December 6, 2023
Cost and a lack of awareness are barely holding back surge in demand for green real estate
The new RICS Global Sustainability Report for 2023 claims that there is growing demand for green real estate in the APAC region, despite ongoing challenges in raising awareness and the higher costs involved. The publication sets out to outlines the state of the world’s green and sustainable real estate and investor interest in acquiring and developing it.
In the APAC region, 41 percent of survey respondents stated that occupier as well as investor demand for green buildings had risen to some extent within the last twelve months, with the overall global sentiment reflecting this at 42 percent.
When asked what barriers contribute the most to investors being unable to acquire sustainable/green buildings, respondents in APAC cited high initial costs (56.5 percent), lack of a return on investment or uncertainty/lack of data around the benefits of acquiring green buildings (38.4 percent) and lack of knowledge/awareness abut green real estate (36.1 percent) as the main contributing factors.
An interesting insight from the report centred around if respondents currently measure embodied carbon emissions on projects. 40 percent of respondents in APAC answered no to this question, which seemed to be a global trend (Americas 50 percent, Europe 38 percent, MEA 48 percent, UK 44 percent). Furthermore, only 8 percent of respondents in the region answered ‘very well established’ when asked how established on-site waste minimisation and recycling of materials after demolition is, which is low in comparison to the UK, Europe and Americas (20 percent + of respondents answered ‘very well established’ in these regions).
The report also delved into sustainable features and how important these are for occupiers and investors when looking at a building. In the APAC region, 29 percent cited the energy efficiency of a building as being essential, while good air quality and ‘thermal comfort’ was deemed the most important quality at 35 percent.
RICS Senior Public Affairs Officer, Seabook Yam, commented: “The built industry in APAC is ready to take further steps into the sustainability journey. They just need more incentives to handle the uncertainties”.
