The vast majority of properties, whether commercial, such as office towers and shopping centers, or residential, are aging. These are often outdated structures that need improvements to adapt to environmental issues.
At the same time, sustainability in the construction environment is expanding beyond the core of decarbonization. Waste reduction, biodiversity preservation and social sustainability are some additional important aspects.
Investors and owners looking to transform obsolete buildings into greener assets can explore several practical solutions, depending on each situation, of course.
This article offers insights to support the journey from brown to green:
1. Develop a fit-for-purpose program
Sustainability initiatives are often presented in a one-size-fits-all approach. This potentially reduces the chance of a project being implemented and wastes time on strategies that are not aligned with investment plans for the building.
A better approach is to first clearly understand the investment strategy for the asset and focus efforts where the greatest impacts can be made. For example, assets with a shorter payback period should prioritize high-impact savings. Assets with a longer payback period have the opportunity to be more aggressive and holistic with their investment plans to reposition or improve performance.
2. Find the hidden value of ESG
Look beyond traditional metrics. Many sustainability measures generate great business from the start. For example, energy efficiency saves money and reduces carbon. This is a scenario where everyone wins.
Investors should also not limit themselves to isolated sustainability goals or view benefits through a limited lens:
• Sustainability can generate financial returns, particularly in energy and carbon reduction, but can also be used to attract tenants. To attract savvy investors, stay ahead of regulations.
• Water is often ignored because it is a relatively cheap resource. However, if you have assets located in areas experiencing water shortages, water conservation should be part of your planning.
• Social impact is difficult to define and, as a result, may be underinvested. But we increasingly see examples of investors trying to create positive change in the community. When done well, the benefits are clear, such as: job creation, public utility solutions, etc.
3. Take action early and often
Just get started! Once your sustainability plan is tailored to your investment strategy, you're ready to start thinking at an asset level. At this point, investors can begin to prioritize activities based on the profile of each building.
Planning, budgeting and implementing green initiatives must always be intentional. Ask yourself how. For example, how does this project help retain tenants? Do we want to accelerate broader net-zero emissions plans that would benefit from increased provision of renewable energy offsets?
With the rapid advancement of the market, waiting does not even offer an advantage. By securing renewables now, we avoid delays behind the rapidly evolving market and regulatory landscape.
Cushman & Wakefield Sustainability Consulting
We develop and help implement your sustainability strategy. We work with some of the largest global occupiers and investors to brainstorm action and strategies for a more sustainable world.
What sets us apart is our ability to collaboratively execute these strategies at every stage for all asset classes.
Contact us for more information.
