Cushman and Wakefield surveyed 25 of the leading real estate property owners and managers in North America to find out the motivation for owning and developing green buildings and how sustainability affects real estate investment decisions. The results of the study, US Investor Survey – The Ownership View of Sustainable Real Estate, yielded four key findings:
- Demand – Now so more than ever, investors are demanding that investment managers acquire properties that address sustainability. 80% of survey respondents felt that their investors are becoming more interested in how their buildings perform with regard to sustainability, and 60% indicated that they believed the pace of this interest to be increasing.
- Momentum – The demand for sustainable buildings is creating momentum within the industry. The results of this momentum are evident in the fact that 72% of respondents have implemented formal sustainability policies at the fund level. Many of those that have not implemented formal sustainability policies noted that this does not mean sustainability is not a factor in their investment strategy, and 68% of respondents indicated that they include sustainability in their investment evaluations.
- Value – The results relating to value-add for sustainable properties were interesting:more than three quarters of respondents felt that there is a positive difference in the value of sustainable buildings. Additionally, among 14 sustainability factors, energy efficiency was ranked as having the highest impact on asset value. However, it was noted that this is difficult to quantify, and only 16% of respondents were aware of instances where sustainability contributed to a higher rent.
- Perspective – This survey looked at the results of a 2012 Cushman and Wakefield survey of its European investor clients and found that European investors were well ahead of their US counterparts when it came to incorporating sustainability into their investment strategies. This was evident in that 100% of European respondents had both implemented a corporate sustainability policy at the fund level and had consistent methodologies in place for evaluating sustainability in their underwriting.
The results of the Cushman and Wakefield report are encouraging and also highlight the need for expanded incorporation of sustainability into American real estate investing strategies. Waypoint commends Cushman and Wakefield for their work on this study and looks forward to the future of increased sustainability and energy efficiency in commercial real estate. To read the full article, click here.