Seven real estate industry associations are collaborating to create a carbon pricing strategy for the real estate sector to help combat climate change.
The Urban Land Institute (ULI), the European Public Real Estate Association (EPRA), the Global Real Estate Engagement Network (GREEN), the European Association for Investors in Non-Listed Real Estate Vehicles (INREV), the Institutional Investors Group on Climate Change (IIGCC), the Royal Institution of Chartered Surveyors (RICS) and the World Business Council for Sustainable Development (WBCSD) have announced a new taskforce to develop a pricing strategy that 鈥渢akes a value chain perspective and enables pricing to be incorporated into investment decision making and accelerate its adoption鈥�.
The taskforce is emerging from ULI鈥檚 C Change programme set up in late 2021 by a group of real estate players to mobilise the industry to accelerate the decarbonisation of the built environment across Europe.
A series of workshops will be organised this month aimed at understanding and implementing internal carbon pricing.
Lisette van Doorn, CEO of ULI Europe, said: 鈥淩eal estate is the second-largest contributor of carbon emissions globally, and so industry wide collaboration is essential for us to jointly develop standards and find solutions we need to tackle climate change.鈥�
She added: 鈥淲hile an important tool to help build the business case for low carbon solutions, a recent ULI C Change survey demonstrated that internal carbon pricing is still a 鈥榤inority activity鈥� in the built environment.
鈥淟ack of knowledge and consistent data, including financial and educational, were identified as the main barriers to implementation. And that鈥檚 why education will play an evenly important role in this programme as the co-creation of a strategy.鈥�
Hassan Sabir, finance and ESG director at EPRA, said, 鈥淐ollaborating with all actors across the entire value chain of the real estate industry to introduce a carbon pricing as a mechanism for lowering emissions of buildings may prove to be one of our biggest opportunities 鈥� through which we could collectively make a real difference in the transition towards a low carbon economy and help create the sustainable future we all urgently need.鈥�
Vincent van Bijleveld, director at GREEN, said: 鈥淭he built environment is lagging in integrating carbon pricing in financial decision-making, while taking this into account is simply good business risk management given the long-term nature of real estate and the likelihood of future regulatory changes.
鈥淭his initiative aims to ensure that carbon pricing is firmly placed as an actionable item on our industry鈥檚 collective agenda.鈥�
Lonneke L枚wik, INREV鈥檚 CEO, said: 鈥淎s a collective initiative, the new taskforce is a potential game-changer for the real estate industry. It aims to create a level playing field and enable informed decision making in pursuit of both environmental and investment goals.鈥�
Hugh Garnett, investor practices senior programme manager for real assets at IIGCC, said: 鈥淭he development of an industry wide approach to carbon pricing will assist investors to manage climate-related risk and drive investment into sustainable buildings to decarbonise the real estate sector.鈥�
Justin Young, CEO of RICS, said: 鈥淩ICS has a particular focus on providing practical support to the built environment sector. Creating a carbon pricing framework for the real estate industry is another vital tool to ensure investment is being driven into sustainable buildings.鈥�
Roland Hunziker, director of built environment at WBCSD, said: 鈥淪ustainable transition in the built environment requires mobilising financial resources to close the investment gap the sector faces. We must halve emissions by 2030 and reach net zero by 2050.
鈥淐arbon pricing can be an effective tool to help achieve these goals, and this important initiative, aligned with the market transformation action agenda, will ensure a consistent and coordinated approach across the entire built environment value chain.鈥�
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