City governments are setting ambitious sustainability targets, but with real estate accounting for an average of 60 per cent of overall carbon emissions, there’s a dramatic need for the industry to step up.
JLL has cited the need to prioritise real estate decarbonisation in a new report examining the responsibility of the real estate sector to contribute to emissions reductions.
Called Decarbonising Cities and Real Estate, the report estimates that buildings contribute close to 60 per cent of overall emissions, surpassing estimates made by the World Green Building Council, which has it at 40 per cent.
According to Kamya Miglani, JLL’s head of ESG research, Asia-Pacific region, it’s time the world acknowledged that “buildings are both the problem and the solution for our climate crisis”.
She noted that the company’s research identified the Asia-Pacific region in particular as an area that needs to change, with a number of its cities sitting far above the global average for building emissions, such as Tokyo (73 per cent), Seoul (69 per cent) and Melbourne (66 per cent).
The method of construction in this region also poses a need for cities to take aggressive action, and the organisation believes that partnerships between the private and public sector are critical to driving tangible progress in decarbonising the economy.
“For Asia Pacific, this is especially important in cities like Hong Kong, where 85 per cent of buildings are over 10 years old and extensive retrofitting is required of existing building stock. Yet no targets have been set to decarbonise buildings,” Ms Miglani said.
While cities have been proactive in crafting general net-zero goals, she noted that regulation has lagged behind but warned that it wouldn’t be long until new laws come into play.
“Rather than waiting for regulations to kick in before taking action, building owners, investors and occupiers are encouraged to act now to develop more resilient assets and create a competitive advantage,” the report noted.
The company has made a number of recommendations, including “doubling down on energy efficiency initiatives and exploring onsite and offsite renewables – which in turn requires city governments to move in lockstep and provide a green local energy grid”.
And participating or facilitating knowledge sharing and accelerator programs makes a significant contribution to the movement, playing a pivotal role in the process of retrofitting existing buildings, particularly for small owners and occupiers.
The firm noted it’s looking to all the major industry stakeholders to play a part, including “real estate landlords, investors, developers and occupiers”.
Just because there are no ESG standards or targets related to buildings in your city doesn’t mean you can delay acting, JLL said.
“There will be winners and losers as cities race to net zero carbon,” Ms Miglani foreshadowed.
ABOUT THE AUTHOR
Based in Sydney, Juliet Helmke has a broad range of reporting and editorial experience across the areas of business, technology, entertainment and the arts. She was formerly Senior Editor at The New York Observer.
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