Real estate’s path to sustainability: meeting the net zero challenge
As the world’s largest emitter of greenhouse gases, accounting for 37% of total emissions, the real estate sector holds major responsibility in the achievement of net zero.
The real estate industry is facing increasing pressure to act in the race to net zero, with new building standards and regulations holding the sector accountable for its emissions. Financial incentives are driving additional pressure, notably in the form of brown discounting, wherein assets which fail to meet strict emission targets not only miss out on green premiums (increased market and rental value for being sustainable), but also experience devaluation. This underscores the urgency for change in the sector.
However, with the anticipated cost of sustainability action in the built environment totalling £4 trillion annually, equivalent to nearly half the value of the real estate market, the challenge lies in finding ways to make assets greener whilst adhering to budget constraints.
In Western nations, a significant percentage of real estate emissions (75%) is attributed to building usage and maintenance. Consequently, a logical first step is to implement green retrofitting and renovation measures. These initiatives are considerably less cost intensive than cutting emissions linked to construction and may involve strategies such as transitioning to energy-efficient lighting or installing electric vehicle chargers and heat pumps.
For those unsure how to begin this journey, a recent article by Property Week outlines three key steps to ensure success.
- What gets measured gets managed
Measure the environmental performance for each tenant, building or fund and rank them. By having all relevant information, refurbishment priorities can be set.
- Gather insights for good decisions
Action plans should be developed based on both financial returns and impact on emissions. Turn to outside support to fine-tune figures and evaluate costs and ensure that sound understanding is gained before taking action.
- Move forward, now
Equip the industry with a new generation of engineers, project managers, contractors, technicians, auditors and consultants who will be capable of guiding real estate towards net zero. Prioritise ESG in all endeavours and ensure stakeholders are aligned in net zero policies and contract plans.
Decision makers in the real estate sector hold a great responsibility to decrease emissions, and the implementation of green retrofitting presents an ideal opportunity to transform the industry and deliver tangible contributions to net zero.
For property owners and asset managers looking to make these changes whilst reducing associated expenses, a partnership with Zest offers fully managed EV charging solutions at zero cost. It’s through partnerships of this nature that the real estate industry will be able to succeed in its responsibility to achieve net zero.
.webp)
.jpeg)
