Development Magazine Summer 2019

The Future of 5G in the Commercial Real Estate Industry

5G wireless technology is on the way, but it will coexist with today’s 4G LTE networks for many years. Getty Images

A reliable cellular and data network will be vital for a wide range of businesses and other activities.

 

According to the Pew Research Center, 95 percent of Americans own a cellphone, with 77 percent owning smartphones. As traditional broadband usage has dropped in recent years, keeping tenants connected through a cellular signal has become more important than ever for those who want to stay competitive in the commercial real estate industry. And with 5G on the horizon and poised to become a disruptive threat to traditional Wi-Fi and wired internet systems, as well as a key force behind the rise of smart cities, connectivity is going to become more integral to daily life than ever before.

What is 5G?

5G, or the fifth generation of wireless technology, is a standard designed to deliver data speeds greater than 1 gigabit per second and low latency of less than 1 millisecond. This means much faster data speeds (100 times the speed of 4G LTE) and less delay between the request for a data transfer and the start of the data transfer in a cellular environment.

In addition, 5G will provide the ability to connect many more devices at the same time — 100 times more devices than 4G LTE, to be exact. This functionality will enable an explosion in the internet of things (IoT) through the connection of technologies such as virtual reality, drones, smart devices, self-driving cars and more. (See Commercial Real Estate and the Big-Data Deluge.)

5G rollout is slated to begin as early as this year. Cell carriers have been preparing for several years, running trials, laying fiber and building the infrastructure needed to support a high-performance 5G network.

5G’s Weaknesses

However, the advent of 5G networks does not mean 4G LTE will disappear. Instead, 5G will be built alongside today’s 4G LTE network. 4G LTE will serve as a fallback network in situations where users are not covered by new 5G service. It’s likely that 4G LTE service will be an important cellular network well into the year 2030.

Recently, GSMA, which represents the interests of cellular operators around the world, reported that 43 percent of all global connections today are 4G, and that will grow to 60 percent by 2025. Therefore, it’s imperative for the commercial real estate industry to continue to invest in providing solid 4G LTE connections at its properties.

So why isn’t 5G going to be able to cover everywhere and everyone? This has to do with cell signal attenuation, or amplitude reduction, to which 5G is particularly vulnerable.

As frequencies go higher, such as for the millimeter wave technology used by 5G, their propagation — or transmission through mediums — deteriorates greatly compared to traditional lower frequencies. This means that objects such as buildings, trees or foliage and even weather such as snow or rain will severely weaken 5G signals.

A weak cellular signal is nothing new. As commercial real estate investors know all too well, many buildings already experience cellular connectivity issues with 4G LTE. Unfortunately, this complication will only expand further as people begin to rely on the higher frequencies utilized by 5G. In order to work well, 5G requires many more antennas and boosters.

How to Fix the Connectivity Problem

In today’s ultra-competitive business landscape and hyper-connected world, tenants have no patience for poor connectivity, whether it’s in their apartment or office. And commercial real estate professionals face the added challenge of ensuring reliable service without overloading a building’s data infrastructure in the process, which can result in dropped calls, lost signals, compromised cellular security, and consequently, unhappy tenants.

Thankfully, cellular signal boosters can help. Cellular signal boosters capture outdoor signals and bring them into properties, amplifying them as much as 32 times. Companies are developing boosters that will enable 5G to reach its full potential. And unlike active distributive antenna systems (DAS), which install high-capacity infrastructure for larger areas where thousands of users access the network in a small space (i.e. airports and arenas) and thus can be extremely cost- and time-prohibitive, passive DAS technology utilizes existing cell signals by boosting them using antennas and amplifiers. Often, these can be purchased, installed and operated for less than 10 percent of the cost of a major DAS project.

However, the Federal Communications Commission (FCC) has not yet approved cellular signal boosters to operate on 5G millimeter wave frequencies. Companies in this niche are currently petitioning the FCC to allow for the development of new boosters to support these bands.

Once the FCC restrictions are lifted, signal-booster manufacturers will be able to take a crucial step toward the widespread adoption of 5G by applying research to the development of 5G-compatible boosters.

Expected costs for 5G booster installs are hard to predict at this time, but the commercial real estate industry can expect a larger number of them will be needed to ensure widespread 5G coverage due to 5G’s greater attenuation vulnerability.

In the meantime, 4G LTE boosters have been fine-tuned and are available to support existing cellular connectivity needs.

5G will require changes in the commercial real estate industry. Cellular signals will have to be top of mind for all property developments as tenants rely more and more on cellular connectivity, a trend that’s grown during the past few years and is likely to increase because of the enhanced capabilities and speed provided by 5G compared to Wi-Fi or wired internet service.


Know Your Terms

Here are some definitions related to 5G from a December 2018 article in Wired magazine.

The Spectrum. “All radio wave frequencies, from the lowest frequencies (3 kHz) to the highest (300 GHz). The FCC regulates who can use which ranges, or bands, of frequencies to prevent users from interfering with each other’s signals.”

Low-Band Frequencies. “Bands below 1 GHz traditionally used by broadcast radio and television as well as mobile networks; they easily cover large distances and travel through walls, but those are now so crowded that carriers are turning to the higher range of the spectrum.”

Mid-Band Spectrum. “The range of the wireless spectrum from 1 GHz to 6 GHz, used by Bluetooth, Wi-Fi, mobile networks, and many other applications. It’s attractive to carriers because it offers lots of bandwidth while presenting fewer challenges than the millimeter wave range of the spectrum. The catch is that the FCC needs to open more of this spectrum to carriers.”

Millimeter Wave. “The range of the wireless spectrum above either 24 GHz or 30 GHz, depending on whom you ask. There’s plenty of bandwidth on this relatively uncrowded chunk of the spectrum, which means carriers can achieve much faster speeds. But millimeter wave signals are less reliable at long distances.”

Latency. “How long it takes a device to respond to other devices over a network. Faster response time is a big promise of 5G, which could be critical for things like emergency alert systems or self-driving cars.”


 

Jeff Gudewicz is the chief product officer for Wilson Electronics.

From the Archives: Business / Trends Articles from the Previous Issue

mobility hub rendering

Lower Parking Minimums Means Higher Value for Parking Spaces 

Right-sizing parking can save money, lead to less congestion and create alternative land uses.

cutting edge research report cover

Cutting-Edge Research That Has An Impact 

The NAIOP Research Foundation's annual report highlights the relevant studies, activities and deep dives to come in 2019 and beyond.