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The View | Why Asian commercial real estate is embracing a green, sustainable future
- Landlords, occupiers and investors all face greater scrutiny of their sustainability plans as the shift towards a zero-carbon economy gains momentum
- The drive to decarbonise has not taken root in Asia to the degree it has in Europe and North America, creating an opening to capitalise on the shift
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For environmental campaigners, the Covid-19 pandemic is a crisis that must not go to waste. The devastation wrought by the virus has provided a fresh perspective on climate change, ushering in a new era of heightened social responsibility as governments, businesses and individuals come under mounting pressure to reduce their carbon footprints.
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With the built environment responsible for about 40 per cent of all carbon emissions, commercial property landlords, occupiers and investors face greater scrutiny on the adoption and implementation of their sustainability initiatives.
Asia is the focal point for measuring progress in reaching net zero emissions, given that the region consumes around three-quarters of the world’s coal. The fossil fuel generates more than half of China’s electricity and as much as three-quarters of India’s.
The pandemic has provided a fillip to the sustainability agenda in Asia. The findings of a survey published by JLL in June revealed that two-thirds of occupiers and half of investors polled across the region had incorporated emissions-reduction targets into their sustainability strategies.
Moreover, a majority of respondents said employees would demand green and sustainable spaces in the future and, more tellingly, accept that climate risk posed a financial risk.
It is the latter concern that is concentrating the minds of landlords and investors. Pressure from capital markets for companies to be seen to be ethical – as well as greater recognition of the value generated through adopting green strategies and the costs in not taking environmental risks seriously enough – have catapulted sustainability to the forefront of Asian commercial property occupier and investment strategies.
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