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Data Shows The Industry Is Starting To Act On Sustainability, But Too Many Wait On The Start Lines


Green buildings are delivering higher asset values, and there is a growing performance lag for those with poor sustainability credentials. But despite these incentives, the real estate industry does not believe it will meet net-zero emissions targets.

These are the headline findings of a survey from software company Deepki of commercial real estate asset management professionals. The report, titled Overcoming The Energy Crisis In Real Estate, details the positive impacts the sector is experiencing for energy-efficient buildings and what is holding the industry back from further embracing sustainable changes. 

Bisnow spoke to Deepki Chief Commercial Officer Phill Oliver about how the survey findings reflect what the industry needs to do to increase its drive for sustainability.

Bisnow: The survey found that 80% of asset managers are accelerating plans to improve energy-efficiency. What is driving this surge?

Oliver: In the last 12 months, momentum has definitely accelerated. There’s a recognition that ESG is no longer a pure competitive advantage. The reality is it’s something we all need to move forward on. 

The uptick is also partly due to some asset managers who are starting to share experiences and best practices, which is a positive choice. Buildings are starting to be completed with technologies that are really working to improve sustainability. 

Bisnow: What’s holding some back from making assets more sustainable?

Oliver: Although there are some real estate professionals moving forward, it’s almost as if everyone else is waiting on the start lines to see how technologies work out and how retrofitting hits business margins. They’re still waiting to understand how to balance moral responsibility with wealth. 

Also, there’s a lack of knowledge. Many don’t have the visibility into projects to see that you don’t have to replace; you can recycle and refurbish. There’s a clear skills gap, whether that’s internal or a reluctance to invest in consultants. 

Until people start to see a rise in vacant buildings, many won’t act. This is frustrating because the numbers are there. They don’t need to wait for an empty building to see what’s coming.

Bisnow: How worried should the industry be about the increasing number of unoccupied buildings due to poor energy-efficiency?

Oliver: When you look at the retrofit statistics alongside the speed of obsolescence, there are obviously massive capital and priority gaps. So yes, obsolescence is quite challenging. Deadlines are coming in. We’re not far from 2025, 2030, when buildings will need to meet new energy performance certifications and requirements. 

When we think about green buildings, we focus on big, beautiful buildings in large cities that are capital-rich, which brings access to better materials. A lot of challenges relate to underperforming assets outside these big cities.

We’re retrofitting real estate at a rate of 0.1% per annum, but almost 100% of European real estate needs to be retrofitted. We can’t rely on new buildings, as they only make up 1% of our building stock, and 80% of the buildings in 2050 already exist.


Bisnow: Does the industry understand the concept of a 'green premium'?

Oliver: There’s clear evidence out there that the market expects sustainable buildings. However, the question remains if it will increase asset value or protect existing assets from brown discounting. In both cases, it impacts asset valuation. 

People focus on energy-efficiency, but there’s more to it than that. You could look at occupancy levels or flood risk. People don’t always prioritise the need to address all these factors, instead believing that they’ll just flip an asset if it doesn’t bring the necessary returns. 

By doing this, the industry is not dealing with obsolescent assets. There’s a focus on the good elements, with a view that other elements aren’t our problem right now. 

Bisnow: What does the industry need to do to get moving on sustainability?

Oliver: Property owners need to dig into underperforming assets and use the fact they exist in their portfolio as a learning experience. There’s too much worry that acknowledging them is bad for the brand, but if you look longer-term, there is an opportunity to unite the industry over nonperforming assets.

If people come together, they will realise that the challenges facing 80% of European real estate are common: old boilers, single glazing, flood-risk areas. There is a commonality that we’re not drawing on that could help people move forward. 

Bisnow: Only 7% of survey respondents estimate that most of their assets will hit the net-zero target by 2050. How can the industry work harder?

Oliver: Right now, I don’t think people are equipped to achieve what they need to. We have pockets of success stories, but they’re just pockets. The goals are industrywide, but we're approaching them as individual portfolio managers. People need to share their best practices. 

Bisnow: What are the best practices asset managers should implement to future-proof their portfolio?

Oliver: The biggest step is to genuinely understand your real estate. Data will be your golden thread, bringing everything together so you can see how assets live and breathe. It’s important to look not just at legacy but at the future: based on where I am now, where will I be in five, 10, 15 years' time?

Next, you need to look for quick wins. You need to have a variety of objectives running in parallel that land at different points and align with capital that is available. This is the only way to make objectives realistic and achievable. 

A lot of people overlook whether the building is used as it was intended. Is the use of air conditioning relative to occupancy levels? Is there only one person per floor on a Friday, with a floorplate of lights on? It’s easy to see how you could be more efficient. 

You also need to build momentum and interest. It’s essential to build business confidence that what you’re doing isn’t just the right thing to do but will impact returns. 

This article was produced in collaboration between Deepki and Studio B. Bisnow news staff was not involved in the production of this content.

Studio B is Bisnow’s in-house content and design studio. To learn more about how Studio B can help your team, reach out to