An analysis by CBRE, the global real estate consultancy market operator, shows that the main drivers for companies to move towards ESG are regulations, such as the Paris Agreement and the Goals of UN sustainable development, rising operating costs and increasing control from owners.
The CBRE analysis also shows that around 70% of respondents focused their attention on ESG in 2022, driven by external factors such as the government’s mandate for ESG strategy transparency, but also due to higher energy prices (55%). At the same time, the company’s internal policy, values, or ethics represented the top priorities for all respondents.
Concurrently, the ESG characteristics of buildings have a direct impact on real estate transactions. Reducing energy consumption weighed the most in occupants’ investment and transaction decisions (88%). Also, more than half of respondents would seek a discount or reject an offer altogether if a building did not have these features.
The data analyzed by CBRE revealed a much greater emphasis on the social side from companies. Thus, in real estate decisions, proximity to public transport is important for 86% of respondents. At the same time, 52% said they would reject a building that is in the middle of a controversy.
The main challenges to implementing ESG goals are the availability or poor quality of data (53%), costs exceeding benefits, making it difficult to justify action (39%), and unknown or uncertain benefits (36%).
Investors and tenants in Romania appear to have higher expectations regarding the environmental characteristics of the building than their counterparts in other countries, according to CBRE’s survey of 20 building owners in Romania.
The results of the ESG analysis carried out by CBRE also show that 99% of Romanian respondents consider features that reduce energy consumption to be a priority. At the same time, certification for green buildings ranks second in the opinion of Romanian owners, with a percentage of 89%. Among the key environmental features for building owners is smart technology, which adjusts building operations to reduce environmental impact (88%). The generation of renewable energy and the existence of a charging point for electric vehicles are also at the top of the priority criteria for property owners.
As the ESG component becomes a priority, commercial real estate (CRE) companies are beginning to improve and capitalize on their ESG performance to generate value and remain competitive.