ULI has kicked off a new project in partnership with several major real estate organizations–including Allianz Real Estate, Catella, Hines, Redevco and Schroders Capital–that will support the built environment in Europe on its urgent journey to carbon neutrality.
The project, titled Fast-track to Decarbonisation: An Integrated Roadmap for the Built Environment, aims to support the industry across Europe to speed up and scale up the decarbonization process by analyzing and consolidating the real estate industry’s approach to net zero, assessing progress and the impact of industry frameworks, as well as identifying urgent gaps and barriers that need to be bridged. The anticipated output will be a roadmap to enable the industry to accelerate progress and present an effective and efficient united front to support decarbonization in collaboration with other stakeholders, such as tenants, the insurance sector and energy and infrastructure/mobility providers.
“A lot is already happening in the industry,” said ULI Europe CEO Lisette van Doorn. “Many investors and managers have already announced net-zero carbon targets. However, many experience significant challenges when trying to implement these pledges. These range from legacy regulation or insurance issues holding up new innovations, current real estate valuation approaches not addressing the risks appropriately–hence complicating the business case for making the necessary investment –to lack of knowledge and expertise across the value chain and alignment issues between tenants and landlords. These issues show that the industry must collaborate and collectively work through the issues in order to scale up new innovations and speed up the process. Thanks to the early support of these leading, influential real estate companies, we can get started on this important initiative straightaway with more partners also looking to join us on our journey.”
Fast-track to Decarbonisation aims to further the ULI mission by delivering a critical industry evaluation and analysis of the built environment approach to decarbonization, focusing on the actors within the sector as well as those in close connection to it. The project will provide:
- an overview of the relations and dependencies between the different actors and stakeholders within the built environment in the transition to net zero, including owners and investors/financiers, developers, occupiers and users, valuers, the construction industry and consultants;
- good and emerging practice on how data science, technology and innovation (for example, in materials) can help speed up the process and build the business case for net zero; and,
- an overview of the relations and dependencies with other sectors linked to the built environment (such as energy supply, transport, insurance) and analyze hurdles in the transition to net zero, as well as solutions for how to overcome these.
“As one of the largest investment managers within the global real estate industry, we believe we have a responsibility to support our community in developing the path to decarbonization. And as a business that developed its framework to net zero relatively early, we understand the importance of finding a way through this challenge as a group,” said Raphael Mertens, CRO Allianz Real Estate. “As part of the steering group for this project, Allianz Real Estate will look to ensure the findings provide measurable solutions to this important topic and that insights are shared in a way that encourages others to face the challenges of the built environment’s path to net zero.”
“We think the industry should take a stronger leadership role, to proactively propose scalable solutions and engage with governments and stakeholders to decarbonize in the cleverest way we can,” said Xavier Jongen, managing director, Catella Residential Investment Management. “We should not take a backseat, wait-and-see, and then later complain about how possible future climate-related regulations, that might be enforced on us, affect our industry. Catella looks forward to contributing as much as we can with our partners under the wings of ULI. We hope we can join forces with other stakeholders in implementing a radical decarbonisation strategy for what will be, as far as humankind can know, the most critical challenge of the century. This is a topic for collaboration.”
“Coming out of the COP26 conference, the responsibility of the private sector and especially the real estate industry to dramatically accelerate our efforts to decarbonize have become ever clearer. The urgency could not be higher. Partnering with the ULI on this project, working alongside world-class organizations in the process, is a critical part of collaboration within our industry,” said Peter Epping, global head of environmental, social and governance at Hines. “This ties in with our firm’s strategy to super-charge the reduction of operational and embodied carbon to net zero. We encourage everyone in the real estate sector to join forces to achieve this momentous goal and meet the existential threat that is climate change.”
‘If ever there was a moment when the industry has to come together and work in collaboration it is now,” said Andrew Vaughan, CEO, Redevco.” The climate crisis is an existential threat to all our lives and livelihoods, and it can only be tackled together and so we are delighted to be partnering with ULI and the other leading real estate players.”
“Carbon responsibility is a significant and growing priority, not just for our investors, but for wider society,” said Sophie van Oosterom, global head of real estate, Schroders Capital. “To be truly successful in our ambitions, we believe it is crucial for the whole real estate industry to align carbon objectives to actual outcomes, reducing emissions, rather than to hide behind outperforming theoretical benchmarks. Collaboration between capital providers and managers will help the industry to move beyond statements to create active accountability. It will help to deliver a new alignment around the long-term objectives of capital preservation and sustainable returns, taking into account the long-term cost for society of carbon emissions, versus the current shorter term profit objectives of managers.”
The research part of the project includes a review of existing literature and industry guidance from other organizations, a survey among ULI members to get input on barriers, issues and solutions applied, and interviews with decarbonization experts from the real estate and other industry sectors, academics and real estate practitioners, and other industry organizations.
Besides this core research element, the year-long project includes an active engagement and education program through a significant number of local, and international, multi-disciplinary workshops, roundtables and webinars to increase awareness and collect input from ULI’s members and the wider industry.
The roadmap will be officially launched at a dedicated hybrid summit in summer 2022 and will be followed by at least two Advisory Services panels. These are five-day program within specific cities, where ULI members engage with communities dealing with a wide array of real estate and land use challenges to provide unbiased, expert advice and specific recommendations for improvement, to help the city fast-track and scale up the decarbonization challenge of the built environment.
Fast-track to Decarbonisation is a key element of ULI’s global mission priority to decarbonize the real estate sector and accelerate progress to net zero, as the real estate industry confronts the challenge posed by climate change and seeks to achieve the objective of net zero carbon. Other initiatives already contributing to this effort include the ULI Greenprint Center (formed in 2009), a worldwide alliance of more than 50 leading real estate owners and financial institutions with $1.3 trillion in assets under management, that has been committed to improving the environmental performance of buildings by sharing best practices and performance data. In addition, the ULI Net Zero Imperative aims to accelerate global decarbonization at the city scale. It includes technical assistance for hard-to-decarbonize parts of the built environment, and teams of decarbonization experts helping sponsors develop a cost-effective roadmap to decarbonizing their building portfolio.