Sustainability in Real Estate

Sustainability in real estate was considered a special niche market not so long ago. It’s clear, however, that environmental factors now command the mainstream of this industry.

That’s because the large majority of consumers are demanding it. A recent Statista survey found that 81% of global real estate consumers named environmental improvements as “extremely important” or “very important.”

It can be said that it was in the early 1990s that “green building” became a well-defined quality. The interest had been sparked for adopting such sustainable features as solar panels, passive solar heating systems, superior insulation materials, geothermal applications, grass rooftops, supplemental wind turbine systems and much more.

Fast forward a decade into the 2000s and eco-friendly homes and commercial buildings became more than “an extra.” They were now a commodity that was frequently required and/or demanded by the consumer. This is especially true of the younger demographic that combines Millennials and the up-and-coming Gen Z. People in these groups have a much higher consciousness about their “personal carbon footprint.” That’s the result of inculcation on behalf of our educational systems along with persistent and widespread media attention to environmental issues.

Sustainability must now be taken into account from the angle of real estate investment as well. For example, when a firm is contemplating the purchase of apartment buildings, condos or detached units with an intent to rent, they must be cognizant that a key marketing strategy will be an ability to bolster these assets as “sustainable.”

Real estate entities will increasingly find themselves obliged to meet policy statements from groups like the World Commission on Environment and Development, the United Nations and the policymakers within their own governments, both at the local and national level.

The outcome of this will be that more real estate developers will make the incorporation of “green practices” as central aspects of their development plans. Creating real estate assets with sustainable profiles, low carbon footprints, eco-friendly procurement of materials policies, reduction of waste and even the efficient use of freshwater resources is no longer an option but a necessity. In many cases, it will not be merely the right thing to do. It will be required by law. At the local city-government level, zoning ordinances requiring minimum green standards are becoming more common.

Originally published on Omid Chaman’s website.