JLL has appointed Erin Meezan as chief sustainability officer, following the retirement of Richard Batten.
Meezan will report Guy Grainger, global head of sustainability services & ESG and will be responsible for growing JLL's own sustainability programme.
She joins with more than 19 years of sustainability experience and was previously CSO at flooring company Interface, Inc, where she developed its strategy to become a carbon-negative enterprise by 2040.
"We welcome Erin as the new CSO who will build on the work JLL Is unlocking for climate action in built environments, leading us towards our goal of shaping the future of real estate for a better world," said Grainger.
Batten, who joined JLL after it acquired King Sturge, where he was joint senior partner, took on the CSO role in 2017, having previously focused on advising investor clients on commercial property. In addition to his role as CSO, Batten is an advisor on the Science Based Targets initiative (SBTi), Net Zero Expert Advisory Group, and sits on the Bloomberg Green Council.
"I want to thank Richard for his contributions over the last five years as an invaluable leader helping transform the way our company and our clients view sustainability, embedding it as a key pillar of our business," said Grainger.
Sustainability conference ReThink HK returns to the city on October 5th-6th at the Hong Kong Convention and Exhibition Centre.
In its third year, the event aims to help businesses accelerate their transformation towards a more sustainable future. It features a number of speakers from the real estate industry and a “Rethinking Built Spaces” programme, focusing on the built environment.
Sustain will be reporting from the conference next week so look out for news and interviews.
See https://rethink-event.com for more information.
The British Property Federation’s Net Zero Pledge has seen 24 sign-ups from across its membership since its launch three months ago, the industry body said this week.
Signatories to date have more than £75 billion of real estate assets under management and include companies such as LandSec, Cushman & Wakefield, New River Asset Management, JLL and Helical.
To sign-up to the BPF Pledge, members must have, or be developing, net zero targets and plans and are encouraged to join industry-leading net zero carbon programmes or frameworks. Current signatories have committed to the Business Ambition for 1.5 Degrees, Planet Mark, the BBP Climate Commitment, the WorldGBC's Net Zero Carbon Buildings Commitment and Net Zero Lawyers Alliance.
Melanie Leech, chief executive, British Property Federation, said: “Early adopters of the pledge are ideally placed to help our wider membership kick-start or accelerate their net zero programmes and our knowledge hub will be a key resource to facilitate this. Our membership is incredibly diverse and the Net Zero Pledge has been designed to provide the support and guidance needed to help all our members put in place programmes to tackle carbon emissions.”
Great swathes of UK retail property could be unlettable from next year, Savills claims.
The UK government dictates that commercial buildings with an Energy Performance Certificate rating of Grade F or G will be prohibited from being leased. Savills research estimates that 185 million sq ft of retail space is at risk.
Of the space at risk, Savills reckons only 35 million sq ft is retail park, supermarket or shopping mall space ie that owned by larger investors. Most of the vulnerable space will be smaller shops owned by smaller landlords.
Tom Whittington, commercial research director at Savills, said: “Most retail property emissions are actually not associated with the likes of shopping centres and retail parks, and instead come from the thousands of smaller units often on our high streets and in our town centres.
“These same areas are also seeing a reduction in investment due to shrinking retail demand, which means converting units to higher standards of efficiency may be unviable in many circumstances with a significant risk of further stranded assets.”
Savills research shows a clear correlation between retail with the highest voids and least occupational demand and the lowest EPC ratings.
Mark Garmon-Jones, head of shopping centre investment and repurposing at Savills, said: “While it’s no secret that we currently have an oversupply of retail in the UK, this doesn’t mean we can afford to lose more shops simply because they fail to meet energy efficiency standards.
“More intervention will be required to support landlords throughout this process, whether the intention is for the space to stay as retail or if it’s to find life under a different use through repurposing.”
In the longer term, Savills reports that by 2030, by which time all leased commercial real estate must achieve and EPC rating of at least Grade B, a total of 1.4 billion sq ft of retail space needs to be improved. This is 83% of all UK retail real estate.
Nordic real investment manager NREP has teamed up with city mayors group C40 to deliver projects promoting the 15-minute city concept.
The new Green and Thriving Neighbourhoods programme is intended to deliver proof of concept for 15-minute city policies. The 15-minute city concept involves a series of dense, walkable neighbourhoods with mixed uses, essentially transforming cities to become a set of urban villages.
The combination of density, mixed uses and walkability means the 15-minute city should have much lower carbon emissions, as people do not need to regularly travel by vehicle. Compact and resource-efficient cities can help cut urban emissions by around 25%, according to the Intergovernmental Panel on Climate Change (IPCC).
NREP CEO and Partner Claus Mathisen said: “As much as 60-70% of the world’s CO2 emissions come from cities, so the quest for greener urban solutions is urgent. This partnership is an opportunity to shape what a sustainable and equitable city is and to create a blueprint for urban development that will help not only cities to drive ambitious urban policies but also business and other stakeholders to engage and adapt their operational models.”
Strategic partners in C40’s new Green and Thriving Neighbourhoods programme include UN-Habitat and the Sorbonne University's Carlos Moreno, recognised for his work on a framework for 15-minute cities. The programme will deliver projects in at least five cities.
C40 is a network of nearly 100 city mayors, dedicated to addressing climate change and and building healthy, equitable and resilient communities
NREP is an urban investor with assets of €18 billion under management and 600 employees across Europe.
Creating shared value is the corporate mission of one of Hong Kong’s largest developers, conference delegates heard this week.
Interviewed at the UBS APAC Sustainable Conference yesterday, New World Development CEO Adrian Cheng spoke about the long-term approach to sustainable investment and the importance of the S in ESG.
“Investing in sustainable features or sustainability is more on a medium- or long-term horizon. It’s catering to the next generation. Don’t think about it as a shortcut. In the long-term, you will get tangible and intangible value,” he said.
New World is focused on creating shared value for the community, he said. The company has raised more than HK$39 billion ($5 billion) through sustainable finance, from a combination of green loans and bonds, sustainability-linked loans and bonds, and the first green and social dual tranche bond to be offered by a corporate.
Social initiatives from New World include Share for Good, the first city-wide crowd donation platform which matches donors with the underprivileged and Build for Good, a not-for-profit social housing enterprise led by the business sector, which aims to address Hong Kong’s housing and land supply problems.
CBRE has joined forces with proptech firm Negawatt Utility to provide energy-saving tools and consultancy services for asset owners in Hong Kong.
Buildings account for 90% of electricity consumption and over 60% of carbon emissions in Hong Kong and commercial buildings contribute more than 75% of total emissions.
“We are seeing a growing sustainability demand from our landlords,” said Thomas Lam, head of property management at CBRE Hong Kong. “We are excited about our collaboration with Negawatt. Through this partnership, we are proactively realising our vision of building a more sustainable built environment and a greener future in Hong Kong.”
Under the partnership, landlords and occupiers can access Negawatt's web-based platform which uses the Internet of Things, data analytics and AI, to help landlords understand and reduce energy usage.
The real estate industry has been wrestling with its carbon footprint and how to reduce it for some time. However, until recently, the focus has been exclusively on emissions from building operations, such as lighting, heating and cooling.
But operational carbon emissions are only half the story. The construction of any building generates carbon. Making steel, glass and concrete results in carbon emissions. The transport of materials to and from a construction site and the work involved in erecting a building all involve emissions. It is estimated that 11% of total global carbon emissions come from building construction and materials.
Now the industry is beginning to look at the whole life cycle of a building to assess its emissions and it is driving changes in behaviour. Peter Epping, global head of ESG at Hines, says: “We need to be careful about which buildings we are knocking down and whether the benefit in terms of reducing operational carbon over time or other benefits are worth the embodied carbon of building new. No matter how green a building is touted to be, you still spend at least 30 years of operational carbon in its development.”
As building operations becomemore efficient, the embodied carbon in a building becomes more important. The longer a building can be preserved, the more the carbon involved in its creation can be ‘amortised’.
Billy Grayson, executive vice president, centres and initiatives, at the Urban Land Institute, says: “According to most estimates, embodied carbon accounts for as much as half of a buildings’ total carbon emissions over its lifetime. If we can develop strategies to use lower-carbon building materials and construction strategies, we can make significant progress in reducing overall emissions from the real estate sector.”
Projects that attempt to minimise embodied carbon can benefit from green building certification. Many of the major certification systems, including LEED, BREEAM and EDGE, consider embodied carbon.
Earlier this year, a pioneering low-carbon certification programme for real estate was launched in Europe, garnering support from real estate investors such as Ivanhoé Cambridge and Generali Real Estate, as well as the French BBCA association.
Like most exercises in making real estate more sustainable, measuring and assessing a building’s total carbon emissions over its projected life can help developers and investors judge its impact. A whole building life cycle analysis (WBLCA) attempts to account for all carbon sources present throughout a building’s life. Such analysis – while obviously requiring a certain amount of speculation – can give a more balanced picture of a project’s impact and might even sway decisions on whether to embark upon it.
To reduce embodied carbon, the real estate industry needs to embrace the four ‘Rs’: reduce, reuse, replace and recycle, says Grayson. Reducing the raw materials and energy used in the construction process will reduce embodied carbon. This might involve using modular construction to reduce waste and transport emissions, or producing materials on site. Of course, simply creating fewer buildings and instead refurbishing existing stock naturally reduces the use of materials.
Reuse could involve using the materials from the construction of one building for another, or they could be recycled. “Recycling all construction waste and using recycled materials for construction can also have a positive impact on reducing embodied carbon,” says Grayson. Developers are beginning to replace carbon-intensive building materials with lower- carbon or renewable materials, such as timber, lower-carbon concrete and recycled steel.
Such considerations are increasingly tipping real estate investors into refurbishing and improving existing buildings rather than demolishing them and building afresh. Grayson says: “Usually, refurbishment or repurposing of obsolete properties is better than redevelopment, from an embodied carbon perspective.”
However, refurbishment is not always the best option: it might be impossible for a building to be brought to the required specification, for example. As construction becomes lower- carbon, the balance may also swing back in favour of new buildings, especially if the building they replace can be recycled.
Using the four Rs to reduce embodied carbon should also not come at a cost; using less energy and materials in a project tends to mean lower costs. Furthermore, lower-carbon materials are often similar in cost to their standard equivalents, the ULI’s Embodied Carbon in Building Materials for Real Estate report argues. New technology is emerging to help the real estate industry reduce embodied carbon.
Epping says: “It is very encouraging to see considerable innovation in the field of low-carbon construction, whether that is low-carbon cement, low-carbon steel or other materials.”
For example, advances in structural timber are making it a practical solution for large scale commercial buildings, even lofty skyscrapers, while solutions are emerging for concrete which are not just lower-carbon but carbon negative, as the making of the concrete involves storing carbon dioxide.
Throughout a building, the choice of materials will affect its final embodied carbon footprint. “Everything down to the choice of carpets can make a difference. And that’s why we were pushing really to getting environmental product declarations (EPDs) for everything we use in a building, so we can have a ‘carbon P&L’,” says Epping. Environmental product declarations will allow purchasers to weigh up the environmental impact of a product.
Embodied carbon could be further reduced by employing circular economy techniques. The circular economy refers to the constant reuse and recycling of materials to reduce waste, carbon emissions and pollution. This might involve reuse of buildings or the recycling of existing materials into new buildings.
Grayson says: “Circularity teaches us [that] any industry’s waste products should be a feedstock for other industries’ processes, and that we should figure out ways to reduce lifecycle environmental impacts by efficiently integrating different industries in the efficient use, reuse, and recycling of materials.
“If buildings were built from rapidly renewable materials and designed for adaptive reuse and disassembly, it would significantly reduce their life cycle greenhouse gas impact and contribute to the circular use of materials as feedstocks for future buildings and other beneficial manufacturing processes.”
Part of the challenge of reducing embodied carbon is in persuading people to consider it, how to measure it and how to reduce it. “We have seen that introducing this topic into the conversations with architects, designers and contractors means people get up to speed quite fast and act smarter. If you had mentioned this topic two years ago to anyone, they would probably just have shrugged their shoulders and looked for someone else to work with,” says Epping.
Hines has contributed to the debate by publishing an Embodied Carbon Reduction guide, which explains the topic and gives some detail on how it might be addressed by the real estate industry.
And it must be addressed, not least due to the existing and future legislation which is expected for the sector. For example, the Netherlands’ commitment to economic circularity by 2050 involves a requirement that the building sector reduce its raw materials use by 50% by 2030. Since 2013, all new buildings have been required to conduct a whole building life cycle analysis.
As noted in Sustain’s May issue, a number of new-build projects in cities across the world have been rejected, due, in part or whole, to the carbon emissions associated with their construction.
The major push factor for the real estate industry, however, is likely to be the wider implementation and higher cost of carbon taxes. Some 40 countries and more than 20 cities, states and provinces already use carbon pricing mechanisms, with more planning to implement them in the future, in order to shift the burden of climate change onto those who are responsible for it.
For example, in April, Singapore announced it would be revising its carbon tax and raising it incrementally to change behaviour. From 2024, large emitters in Singapore will have to pay S$25 (US$18) for each tonne of carbon dioxide equivalent emitted, increasing to S$45 in 2026 and 2027, and eventually to between S$50 and S$80 by 2030.
Once carbon taxation expands to more countries, developers will have a strong financial incentive to take action and reduce embodied carbon.
ESR is planning to convert a Korean logistics centre to hydrogen-powered operation.
The Asia Pacific investment manager announced that its Korean logistics subsidiary, Kendall Square Asset Management, has signed a memorandum of understanding with SK Plug Hyverse and Coupang Fulfilment Services for the development and operations of South Korea’s first hydrogen powered fulfilment centre.
SKPH is a Korean/US hydrogen joint venture, while Coupang is the subsidiary of one of Korea’s largest e-commerce platforms. They will join forces with ESR to add hydrogen infrastructure to ESR’s existing Mokcheon Logistics Park.
Mokcheon Logistics Park is a 148,000 sq m modern logistics property leased to Coupang and located in Chungcheong province. Liquefied hydrogen storage infrastructure and charging stations will be installed at the property and forklifts will be converted to hydrogen fuel cells.
Thomas Nam, CEO of ESR Kendall Square, said: “We are pleased to announce this MOU as it will enable our tenants to access hydrogen, one of the leading options for storing renewable energy, which is in line with Korea’s ambitious plans to become a global leader in the development of hydrogen projects.”
The initiative could be rolled out to other ESR logistics facilities in Korea.
JLL has promoted Helen Amos to the role of head of sustainability for Hong Kong.
She has over 18 years of experience in the sustainability sector, working for companies including Mace and Cundall before joining JLL in 2020.
Amos specialises in the development and implementation of decarbonisation targets and strategies for both operational and embodied carbon.
Alex Barnes, managing director of JLL Hong Kong and Macau, said: "Sustainability has become an important element in the real estate sector and our clients are increasingly taking a building's sustainability into account in their investment decisions as sustainably operated properties perform better in the long term at both the asset and portfolio levels.”