Real estate industry prioritizes decarbonization in 2022

An increasing number of value-add investment opportunities will emerge in 2022, said Savills, as decarbonizing buildings and ESG-requirements create redevelopment opportunities across Europe. 

The international real estate advisor said that the risk of stranded assets was rising because occupiers were demanding buildings with high environmental credentials and that this would be an opportunity for investors prepared to undertake retrofitting and refurbishment. 

In its European Themes 2022 report, Savills said that regulations and planning policies will force a shift in focus from new office development to renovation to avoid the embodied carbon emissions associated with construction. Meanwhile, the real estate industry will be looking to measure the carbon footprint of assets to identify underperforming buildings and improve energy performance as it makes net-zero “a priority”. 

“Net-zero emissions are the key sustainability requirement on the European commercial property market. Investment funds and international tenants expect low emissions and plans for achieving them in Poland too. We are already seeing how asset portfolios and the availability of financing for non-ESG compliant real estate are changing. We are now on the brink of a major transformation. Reducing our emissions and carbon footprint is key to ESG policies and should be an inherent part of any real estate strategy. It is therefore advisable that investors and asset managers measure the carbon footprint of their buildings and assess the climate risk of new acquisitions. Looking ahead, building a competitive edge in real estate will largely require implementing climate tech solutions” Katarzyna Chwalbińska-Kusek, ESG & Sustainability Lead at Savills in Poland, said.

(WBJ)