The ULI's top 5 themes for real estate sustainability in 2024
Regulation, resilience and the bottom line are amongst the factors which will drive the sustainability movement in real estate in 2024, the Urban Land Institute says.
This week, the ULI launched its ULI Global Sustainability Outlook 2024 report, which highlights five sustainability themes which are expected to affect real estate decision-making in the coming year.
The ULI Randall Lewis Centre for Sustainability in Real Estate, in partnership with sponsor Ferguson Partners, convened a series of roundtables with real estate sustainability leaders from the Americas, the Asia Pacific, and Europe. The insights from the roundtables were distilled into five key priority areas for 2024.
- Linking sustainability performance and financial performance. As industry stakeholders take an increasingly sophisticated approach to ESG topics, real estate companies can expect to see material connections between their sustainability efforts and financial performance. Accessing capital in 2024 and beyond will require real estate companies to demonstrate how far along they are on the path to decarbonization, and how they will achieve their ESG goals.
- Going back to basics to advance decarbonization. The sheer volume of topics under the ESG umbrella have left companies feeling overwhelmed and unclear on what to prioritise. To make real progress, real estate leaders should focus on fundamental sustainability practices, such improving the operational efficiency of assets.
- Complying with an evolving regulatory landscape. Real estate stakeholders faces major changes in sustainability reporting frameworks, which are making disclosures mandatory and establishing systematic methods for transparently reporting on ESG performance. Regimes such as the Corporate Sustainability Reporting Directive (CSRD) in Europe, the International Sustainability Standards Board’s inaugural sustainability disclosure standards (IFRS S1 and S2), or local policies such as Local Law 97 in New York will put pressure real estate companies.
- Prioritising resilience as extreme weather intensifies. As extreme weather events increase in frequency and severity, real estate leaders across the globe are increasing efforts to better understand and mitigate the impact of climate-related hazards on assets. In particular, the resilience of the utility grid is a growing area of concern as weather events diminish reliability at the same time as the industry’s electrification is increasing demand.
- Approaching sustainability holistically. Emerging pressures from investors and tenants alike are driving real estate firms to think holistically about sustainability and integrate human health and nature, in addition to climate, in their efforts.