Attention Members: Log in to pay your dues today


Three Sustainability Trends for Earth Day

April 21, 2017 | Todd Feist

April 22 is Earth Day, so it’s great time to take a look at some of the emerging sustainability trends in investment real estate and the larger economy.

  1. Corporate Focus on Sustainability:

    The federal government may be in the process of pumping the brakes on efforts to combat climate change, but corporations, especially public and global ones, continue to recognize climate change risk and implement strategies to protect revenue as temperatures and sea levels rise. This includes large real estate owners as well as companies that lease space.

    Those companies not yet addressing climate change risk are increasingly pressured to do so by their investors and shareholders. Whether motivated by social consciousness or financial interest, these stakeholders ask companies to disclose their sustainability efforts—and strengthen their sustainability performance.

    This trend was evident in the 2016 shareholder proxy proposal process, which saw a record 172 climate-related resolutions (formal submissions advocating a company take a specific course of action). Most were submitted to large-cap companies, but Deloitte predicts that shareholders will soon turn to small- and mid-cap companies with their climate change concerns.

  2. Internet of Things (IoT):

    IoT refers to Internet-connected sensors and devices, and the commercial real estate industry is among the early adopters, evidenced in the “smart” building movement. IoT enables precise, flexible measurement and control of everything from interior temperatures to security and access management. It allows centralized operation of thermostats, HVAC controls, ventilation, lighting, and a wide range of devices that impact resource efficiency and the indoor environmental quality of a property.

    Challenges still remain with connectivity, interoperability among disparate systems, data collection and security, and the full realization of IoT’s potential in a cost-effective manner. Still, experts think IoT will have a huge impact on sustainability, space optimization, and the health and productivity of building occupants. Gartner predicts IoT in commercial buildings will grow from 377.3 million installed devices in 2015 to 1.1 billion in 2018.

  3. Wider Access to Sustainability Programs:

    Owners and tenants increasingly expect at least a baseline level of sustainability. The easiest way to demonstrate sustainability is through a certification, and a number of programs have emerged for properties and property types overlooked by traditional certification schemes.

    Perhaps the greatest momentum is with the IREM Certified Sustainable Property program. To date, since launch of the current version in fall 2015, IREM has certified 85 office properties, multifamily communities, and shopping centers. The program provides a framework for initiating a sustainability program and lays the groundwork for performance improvements and eventually certification—so it provides that access to sustainability and allows properties in all locations, of all classes, to achieve and capitalize on success.

What trends are you seeing in your market?

About the Author
Todd Feist is the Sustainability Program Manager at IREM Headquarters in Chicago. He develops classroom and online courses and helps manage the IREM Sustainability program, including the IREM Certified Sustainable Property certification. 

Leave Comment

Login

Name*
Email*
(For verification purposes only)
Comment*
Enter the text shown in this image:*(Input is case sensitive)