Buildings are the biggest polluter out there. Energy use in real estate accounts for more than 40% of Europe's CO2 emissions. But now that many companies have a CSR or sustainability policy defining their response to climate change and setting out what they are doing to minimise their negative impacts, the corporate real estate (CRE) team is given an irrevocable licence to go out there and do something. The real-estate sector thus has a chance to lead the field. Yet many CRE teams are nowhere near ready.
The CSR approach does not have to be more expensive but needs to be thought through. More efficient use of space, a careful choice of office equipment and new policies can have a real impact on the carbon footprint of the workplace. With an increased awareness of the issues and the prospect of shareholder backlash, it will soon become unacceptable to many corporates to occupy buildings that, from a CSR standpoint, fail to offer for the life of their lease certain features. Our guidelines - the three Es of good environmental behaviour - should help you to maintain a sustainability policy at all points in the life of a lease.
1 Entering into a new lease
The first stage of an acquisition, the market survey, should incorporate questions about the environmental impact of the buildings. The CRE team should check that the workplace in question has a BREEAM or LEED certificate. Both certifications score the building's impact on the environment.
The second task is to request information from landlords. Here, more detailed questions can be asked about their buildings and their approach to sustainability. Such questions would cover: water use, waste recycling, energy use, building systems and environmental policies, material usage and procurement routes.
Once the lease is signed on an environmentally friendly building (with clauses to ensure this continues for the length of the occupancy), demolition of the existing fit-out and new space design and construction must be give careful consideration. When arranging demolition before occupancy, choose a contractor who will recycle materials and office equipment. The new office fit-out follows the same approach: use recycled materials and fixtures and fittings to ensure that the building systems are run to maximum effect. As part of the design and fit-out, allow space for recycling bins.
2 Existing space
The company now has an environmentally friendly and energy-efficient building. An internal recycling awareness campaign will ensure that everyone participates. The facilities management team collect data on energy use, recycling and so on, and this is communicated to staff to encourage continuing good practice. These figures demonstrate, too, a programme of improvements that will have direct impact on shareholder value. Senior management will see an improvement not only in carbon-footprint reduction but also in the cost line in every P&L across the company.
It is the firm's and CRE team's responsibility - as much as the landlord's - to spend time developing ways to improve building systems so that space can be run in an efficient way. This new way of working will be the best means of unlocking the potential that both parties seek.
3 Exiting space
A lease may come to an end but the cycle continues. Any removal of fixtures and fittings by a tenant needs to be done with recycling in mind, and choosing contractors who will do this is a must. The landlord needs to make good and take the opportunity to ensure that the space is brought back to a condition that allows the next tenant to meet its CSR goals.
This is not the way things have traditionally been done and is not the norm in 2007. But applying CSR precepts to the world of property is helping to drive down that 40% contribution to CO2 emissions. Seriously reducing real estate's carbon footprint could also change business by breaking landlord/tenant barriers.