Review of the real estate sector
EXECUTIVE SUMMARY
Real estate companies, as financial actors, play a key role in the building ecosystem. As such, they are witnesses to the ecological challenges of this sector, but also players in the transition of the building industry.
Worldwide, the building sector (existing buildings and construction combined) consumes 36% of the final energy consumed and emits 37% of the world's CO2 emissions. The transition of the sector is therefore a necessity, which is increasingly reflected in regulations: in France alone, the tertiary sector decree imposes energy savings on part of the existing stock, and the environmental regulation, applied from January 2022, will impose thresholds throughout the life cycle of construction projects.
Real estate companies, as managers of property assets but also as property developers, have a major role to play in this transition, especially since their economic weight is considerable.
The climate performance of real estate companies as managers is highly dependent on their portfolio of real estate assets. Indeed, the uses of each building, as well as their location, largely determine the performance of real estate companies. However, this should not take the responsibility away from the managers, who can and should activate several levers to reduce the intensity of their portfolio. Real estate companies can act on the energy efficiency of their portfolio (through energy efficiency in use or through renovation), but also on the energy mix used by their buildings.
As for their real estate development activities, real estate companies do not seem to be aware of the major role they could play as project managers. They are not transparent enough about the energy performance of the buildings they promote, nor about the materials and construction methods used in the buildings. Yet builders - and therefore the real estate developers who place the orders - can act as levers of transition in the three dimensions of reducing induced emissions, increasing emissions avoided by customers and sequestering emissions.