The net Zero Challenge in Real Estate

Real estate accounts for nearly 40 per cent of energy-related carbon emissions but cutting emissions to net zero in the sector is highly complex. Investors should focus instead on cutting emissions by refurbishing properties and avoiding new builds. Reducing emissions in real estate portfolios is a growing challenge for asset owners, particularly since greener building are already beginning to show better returns via tenant demand and higher values. Focusing on refurbishment is key to success, said Zsolt Kohalmi, global head of real estate and co-CEO Pictet Alternative Advisors speaking at Sustainability in Practice. Statistics that suggest the most proactive strategy for asset owners seeking to cut emissions in their real estate portfolio involves refurbishing old buildings rather than investing in new real estate. “The reduction has to come from refurbishment,” said Kohalmi, adding that it is possible to cut emissions by 30-70 per cent by refurbishment. One of the challenges in the process comes from the fact there are few common measurements or standards around embedded carbon emissions in real estate. “The focus has to be on how we can improve the way we do new builds like work around creating more sustainable cement,” said Kohalmi.Read more