 "green buildings")
The real estate sector, a significant contributor to global greenhouse gas emissions, has begun shifting towards more sustainable and green options. The "Sustainable real estate: An opportunity to leverage" report by KPMG in India and Colliers finds that more developers are shifting towards green and sustainable real estate, focusing on long-term gains despite increases in costs. The report finds that green buildings can lead to 35 per cent reduction in emissions and 20 per cent reduction in maintenance costs. Here are the highlights of the report.
Building & construction make up 40 per cent of global CO2 emissions
Around 40 per cent of global CO2 emissions come from building and construction. India's share of global CO2 emissions sits at 7.3 per cent as of 2021. This means the real estate sector's shift towards a more sustainable solution could contribute significantly to India's target to reduce the emissions intensity of its gross domestic product (GDP) by 45 per cent by 2030.
Speaking with 32 companies, the Colliers-KPMG survey found that more than 50 per cent indicated that sustainability was a high consideration in their projects, and 94 per cent could see an increase in valuation with green buildings. This is significant as greenhouse buildings could lead to a 35 per cent reduction in emissions and a 20 per cent reduction in maintenance costs.
83 Per cent growth in green office stock in 2023
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In 2023, the office real estate market witnessed a significant shift towards sustainability, with 83 per cent growth in green office stock compared to 2016. Moreover, 61 per cent of India's office market stock was also green this year. The top 10 office micro markets in India, including Bengaluru, Hyderabad, Chennai, and Navi Mumbai, account for 62 per cent of the country's green building stock.
Sustainability initiatives taken by developers
Green buildings: Green buildings are becoming prevalent, integrating bioclimatic architecture, cool roofs, and waste-hauling systems. Buildings with sustainable elements can reduce the energy used in heating the interior by five per cent during winters and cool them down by 33 per cent in summers. Moreover, they can reduce emissions by 35 per cent and cut maintenance costs by 20 per cent.
Innovative construction techniques: Developers are adopting low or zero-carbon construction methods, incorporating local and recyclable materials to minimise environmental impact. Retrofitting ageing buildings is also gaining momentum, promoting both economic prosperity and ecological restoration. Even old buildings retrofitted with green amenities can cut down operation cost by 10 per cent in one year.
Energy efficiency and green technologies: The industry is leveraging energy-efficient heating, ventilation and air conditioning (HVAC) systems, advanced glass technologies, lightning harvesting, and AI-driven smart systems to optimise building operations. The deployment of renewable energy resources, such as solar panels, is reducing carbon emissions and enhancing energy efficiency.
Green building certification: There has been an increase in demand for green-certified buildings, with developers embracing rating systems such as LEED, GRIHA, and WELL, by aligning their projects with sustainable practices. The number of green-certified buildings have seen a five-fold increase since 2010, with 61 per cent of India's total Grade A office stock being green-certified. Bengaluru, Chennai and Hyderabad hold the highest share of green-certified buildings.
Focus on occupant wellbeing: Occupiers are prioritising spaces equipped with green areas, spa and meditation zones, art studios, and yoga gardens, fostering a holistic approach to wellbeing and sustainability.
Cost Considerations
While green buildings have an additional cost of 5-15 per cent compared to conventional structures, long-term benefits and lower operational costs make them a sustainable choice. Factors such as design, materials, and operational efficiency play a vital role in cost considerations.
