Buildings with higher green certification can better compete with new stock entering the market, says the firm
In a new white paper titled ‘The Green Revolution: A Call for Sustainability in Real Estate’, JLL says that while the UAE has been consistently launching green initiatives and projects (and setting bolder targets that are both pro-climate and pro-growth), stakeholders in the real estate industry must take decisive action to safeguard their assets and secure long-term returns.
The published analysis includes valuable insights and key takeaways exploring the critical role of the real estate industry in shaping a sustainable future, and the ramifications of inaction as opposed to proactively pursuing green strategies.
The whitepaper dives deep into the UAE’s efforts to strengthen its position as an advocate for climate action and examines recommendations for stakeholders.
The high energy consumption, carbon emissions, and resource depletion that are characteristic of the built environment, which accounts for nearly 40% of global energy-related carbon emissions and 36% of energy consumption, have made it imperative to integrate sustainability measures into real estate investment decisions to accelerate the Net Zero transition of the sector.
The whitepaper also outlined the importance of making financial investments in green buildings and green construction to offset reduced property values over time and minimise climate-related challenges, especially in the MENA region which is warming at twice the global average rate with temperatures projected to rise by 4°C by 2050.
James Allan, CEO, Middle East and Africa (MEA), JLL said, “The cost of inaction goes beyond accounting for profits and losses. The real estate industry’s failure to adopt and embrace sustainable practices will impact both society and the natural environment, while also deterring investors who equate climate risk with financial risk. Committing to ambitious net zero targets is critical to enhancing both efficiency and financial performance and decarbonising real estate.”
JLL research has revealed that buildings with higher levels of green certification can compete with new stock entering the market for longer periods of time.
In Dubai, such buildings command 5%-10% higher premiums as compared to green premiums of 11.6% in London, 9.9% across nine major markets in Asia, and 7.1% across eight major markets in the US and Canada.