By Cindy Zhu

This year’s Greenbuild International Conference and Expo saw continuation of the “health and well-being” theme as related to the built environment and its impact on occupant health and productivity. The message resonated with the commercial real estate sector in particular, with interest spanning from institutional investors making considerations for large-scale development and infrastructure, to property owners and managers of multi-tenant residential communities.

Global investors are big influencers of real estate trends, and many have begun to recognize the growing prominence of socially responsible investment strategies that value financial return and social good. Taking note of this shift toward a three-pronged corporate sustainability approach is the Global Real Estate Sustainability Benchmark (GRESB), an industry-driven organization committed to assessing the environmental, social, and governance (ESG) performance of real estate assets. GRESB’s annual reporting platform provides data that is leveraged by more than 200 members to inform their investment management process ensuring the optimization of risk/return profiles of their respective portfolios. The public sharing of ESG indicators serves as a mechanism to influence competition between companies as the driving force for “moving the needle” toward sustainable investments.

The relevance of nonfinancial performance indicators like ESG is indicative of the market shift toward acceptance of the idea that health and sustainability go hand-in-hand. This trend has begun to extend from wellness in buildings and the workplace to the community level. Speaking at the Investing in Large Scale Development and Infrastructure session moderated by Nils Kok, CEO of GRESB, the role race plays in the disparity in levels of sustainability and condition of the built environment in lower income communities was described David Erickson, director of community development at the San Francisco Federal Reserve. Concentrations of poverty and violence coincide in areas with the highest levels of environmental degradation with populations that have persistently struggled with energy costs that often account for a significant portion of their income, and lack of resources for efficiency upgrades. These communities face increasing social and chronic health issues, which require solutions that implement inclusive design and construction strategies, and work to ensure that the most vulnerable populations are not left behind as climate change impacts become a reality. To meet this need, the SF Federal Reserve and the Natural Resource Defense Council (NRDC) have partnered together on the Strong, Prosperous, Resilient Communities Challenge (SPARCC), a three-year, $90 million collaborative effort to capture the opportunity of new investments in transit, infrastructure, climate resilience, and health so that communities at all socioeconomic levels can benefit.

Consumers are also taking note of the properties that provide luxury amenities that align with their desire for “green” living spaces, prompting property managers and leasing agents to learn how best to communicate the availability and benefits of these features. During the Multifamily Utility Cost Reductions: A Recipe for Success session, Mike Zatz of the Environmental Protection Agency (EPA) and Don Anderson, chief sustainability office at the Blackstone Group, were on hand to discuss both energy efficiency tools, like the EPA’s ENERGY STAR Portfolio Manager, and how to achieve resiliency in multifamily buildings. Leveraging little-to-no cost energy conservation strategies was emphasized as a means to actualize energy cost savings and efficiency improvements without a substantial upfront investment.

All facets of the real estate market appear to be leaning into the acceptance of sustainability as a marketable, and profitable, business strategy. As shown through the presence of residential and commercial sector representatives in Greenbuild sessions, we can expect a progressive shift toward a built environment that incorporates health and well-being from inception to creation in the future.