‘Real estate is now realising that net zero carbon requires systemic change, not just tinkering around the edges’ — JLL’s Emma Hoskyn explains why taking bold action is needed.
Why are investors paying more attention to net zero?
Today’s investors know they have a responsibility to help cut real estate’s sizeable carbon footprint. What’s more, they understand the impact of inaction both in terms of asset value and their reputation. At the same time, there’s growing social and corporate demand for net zero buildings, not to mention increasing legislation and disclosure regulations. On a practical level, the move to net zero carbon can help to protect and enhance asset values and drive operational savings.
How is it driving change in the wider industry?
Real estate is now realising that net zero carbon requires systemic change, not just tinkering around the edges. More companies are signing up to net zero carbon targets and more cities are putting plans together to deliver on government targets, which is driving local policy decisions.
It’s now filtering through to conversations between non-sustainability professionals and companies are upskilling their people on how to decarbonise their buildings and implement net zero strategies. This is driving change at every part of the property lifecycle, from acquiring a building and managing its operational performance to refurbishing.
What needs to happen next?
For companies to achieve their ambitions, net zero must be incorporated into every decision. We therefore need more skills across the industry to ensure a complete understanding of sustainability and net zero and what it means for financing, designing and operating buildings. We equally need a deeper assessment of how existing buildings can be transitioned. Finally, although pledges are growing quickly – with commitments from governments and businesses almost doubling in less than a year – it will require more investment to deliver real results within the timescales we need to see. The potential future climate change risk is enormous. Real estate must respond and adapt today.
How will the governments new 10-point plan help the net zero carbon agenda?
We are encouraged by the measures in the plan which will help drive the UK towards net zero carbon buildings, including decarbonising the grid via investment in wind and hydrogen and the £1bn investment into the insulation of homes and public buildings. In addition, we support the drive to increase green finance opportunities as we are already seeing the benefits that green finance vehicles bring to real estate.
The plans aims to deliver 250,000 green jobs, which will be vitally important to the UK economy and to our environment. The £4bn increase in green investment is also another important step in the right direction and supports ambitions which will be demonstrated at COP26 next year. We would argue that additional investment will be required from the government if the UK wants to be seen as true leaders in tackling environmental issues.