Construction Boom Boosts Residential Security

Residential real-estate developments across Asia Pacific have spurred an uptake in electronic security systems. More deployments of access control, intrusion alarm and video surveillance systems are visible.


For access control, biometric locks are gaining interest, particularly for luxury apartments. However, smart cards with PINs are still considered more reliable and cost-effective. Intrusion alarms rely more on wired panels, but with thieves cutting phone lines to disarm alarm systems, residents are beginning to turn to wireless systems.


Developments in wireless video and home automation have resulted in low-resolution video at front doors. Video has to be of sufficient quality for users to recognize people but not so high that it cannot be sent over conventional home bandwidth.


A historic bottleneck with residential IP video was recording, which required a dedicated computer for storage. With the advent of NVRs and certain subscription-based services offered by telecoms, video can be streamed directly onto these devices on- or off-site. These devices are already popular in consumer and residential markets.


With many countries developing their IT infrastructure and countless people signing up for broadband and mobile services, IP-based systems are gaining greater acceptance. IP-based security equipment, however, is still too costly. Apartment building owners are beginning to see the benefits of IP-based systems, particularly for completely new projects, as they save installation time and cost. Homeowners of individual houses, on the other hand, prefer analog systems, as wiring is not so complicated and they have tighter budgets.


Apart from cost, the biggest problem is the network. Close partnerships between Internet service providers and video surveillance vendors need to be established. Redundant communication is necessary, which includes GSM/GPRS, broadband and public switched telephone network line communicators.


Building owners are concerned with network stability. Most devices are easy to install, so problems are usually related to the network — sometimes the network will be down or respond really slowly. Challenges such as fiber-optic or copper cables being cut by accidents or malicious attackers can cause an entire IP system to halt. Integration with other security, home and building systems, such as home entertainment and elevators, is becoming popular. Simple integration, such as video door phones linked to elevators, is now commonplace among newly constructed high-end apartment buildings.


Asia's skyline features some of the world's tallest buildings, keeping developers busy. Compared to the rest of the world, the recession hurt Asia least. However, construction has suffered delays. Condominiums and residential communities continue to be built, but delays have slowed security growth in the residential sector.


"Growth for security systems fell below 5 percent in the APAC region in 2009, and the impact is more profound in Southeast Asia (SEA). The reason being, market participants mainly rely on service contracts during this period of economic slowdown," said Melvin Leong, Program Manager at Frost & Sullivan.


Vendors who serve multinational condominium developers have been impacted more than those who target local developers, said Eric Zheng, Integrated System Director, APAC, Ingersoll Rand Security Technologies.


Vendors have to think outside the box and find nonsecurity uses for their systems. Unless users live in a high-crime area, they usually do not budget for security-related technologies. "After understanding that our system offers more than just security — remote viewing, home automation, arming and disarming alarms via SMS, and so on, users find it a good way to keep in touch with what is happening in their homes," said Charles Lim, Country Manager for Singapore, ADT Security.


Home automation and building automation have sparked serious interest in Asian homeowners and condominium owners.


Market
Residential security depends on other markets, such as building construction, facilities management and real-estate management. "These other markets experienced low growth in 2009 throughout APAC and SEA," Leong said. "However, reductions in insurance premiums, along with increased security concerns, seem to be driving the market."


For 2010, the forecast is positive. "Overall, SEA will grow roughly 5.6 percent this year," said Juan Campos, Regional Manager for APAC, Fermax.


Regulations
Security systems are not mandatory for most of Asia. Separate from fire and safety systems required in all commercial, industrial and residential complexes, the security market will grow modestly unless policy makers implement residential regulations, Leong said. However, residential mandates will have a significant socioeconomic impact on lower income groups, which may be out of reach for less wealthy SEA countries.


In Singapore, submissions to the Building and Construction Authority and the Framework for Strategic Sustainable Development require structure and fire safety, and authorities see equipment pertaining to these regulations as a top priority, said Kee Hua Lim, founder and Principal Architect at Ezra Architects.


For now, the use of security equipment is limited to luxury residential projects. Property developers incorporate high-end technology features in these projects. This niche market makes up roughly 80 percent of security systems installed in SEA, Leong said.


Regional Differences
Asian countries differ on residential security uptake. For the most part, countries with booming construction and infrastructure development have plentiful opportunities, such as India and China.


India
Despite major urban development, Indian residents rely on guarding services. However, more high-end condominiums have adopted IP-based video surveillance and access control with smart cards or even biometrics.


Real-estate developers are already considering video surveillance for high-end residential areas. However, in larger cities like Mumbai and Delhi, video solutions for condominiums are mostly analog. "Users have yet to migrate to the next level," said Shrikant Shitole, VP of Transformation and Managed Services, India and SAARC, Cisco Systems.


With residential campuses comprising multiple apartments in one building, developers often sell each apartment individually. "These individual apartments can either be leased out or owned by the people living in them" Shitole said.


After the developer sells the apartment, the owners register with the local housing committee. "The housing society will then nominate the operations committee, who decides how the campus should be operated, and what systems to put in, including security, fire and safety, power generation, and other physical equipment," Shitole said. Security equipment needs to meet housing society requirements, which often include aesthetics.


North Asia
North Asian countries have strong security uptake, especially China. Dotted with countless mid to high-end apartment buildings, China, Hong Kong, Japan and Taiwan are technologically savvy. "Generally speaking, personal wealth is high and residents desire sophisticated and new technologies," said David Rees, Regional Manager of APAC at Salto Systems.


"The market is not as strong in the homeowner market as it is for hospitality. For access control, projects built in the last 12 to 18 months are still using magnetic card swipes, which are less secure. Within the next two years, we will see more interest in the residential side for more sophisticated systems," Rees said.


Chinese property prices have skyrocketed, driving developers to finish projects quickly. With a robust real-estate market, the residential security market is also booming. "The number of local video door phone manufacturers has grown to 350, with the top 10 being strong competitors," Campos said. Projects are huge, averaging 400 units per project, compared to Europe's 30-unit average for each project.


In Shanghai, luxury apartment buildings are installing hundreds of biometric hand readers, Zheng said. Condominiums in Beijing, Qingdao and the Guangdong Province are widely using card-based systems with mechanical overrides.


Southeast Asia
A construction boom is taking place throughout SEA, particularly in Indonesia and Vietnam. "Still in the early growth stage, luxury and high-end residential properties are the main users for security systems," Leong said.


"In Vietnam and Indonesia, projects are going well and there are few delays," Campos said. With few local manufacturers, vendors from Europe, Korea, Taiwan, Japan and China fare well.


In Vietnam, Ho Chi Minh City and Hanoi are seeing major residential communities being built. Projects are mostly high-end luxury apartments, installing roughly 500 units of video door phones each, Campos said. Comparatively, projects in Indonesia vary more, with fewer luxury projects and more mid- to high-end apartments.


Indonesia is a more mature market, with more houses than apartment buildings, said Johan Haryanto, Director of Hotware Indonesia. Security systems are typically deployed in upscale residential homes.


"Most home units are done internally, with their own control center on-site," said Jeff Lampe, GM of Electronic Systems, Indonesia, G4S Security Services. Customers have little awareness about the technologies involved.


For Jakarta's population of 15 million, only 5,000 to 10,000 alarm systems are installed, largely in upscale homes, Lampe said. "We're not looking at major growth in the area yet. More education is necessary, as the market is niche and very difficult to break into."


Residents are showing interest in IP-based systems, as Internet usage increases. "Almost every resident has Internet access. When this foundation is laid, IP-based technologies will grow," Haryanto said.


The majority of systems are analog and stand-alone for alarms, video surveillance and access control, said Michael Jip, CEO of SMD. "Many home users do not understand the technology, and won't use complicated equipment. Serious players need to make sure that their products are easy to use."


Moving to Singapore, young homeowners are more adventurous about new technologies. The country is security-conscious, and few buildings are being constructed without electronic security, Rees said.


Homeowners are embracing IP-based surveillance with remote monitoring viewing and access control systems designed to bring a touch of lifestyle, said Lim of ADT Security.


Australia and New Zealand
Uptake in residential security is slower in Australia and New Zealand compared to North Asia, but this is changing. The Australasian residential market lags, compared to government and commercial applications.


Australian apartment buildings are moving past mechanical locks and implementing card-based systems for main entrances and elevators. "While it's is slow-moving now, we've flagged it as a very large market," Rees said.


Differing Needs
There are notable differences in security priorities for building owners and homeowners.


Building owners typically cover access control, video surveillance (including video door phones) and intrusion detection on a large scale. Most systems are stand-alone and common areas — such as lobbies, gyms and so on — use access control and video surveillance.


The biggest concern for developers is to sell apartments for a quick return on investment. They usually install inexpensive access control systems that people are used to, Rees said. "We work with developers to show them that it's not much more expensive to put in sophisticated systems, which make a tangible difference."


Apartment building owners are learning about security benefits through business intelligence. "With video surveillance and other security systems, building owners can ensure rent payment, reduce liability and deter vandalism," said Brian Lohse, Director of Business Development, Secure-i.


Energy management allows building owners and operators to run their buildings more intelligently. "Smart metering can help building operators gauge how much hot water or electricity tenants are using, so that they are billed directly for what they use, rather than via one size fits all. This can very quickly decrease the total electricity usage of a building, which adds up to large savings over time," said Bob Heile, Chairman and CEO of ZigBee Alliance.


Homeowners will request aesthetic solutions. "In the Philippines, we have had homeowners ask for cameras to match or at least, not detract from, their interior designs. For example, if a client's home has white walls with many curvatures, our cameras need to be matched in color and installed in such a way that does not disrupt the uniformity of the home's design," said Mark Tan, Sales Manager for Security Products Division, New Datche Philippines.


Homeowners deploy intrusion detection and alarm monitoring more than other systems. "The design and installation for homes and units is very straightforward, while apartment buildings are more complicated. This is not only due to the size of the project, but also the parties involved. For apartments, building management, maintenance and construction teams need to be consulted," said Rojarek Joraka, Account Executive of Far East Creation.


Way Forward
At a glance, Asia's residential development has attracted countless security manufacturers. The construction of condominiums and residential communities will increase security deployments. However, most users in Asia have yet to move from guarding and mechanical locks, to electronic security systems.


With the proliferation of building and home automation systems, more users will adopt security systems for the added bonus of intelligent homes.