Sustainability in Real Estate
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2015 will no doubt go down as a MIPIM vintage. The event feeds back to its crazy peak. We’ve more or less hit the mid-point of the week, and the pizazz is unabated. It really is an extraordinary thing.
It’s that time of year in the CRC calendar when participants need to think about purchasing allowances in the forecast sale. The forecast allowance window opens this April when participants can order allowances for the CRC year ending 2016 at a reduced cost, paying for the allowances in June 2015. Amendments have been made to the ‘Allocation of Allowances for Payment Regulations’ with the allowance prices set as follows:
How does this affect your properties?
If your organisation lets or sublets properties, or might acquire properties to let out, you will need to consider potential letting restrictions.
The following is a transcript of a provocation delivered by Jon Lovell to the UK Green Building Council City Conference in Manchester on 21 January 2015. It is intended as a stimulus for conversation and an exploration of the relevant issues. We’d love to hear your thoughts.
If we get caught on the chin, do we drop to the deck and take the count, or do we stand firm and come back fighting? But more than that, do we have our guard up, so the punches don’t land?
Having returned recently from a whirlwind tour of four Chinese cities (Beijng, Xuzhou, Suzhou and Shanghai) as part of the UK China Smart Cities Programme, I’m struck by the seemingly endless possibilities for collaboration between the UK and China on the “smart cities” and sustainable development agendas.
The Energy Act 2011 places a duty on the Secretary of State for Energy & Climate Change to bring forth regulations to improve the energy efficiency of private rented buildings in both the domestic and non-domestic sectors in England and Wales. The Regulations must be in force by 1 April 2018, and will require all eligible properties to be improved to a Minimum Energy Standard.
My last blog looked at the science and scepticism behind climate change, a review which was prompted by a private equity client asking if the case was proven. They also asked what we, in the real estate world, would need to do to adapt to a changing climate.
This summer’s London Crane Survey points to a rebounding development market across the capital. Perhaps unsurprisingly, driven by a combination of planning policy and the expectations of investors and occupiers, BREEAM now stands as a de facto badge of credibility for new product in core markets. Our research shows that 83% of developments in the survey are seeking to achieve a BREEAM rating. Half of those are seeking an ‘Excellent’ rating, with three schemes targeting ‘Outstanding’; the highest rating available.
I was recently asked by one of the largest global private equity houses about the latest scientific evidence concerning climate change and whether this “proved the case” beyond doubt – and if so, what do we do about it? Although there are still a few ‘doubters’ and it is increasingly difficult to hear rational arguments from them, they do have a habit of grabbing the headlines. Maybe, just maybe, that’s got something to do with some leading journalists being in the doubters/flat-Earth camp?
There is no question that sustainability is now a fundamental commercial real estate concern affecting long-term value generation and short-term profitability, especially in the context of mature markets such as the United States, Western Europe, and Australia. The combined demands of occupiers, investors, and regulators are such that tangible benefits can be derived from embedding sustainability into the full investment process, with a range of property value fundamentals — rental growth, yield premiums, total occupancy costs, and the like — increasingly sensitive to sustainability factors.