„Investors increasingly view sustainability as critical to preserving the long-term value of their assets. As regulations tighten, real estate players must embrace the transition to more sustainable buildings to remain competitive. Whether it's introducing renewable energy or adopting new technologies to measure building performance, the goal should be to add tangible value to real estate portfolios, increase asset liquidity and meet stakeholder expectations”. That's the view of Damien Harrington, head of market research and capital markets, Colliers , who commented on the company's latest report for the Europe, Middle East and Africa region - Realizing ESG Performance. It contains useful information on how the real estate industry can integrate sustainability standards and relevant regulatory requirements while creating long-term added value< /p>
The adoption of smart technologies will be at the heart of this transformation, providing the data-driven insights needed to meet regulatory and market demands and improve sustainability metrics in real-time. “Technology is the key to unlocking the potential of ESG in real estate,” said Andy Mercer, Head of ESG at Colliers. “Smart building systems, renewable energy installations and data collection tools are indispensable for optimizing resource use and achieving ambitious sustainability goals. These strategic investments can deliver significant ESG results.“
The report highlights that this will often be a flexible and iterative process, progressing gradually, and collaboration between building owners, tenants and service providers will be key. „ESG in real estate is no longer just about regulatory compliance,” explains Sam Addison, Head of Project Management, Occupier Services, Colliers EMEA. “The focus must be on achieving long-term value through collaboration and strategic, incremental change. Incremental improvements allow property owners to spread the cost of ESG investments while realizing immediate savings. Small steps lead to significant increases in sustainability and asset value. Our report provides property managers with a blueprint for achieving these goals without significant upfront investment.“
The main recommendations for the real estate market include:
- Incremental transformation steps: Making small, targeted improvements such as optimizing building systems and reducing boiler temperatures to achieve long-term sustainability.
- Invest in measurement and transparency: Invest early in monitoring tools and building management systems to track energy use, identify areas for improvement and ensure compliance.
- Contextual ESG strategies: Adapt sustainability strategies to the specific location, taking into account infrastructure and renewable energy opportunities.
- Beyond energy efficiency: Beyond achieving energy efficiency, focus on reducing carbon emissions, reducing waste and improving air quality for a better environmental profile.
- Accept limitations and opportunities for exit strategies: Accept that some assets cannot meet higher standards and develop exit strategies to strengthen your overall investment portfolio.
- Using best practices: Use proven frameworks like the ESG Playbook and collaborate with experts to ensure sustainability investments will increase property values.
- Focus on collaboration: Align ESG strategies by working closely with tenants, investors and service providers, setting common goals and effectively implementing sustainable development practices.
- Invest in smart technology: Integrate smart systems and renewable energy technologies for real-time monitoring, energy optimization, emissions reduction and ESG compliance.
- Incremental retrofits: Manage retrofit costs with incremental upgrades, starting with impactful changes like LED lighting and HVAC upgrades.
- Prioritize regulatory compliance: Ensure properties meet evolving ESG and energy efficiency standards to avoid penalties and ensure long-term asset viability.
You can see detailed statistics on average property prices in Bulgaria by cities and neighborhoods HERE