Today’s Global Climate Strike is a wake-up call for everyone. “Our house is on fire – let’s act like it. We demand climate justice for everyone,” is the call to arms by the strike’s organisers.
Should the property industry be a target for the strikers’ anger? Could we have done more to tackle climate change over the years? And most importantly, what should we be doing now to address fast-growing fears over the future of planet Earth?
Despite a flurry of activity in the 2000s, many of the sustainability measures that emerged then were forgotten during the mayhem of the 2008-09 crash. The industry could probably have got further in addressing climate change over the past two decades if this momentum had not been lost.
The World Economic Forum estimates that the real estate sector consumes more than 40% of global energy per year and that buildings originate 20% of greenhouse gas emissions and use 40% of raw materials.
The real estate case to support action on climate change is both an economic and a moral one
At the same time, the World Green Building Council states that the percentage of owners reporting that new green buildings have an asset value higher than that of traditional buildings has nearly doubled to 30%.
BNP Paribas Real Estate has said: “Green properties improve returns and future-proof the value of real estate investments. These types of properties have lower operating expenses and voids and can generate higher rents.”
So crucially, particularly when looking at the whole life of a building, the real estate case to support action on climate change is both an economic and a moral one. The industry, encouraged by its customers, is in action mode.
Property companies’ go-to approach has been to focus on energy initiatives through BREEAM-type certification and efficiency improvements, usually off a stated baseline. Like some of our peers, we have already exceeded our original targets, ahead of schedule.
Now is the time to build on these foundations, not least because our customers have their own significant sustainability ambitions. For example, DPD (La Poste) has the world’s largest electric vehicle fleet and has committed to power them through renewable energy – a bold measure. It has also announced a first all-electric parcel depot in Westminster, with the capacity to deliver 2,000 parcels a day using an all-electric fleet.
Amazon has also gone big on renewable energy, committing investment to wind farms in the US, Sweden and Ireland. I could cite many other key SEGRO customers with similar objectives: DHL, Yoox Net-a-Porter, IKEA – the list goes on.
So the minimum pledge has to be to reduce our carbon footprint in line with the Paris Agreement on Climate Change by 2050. Our own path to that goal is to achieve a 40% reduction by 2025.
How can the industry succeed? Relatively easily, with forward planning: work out what is material to your business, identify what you can influence, have a science-based approach to measurement and then ensure management control. We are particularly focused on procurement and generating zero-carbon renewable energy, sending zero waste to landfill, conducting full lifecycle assessments and tackling embodied carbon by challenging the choice of materials.
And the really fun part? Improving biodiversity. We have introduced bees into many of our developments and have more than 150 hives across our estates. Aside from the pollinating advantages, we’ve found customers keen to include apiculture in their wellbeing initiatives (and they seem to enjoy the honey, too). Pocket parks, insect hotels, bat boxes, rice fields, vineyards, aubergines, sheep and even buffalo now appear across our portfolio.
We know we can do more and have set clear, rigorous targets to ensure we do just that. Now is the time for the whole property industry to collectively step up. Our investors, customers and employees expect nothing less.
Andy Gulliford is chief operating officer of SEGRO