ESG

The pressures on biodiversity are increasing, making it critical for the real estate industry to consider its impact, particularly across the Asia Pacific region where Southeast Asia alone hosts nearly 20% of the world’s known species within just 3% of the global land area.

Biodiversity contributes significantly to the functioning of ecosystem services such as clean air and water, climate regulation and disaster risk reduction which are essential for human well-being and economic stability. However, this is threatened due to this region’s rapid urbanization, deforestation, and agricultural expansion. For example, air and water pollution are the highest environmental risks that urban Asian cities face, with air pollution being the cause of one in five deaths in India in 2019, resulting in economic losses of USD 36 billion.

Driven by growing investor concerns and the need for robust ESG disclosures, regulatory trends are increasingly focusing on biodiversity. Initiatives like the UK's Biodiversity Net Gain (BNG) and the emergence of frameworks like the Taskforce on Nature-related Financial Disclosures (TNFD) are putting pressure on companies to disclose their environmental impacts and demonstrate how they are contributing to nature conservation.

The real estate sector, a significant contributor to biodiversity loss through land use, consumption of raw materials and disruption of natural cycles, is central to this shift. An upcoming white paper developed by CBRE in collaboration with Nature Positive and the Metis Institute acknowledges this and aims to explore the feasibility and benefits of incorporating biodiversity into green leases in Southeast Asia. Green leases serve as an important link between landlord and tenants on the sustainable objectives of a building, and including biodiversity within would help to integrate both party’s interests.

The white paper acknowledges several challenges when addressing biodiversity risks. Adoption and support for nature-based solutions is low due to weak legislation, lack of awareness, and maintenance difficulties . Additionally, the intangible benefits of nature-based solutions make it hard to justify the capital investments.

Despite these challenges, the real estate sector has a unique opportunity to turn the tide. By integrating biodiversity into urban development, the industry can enhance urban resilience to climate change effects, such as flooding and heatwaves, improving business continuity and urban liveability.  Furthermore, properties that incorporate green spaces and biodiversity measures often see increased market values, as investors are attracted to the operability and resilience of the building, along with higher tenant satisfaction.

While the path forward is fraught with challenges, the potential benefits of addressing biodiversity risks present a compelling case for action within the real estate industry.

To get started, the real estate industry can consider the following actions.

Prioritising biodiversity should be a necessity in sustainable urban development in Asia Pacific before it is too late to salvage local ecosystems. By setting clear targets, engaging stakeholders, fostering collaboration, and prioritising quick wins, the real estate industry can play a crucial role in preserving the region's rich biodiversity while reaping significant economic and social benefits.

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Environmental sustainability has taken on increased global significance in recent years, with an increased focus on climate resilience and net-zero carbon (NZC) strategies. This is particularly relevant to the real estate industry as it seeks to future-proof real estate portfolios using effective climate risk management strategies. Environmental sustainability issues are equally applicable in both the developed and emerging real estate markets.

This report focuses on net-zero carbon strategies for real estate in India. We conducted interviews with leading players in India’s real estate industry. This enabled in-depth understanding and insight into the critical issues for achieving net-zero carbon in India and identified the most effective pathways forward for real estate. Many of the issues concerning India are equally relevant to other emerging markets in Asia, so this report should also appeal to a wider audience.

This study evaluates key barriers, challenges, and opportunities in the adoption of NZC and recommends strategies for the low-carbon transformation of India’s real estate sector.

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Globally and especially in Singapore, the race to Net Zero has long begun. Like running any race, the motivation and plan must be clear. This paper lays out the urgency and steps to win this race for both commercial real estate owners and occupiers.

Net Zero buildings enhance resilience to energy supply disruptions and reduce dependence on fossil fuels. Although there may be initial costs, long-term savings through reduced energy expenses and increased property value are significant benefits. Net Zero buildings also offer a healthier and more productive environment for tenants, leading to higher occupancy rates and rents.

Finally, a couple of case studies demonstrate the potential savings for typical landlords and occupiers in the commercial space from optimising energy use (without additional capital expenditures) through simulation-based solutions; adopting the smart scheduling of energy use can lead to substantial cost and emission reductions.

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The climate impact of the real estate sector cannot be understated, with buildings contributing nearly 40% of global carbon emissions. Asia, home to over half of the world’s urban population, plays a critical role in this equation, with the region’s emissions projected to increase as urbanization and development accelerate. 

With approximately 70 billion square meters of real estate expected to be developed in Asia over the next two decades, the region has the potential to not only reduce emissions but to set new standards in sustainable urban planning and construction.

Key Decarbonization Strategies for Asia:

1. Limiting Urban Sprawl: Urban expansion in Asia has often led to low-density developments, resulting in higher emissions due to increased infrastructure demands. Cities can mitigate these impacts by focusing on high-density, mixed-use developments, creating efficient urban spaces that minimize transportation needs and reduce the overall carbon footprint.
   
   
2. Sustainable Construction Practices: The materials and processes used in construction have a significant carbon impact. By adopting innovative materials and techniques, such as using greener concrete mixes, and integrating supplementary cementitious materials, developers can dramatically cut emissions. For example, certain concrete mixes can reduce carbon emissions by up to 40% compared to traditional materials.
   
   
3. Carbon Capture and Storage: Emerging carbon capture technologies offer promising solutions to reduce emissions from the manufacturing of construction materials. Though still in early stages, these technologies have the potential to significantly cut emissions if adopted at scale.
   
   
4. Advanced Data and AI Solutions: Accurate data tracking is essential for effective emissions management. Technologies that integrate data from utility bills, smart meters, and Building Management Systems enable real-time tracking and smarter energy management, reducing emissions tied to building operations.

 

A Path Forward for a Sustainable Asia

The decarbonization of Asia’s built environment represents both a challenge and a $47 trillion economic opportunity, driven by the need to align with global climate goals while catering to the unique demands of the region. Achieving this requires a targeted approach, one that equips developers, investors, and policymakers with strategies that balance sustainability with Asia’s rapid growth.

 To dive deeper into these strategies, download the whitepaper “From Concrete to Carbon Neutral: Decarbonizing Asia’s Built Environment”.

 

 

 

 

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