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Climate change is on everyone’s agenda and the recent COP26 in Glasgow certainly focused everyone’s minds on the challenge ahead. But how much is the real estate sector stepping up to the challenge?
We decided to run a LinkedIn poll and ask people what they thought would be the key factor that will drive change in the real estate industry so that it actually reduces its environmental impact. The results were as follows:
The results were certainly not what we expected. Half of respondents identified government intervention through either incentives or legislation as being the most important factor, followed by innovation and technology (31%).
What was most surprising though, was how little credit landlords and real estate investors received for being able to have an impact – only 5% of respondents thought they were key to driving change - suggesting many believe that they will only act if they are forced or encouraged to by government intervention. It doesn’t exactly show confidence in our landlords and investors in taking initiative for the important task ahead.
With buildings being responsible for almost 40% of global energy-related carbon emissions and 50% of all extracted materials, the second Thursday of COP was dedicated to the built environment and the huge challenge the sector faces
The good news is that we’ve seen some new commitments specific to the real estate section as a result of COP such as more companies signing up to the WorldGBC Net Zero Carbon Buildings Commitment. We’re even more pleased to see a number of our clients signed up to this, including British Land, Redevco and Bruntwood.
But we need to see real action on these promises and targets that have been set. WHAT is going to get these targets achieved and WHERE are the real actions right now? The real estate industry needs to act as a whole, considering every stage of the building life cycle AND bringing everyone together from each supply chain associated with that stage.
Are there initiatives going above and beyond the statutory requirements where those in the real estate sector can show they ARE genuine about their own desire to reduce their environmental impact, and not just doing it because they are told to? Kings Cross achieving carbon neutral status in November 2021 was cited as an example to other landlords and real estate businesses on the measures that can be taken and the positive results which follow: https://www.kingscross.co.uk/kings-cross-is-carbon-neutral. This undoubtedly puts them closer to achieving targets set for 2030 and 2050, and it will be interesting to see whether tenants actively take this into consideration when choosing to be based there.
As the survey suggests that government-led initiative/legislation will be key to driving change in the sector, it’s hard for landlords and investors to demonstrate that they would have done this anyway. A tipping point will likely soon occur, where those who dare to drive forward positive change and accelerate beyond the legislative minimum will also begin to reap the rewards, as more people look to work with businesses who are ‘doing the right thing’. Those who wait for the Government, UN or other bodies to force the change might be too late.
Further reading:
You can read more about some of the COP commitments regarding the built environment here: