Industry making strides in reducing carbon footprint, report says
A new report from from the Urban Land Institute’s (ULI) Greenprint Center for Building Performance shows that the real estate industry has made significant progress over the past 10 years in reducing carbon emissions and energy consumption while increasing asset value. The Greenprint Center, which is celebrating its tenth anniversary, comprises real estate owners, investors, and financial institutions.
Volume 10 of the Greenprint Performance Report, which measures and tracks the performance of 8,916 properties owned by Greenprint’s members, demonstrates a 10-year improvement of 17 percent in energy use intensity, which is the annual energy consumption divided by gross floor area.
The report also finds that Greenprint members are still on track to reduce carbon emissions by 50 percent by 2030.
“For the past ten years Greenprint has worked with the real estate investment community to help expand and improve upon sustainability best practices within the commercial real estate sector,” said Daniel M. Cashdan, president, HFF Securities (a JLL Company) and chairman of The Center for Sustainability and Economic Performance, which houses the Greenprint Center. “As the race against climate change’s various impacts on our cities picks up, the focus of global fiduciaries has become sharpened. Greenprint, as part of our Center for Sustainability and Economic Performance, exists to serve as a resource hub for investors across the globe.”
This year, Greenprint members identified three trends that are pushing real estate companies to stay innovative and continue integrating sustainability into their core business. These trends are:
• A move towards a circular economy: To fully address the environmental impact of buildings, real estate must move towards a circular economy where waste of materials is minimized. This includes incorporating a “reduce, reuse, recycle” mindset for building materials.
• Intensification of climate legislation that sets building performance standards: In the absence of federal guidance, more than 30 major cities — from San Francisco to Atlanta—have set energy benchmarking policies for buildings. Cities are also beginning to set minimum performance standards that become more stringent over time.
• Heightened investor pressure on ESG initiatives: Investors are asking real estate owners and asset managers for more information on their real estate funds’ environmental, social and governance (ESG) programs. Many investors now see ESG initiatives as material to long-term investment returns and work with asset managers to balance ESG and financial returns.
The report reflects the results of hundreds of projects and best practices Greenprint members have undertaken to reduce energy consumption and carbon emissions. Examples include:
Green leasing for multifamily housing: Greenprint member GID Investment Advisers, a multifamily real estate developer, investor and operator with properties across the United States, incorporated a “green lease addendum” into all master lease forms.
Net zero energy investments: In 2018, Greenprint members reported investments of over $2.5 million in renewable energy technologies which helps support buildings on their path to aspiring for net zero energy (NZE).
In 2018, Greenprint members reported over $2.23 million in water efficiency investments.
The data used in the report was submitted to the Greenprint Center by its members and affiliated partners. A few include BlackRock; Boston Properties; CalPERS; Clarion Partners; CommonWealth Partners; DWS; GID; The Howard Hughes Corporation; Jones Lang LaSalle; Prologis; Rudin Management Company, Inc.; SL Green; and Tishman Speyer.