Five Strategies For A More Sustainable Real Estate Portfolio
Real estate accounts for approximately 40% of the world’s energy consumption and a third of all carbon emissions. That means that real estate professionals are on the frontlines of climate change risk created by greenhouse gas (GHG) emissions. We have a responsibility to reduce the impact of our facilities and to help our clients in turn. And, many building owners, investors and occupiers are doing just that.
Following are five key ways that leading companies are reducing their carbon footprints.
- Leverage renewable energy. Renewable energy offers an exceptional opportunity to not only reduce consumption of GHG-producing fossil fuels, but also to achieve immense cost savings. And, it’s possible to implement a renewable energy solution for your portfolio with little to no upfront capital investment. Using alternative energy service agreements, JLL clients saved 452,000 metric tons of carbon emissions in 2017. And, they can potentially avoid generating more than 750,000 additional metric tons in the future by adopting additional recommendations.
- Pursue green building certifications. Building construction and operations have extensive direct and indirect impacts on the environment. Many property developers have adopted the LEED standards of the U.S. Green Building Council (USGBC), of course, but other options include programs created by the U.S. Green Building Initiative, the International WELL Building Institute, the Building Research Establishment, the National Association of Homebuilders and other organizations. The proliferation of standards and certifications has helped to deliver a growing inventory of efficient, sustainable and high-performance buildings. In 2017 alone, for instance, 225 of JLL’s clients achieved green building certifications.
- Set science-based emissions targets. Rather than committing to reducing greenhouse gas (GHG) emissions by an arbitrary percentage, many companies are adopting the science-based target approach. Created by the Carbon Disclosure Project and other nonprofit partners, the approach refers to GHG targets in line with level of decarbonization required to keep the global temperature increase below 2°C, as described in the Paris Agreement of the Intergovernmental Panel on Climate Change (IPCC). Seeing the advantage of this approach, JLL itself is developing SBTs with goal of not only reducing GHGs, but also to drive innovation. As the real estate industry transitions into low-carbon mode, innovative new technologies and practices will undoubtedly emerge—presenting opportunities to help our clients adopt new strategies to reduce their carbon footprints.
- Reduce building-related emissions and energy consumption. As major consumers of fossil fuel-based energy, buildings have played a major role in carbon emissions. In addition to adopting renewable energy sources, you can use today’s leading building technologies to reduce consumption of energy from any source. Combined with Internet of Things-based smart building management tools, high-efficiency smart building systems can be constantly fine-tuned to run smoothly and prevent energy waste. These systems not only reduce energy costs, but also support workplace services that go a long way toward improving the human experience at work.
- Commit to facility management vendors invested in environmental sustainability. From paper towels and HVAC parts to window cleaning and landscaping services, commercial buildings rely on numerous vendors for daily operations. By choosing suppliers and service providers with strong sustainability practices, you can extend your GHG reduction efforts. For example, when you’re looking at waste haulers, check on their recycling practices—are they operating on par with industry averages and competitors? One way to find out is to partner with platforms like EcoVadis or Avetta—JLL works with both—that evaluate suppliers’ practices and identify risks.
Some organizations are adopting the “circular economy” approach to procurement, in which you use resources for as long as possible before recycling or recovering source materials, or regenerating new products and materials out of the original item. For example, JLL’s UK offices have adopted biodegradable cups and cutlery, and recycled more than three tons of coffee grinds into biofuel.
Your vendor code of conduct is another place to look for GHG reductions. JLL, for instance, requires all vendors—whether they’re serving JLL directly or JLL’s facility management clients—to follow a code of conduct that includes environmental requirements. And, some of our offices have adopted a procurement framework based on five levels of sustainable procurement. The framework provides a systematic approach that allows for measurement and monitoring of our progress in sustainable procurement.
As we face unprecedented risks created by climate change, real estate professionals in organizations of all shapes and sizes have an opportunity to shape our environmental future. To act otherwise is to deny our fundamental responsibility as practitioners in the trenches: to reduce, rather than enlarge, our carbon footprints.
Richard Batten is Global Chief Corporate Responsibility Officer at JLL.
Article originally appeared in GlobeSt.