Week 26: Why Shadow IT Is the Hidden Threat in CRE

In this weekly series, we explore how the commercial real estate industry is being transformed by data and digital infrastructure. Guided by the principles in Peak Property Performance, we unpack a new idea every week to help owners unlock value, reduce risk, and future-proof their portfolios. Learn more about OpticWise and Bill Douglas, the authors of this series.

In today’s tech-enabled buildings, there’s a quiet risk growing behind the scenes—Shadow IT.

These are the unauthorized devices, networks, apps, and integrations that vendors, tenants, or staff deploy without ownership’s knowledge.

They’re not logged. They’re not approved. But they’re everywhere.  And in CRE, they’re more dangerous than you might think.

What Exactly Is Shadow IT?

In a traditional enterprise, Shadow IT might look like employees using unapproved cloud services.

But in commercial real estate, it takes a more physical—and riskier—form:

• A vendor installing an unmonitored network switch in a riser
  
  
• A tenant plugging in unauthorized wireless access points
  
  
• An ops tech layering on a cloud dashboard without IT review
  
  
• Smart devices or sensors phoning home to third-party servers
  
  

These tools often live outside the owner’s visibility or control—yet operate inside your building’s digital ecosystem.

Why It’s a Big Deal in CRE

Shadow IT introduces risk at every layer of your building’s tech stack:

• Security: Unknown devices create attack surfaces, open ports, and potential malware injection points
  
  
• Compliance: ESG and risk audits are undermined by undocumented infrastructure
  
  
• Data Loss: Tenant or system data may be transmitted to third-party servers without safeguards
  
  
• Redundancy & Waste: Shadow systems duplicate functionality and bloat operational costs
  
  
• Performance: Rogue devices clog bandwidth, interfere with BMS operations, or degrade network QoS

And perhaps most critically: Ownership loses control.

The Root Cause: Lack of Centralized Digital Infrastructure

Shadow IT thrives in buildings without proper DDI—Data & Digital Infrastructure.
 When owners don’t own the backbone, vendors will build their own.

It’s not malicious. It’s operational necessity.  If the building doesn’t provide secure, reliable, and extensible infrastructure, someone else will fill the gap—and they won’t ask for permission.

How to Eliminate Shadow IT (Without Stifling Innovation)

You don’t need to kill creativity or slow down upgrades.  You need to take ownership of your infrastructure.

Here’s how:

1. Own  control the network
    Control your riser, closet, and backhaul architecture. Don’t leave it up to third parties.
   
   
2. Centralize connectivity
    Move to a unified, building-wide network that enables multi-tenant use cases—but under one secure governance layer.
   
   
3. Create a tech intake process
    Require vendors to submit their connectivity and data requirements through a standardized checklist.
   
   
4. Conduct a PPP Digital Infrastructure Review
    Our DDI assessment surfaces hidden systems, legacy gaps, and unauthorized gear.
   
   
5. Broadcast your standard
    Make it clear to tenants and vendors: this is how digital infrastructure works here—and why it’s better for everyone.
   
   

Shadow IT Is a Symptom. The Cure Is Ownership.

You don’t have to fight Shadow IT. You just have to build better infrastructure than anyone else would install on your behalf. Control the pipe. Own the stack. Set the rules.  That’s the difference between being a landlord and being a digital-first operator.

 

Andrew Stanton CEO Proptech-PR

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