to people over 65, which is not the bulk of the working-age population. And in the next month or two, once vaccinations are widely available to everyone, I think you’re going to see a huge increase in the number of people coming back to the office.
Bisnow: So you think this summer we could see a big bump?
Ein: I think it’s going to be huge. There’s widespread belief that the economy is going to explode once vaccinations are widely administered and people feel comfortable, and I think being back in the office is a big piece of that. And it’s a big piece of it because all the business leaders I’ve talked to are eager to get their teams back together in person. But also from the work we’ve done, employees at companies at this point would like to be back with their colleagues as well. So I think it’ll have a big impact on companies and what they can do once people are back in person.
And then there’s the secondary impact of people being back in the office is that today a lot of urban centers still feel a little bit like ghost towns in the middle of the day because there’s no one there, and that has an impact on the restaurants and the retailers in those places. So there’s a multiplier effect. Once you get people back in the office, then all of the sudden those establishments start to prosper again, and then they rehire people and employment goes up. There’s a huge multiplier effect for people being in office, both negatively from the pandemic, but I think you’ll see the reverse positively once people start to come back.
Bisnow: So you mentioned that you launched KastleSafeSpaces to help companies return to the office. What made you decide to launch this system? What was the initial strategy there?
Ein: Well, Kastle’s mission is to be the trusted adviser to commercial property owners and tenants in those buildings as it relates to protecting their property and the people in them. That’s what our job is. And historically for the last 50 years, that job has centered around protecting the property and people from physical threats: other people, natural disasters and those kinds of threats. But when the pandemic came, it was clear there was a new threat, which was Covid-19, and it was our job to take all of our ingenuity, our platforms, our technology and figure out how do we help building owners and tenants make their spaces safe so that people can get back to the office as quickly as possible and so people in the buildings can feel safe. We embraced this early on, we rolled it out early on, and we have spent a huge amount of time over the last year working with property owners to implement SafeSpaces in properties across the country.
Bisnow: What are the most important aspects of this program? What are the different ways that you enable the safe return to the office?
Ein: There are a number of principles behind SafeSpaces. The first is making sure that people who come in and out of buildings or spaces, to help buildings and companies know who is safe and who’s not. Meaning if someone has Covid that they can’t come into the office, and alternatively if someone has been vaccinated that they should be allowed to come back, and then everything in between. At the core of Kastle is the ability to authorize who can get into a given space or not. So we just added your Covid status as another criteria for whether you have access. That has been through a questionnaire asking about symptoms, but companies if they want can add testing status or vaccination status. And we do think that vaccination status will increasingly be criteria that buildings and tenants are going to want to use. So that’s one.
The second is to make as many surfaces touchless as possible, so the ability to call elevators from an app, the ability to open doors remotely, those kinds of things.
The third is trying to create space, so that’s helping people think about the actual office environment and how you want to spread people out. But it’s also scheduling people and visitors when they come to the office so not everyone is showing up at the exact same time and creating crowds. So that’s another important one.
Air quality is another one, we’re working on air monitoring, management and filtration systems. The last is contact tracing, so you know who is in the office and when, so if after the fact someone turns out that they had Covid, you can figure out who was in proximity to them in the office. In summary, it’s screening in and screening out, touchless everything, social distancing, contact tracing and air quality.
Bisnow: Has the focus of the program changed at all over the last year as we’ve learned more about the virus and the way it is transmitted? I saw on the website the air quality section said "newly added," and it wasn’t in some of the older communications, so has there been more of a focus recently on air quality and that kind of transmission?
Ein: Definitely. The whole world is continually learning new things about the virus and the best way to mitigate its impact, and we’re doing the same thing. We’re constantly absorbing all the best information from all the experts. We have a partnership with [George Washington University's] School of Public Health and other strategic partners to help us do that. We also have the unique perspective we share with others. But the state of the art in terms of thinking about how to make a space safe is constantly evolving, and we think it’s critical that companies like ours are always re-evaluating, adding new features and staying on top of the latest best practices.
Bisnow: Some of these technologies and products that are part of the SafeSpaces system were already things that Kastle Systems offered, like touchless access, right? So, how well did the innovations that your company had made previously prepare you for the pandemic, for this moment, and give you a head start on being a leader in preparing for the return to work?
Ein: That’s why we were the perfect company to help people think about and actually get people back to work, because we have this platform. We’re effectively the operating system for the building already. And with the mission to keep property and people in buildings safe, and again this was just a new threat added to the threats we’ve been protecting properties and people from for 50 years. Our technology platform that we’ve invested huge amounts of money over the last decade was perfectly positioned as the core platform for this new challenge. We had to add things specifically related to this, but it was on top of a platform that was the ideal platform to build upon.
Bisnow: How have you measured the success of this program? Is it about the number of people that return to the office and use it, or are there ways to track how effective it is in preventing the spread of the virus?
Ein: That’s a good question. I think it’s both. Our No. 1 goal is to protect people and prevent the spread of the virus in the office environments we protect. So at the end of the day, we always measure the work by, ‘Are we keeping people safe?’ So that is the most important metric we’ll use to measure the effectiveness of the framework that we’ve developed.
But I do think also there is the secondary impact, which is, 'Will it make people feel comfortable coming back?' So over time we want to make sure the buildings that are protected with Kastle SafeSpaces are ones that actually do have more people coming back to the office because they are safer and they feel safer.
Bisnow: How many of these precautions, these different technologies and systems, do you think will be with us for the long term? Do you think this has changed the way we’re going to enter buildings and use offices well after the pandemic is behind us?
Ein: I do. I think across the economy that Covid has created some trends, but accelerated a much greater number of trends, with technology adoption that was happening before but now has been massively accelerated. A number of the things we’re doing here for Covid are measures that we’ve suggested people use for other threats. And so I do think that a lot of these measures will be here for a long time, and I think it’s a good thing.
We have a line, something we’ve said for a long time: "Our goal is to make security more effective, more economic and less intrusive." So if you think about it, you can protect any building with intense security measures that would make it very difficult to get in the building and be very costly, but that’s not what we try to do. We’re trying to solve for what we refer to as the golden triangle of making security more effective, more economic, meaning cheaper, and less intrusive. That’s the same mindset we’ve applied to what we’re doing with Covid. So the idea is buildings will implement these, but it’s going to make people’s lives easier, not harder. And a lot of the technologies you’ve used, you actually can use in place of other measures that might be more intrusive or more expensive.
Bisnow: How has the pandemic affected Kastle Systems' business, in terms of your revenues and the number of clients you have that use your products?
Ein: We are always cognizant that this has been a really hard time for a lot of people and a lot of companies. The demand for what Kastle has done has exploded over the last year. People have reached out in unprecedented numbers asking for our help to think through this challenge. So none of us would wish this upon any of us, but we’re really glad that we’ve been in a position to help people, and it really has led to explosive demand for what we do.
