Did you know the “built environment” (re: real estate) is responsible for 40% of direct and indirect carbon emissions? With that strong of a negative impact, we (as real estate leaders) have a heavyweight on our shoulders to do everything we can to be less of the problem, and more of the solution.
According to the U.S. Department of Energy, commercial buildings account for 18.7% of energy usage, 40% of CO2 emissions, and a whopping 88% of potable water consumption in the United States. This energy usage isn’t specific to a certain asset class either – timber, self-storage, hospitality, office, retail, industrial… all of these sectors are negatively impacting the carbon footprint primarily by the high cost of extracting water from natural sources.
Let’s take a look at an office building’s energy consumption. On average, a large commercial building uses about 22,000 gallons of water per day! On the electrical side, HVAC units usually take up about 40% of your electricity consumption. On top of that, you’ve got lighting, internet, high-power computer systems, and security sensors just to name a few. While there’s a lot going on with offices, they pale in comparison to the carbon footprint an industrial/manufacturing building makes.
Aside from the day-to-day operation of a large corporate building, think about all the raw materials builders use in the construction process. The gasoline, electricity, timber, water, stone, etc. consumed to build a 200,000+ square foot building are nearly immeasurable.
All that to say, corporate real estate is definitely impacting the environment. While we haven’t quite figured out how to build a facility without those resources, we can be conscious of the resources we choose and how/who they’re sourced from. While it may seem daunting, companies who aren’t actively investing in sustainability practices are missing a new core component of business strategy. So, what can you do?
You may be wondering if there are any benefits of sustainable corporate real estate (other than protecting the environment) to your organization – and the short answer is a resounding yes.
To get the ball rolling, the first thing you should do is talk to your facilities team to take stock of your energy usage. This typically includes the average gross kWh (kilowatt-hour) of electricity and your CCF (centum cubic feet) of water consumption. If you just have one building, this is easy to find on your energy bills – but for those of you with large corporate real estate portfolios, wrangling all that data might require a bit of a lift.
Once you have a general idea of your energy consumption, think about which inputs have the heaviest impact. Are your HVAC units outdated (using propane or oil) and not operating as efficiently as a geothermal system? On that note, are you heating/cooling your buildings outside of working hours? If you aren’t able to do a full HVAC rehaul right now, you can install timers that decrease the heating/cooling output when your team isn’t in the building. Timers and even changing the normal running temperature (based on the weather) by a couple of degrees will drastically decrease your energy consumption.
Speaking of timers, what about your lights? If you’re like me and your parents drilled into you the importance of turning off the lights/TV when you leave a room, why not operate your facilities the same way? Installing motion sensors in each office/room that only turn on the lights when they’re occupied is a painless and cost-effective way to cut back your usage.
Let’s circle back to the data I mentioned earlier. There’s going to be a lot of it. Even with a smaller real estate portfolio, the variables that go into the energy usage of a property are overwhelming. Validating and standardizing those data points is a job in and of itself – which is where a software solution comes into play, saving your team time and money.
RefineRE’s ESG module is a great place to start. We take the heavy lift-off corporate real estate teams by analyzing and benchmarking carbon footprint and emissions data by taking the electrical spend by property from your dataset. Then, we guide you on the roadmap to decreasing your carbon footprint (ideally getting to net-neutral depending on your goals).
We did just that for a large tech company with ambitious ESG goals, but a loose understanding of where they stood relative to their carbon emissions. Our ESG module identified the costs and time associated with developing a carbon-neutral corporate real estate portfolio within 15 days – a small fraction of the timeline they realized they would need if executed internally.
Working through an ESG initiative is no small task and will require more up-front costs than sticking with the status quo, but employing these measures will save your bottom line (and the environment) in the long run.
Contact us to fuel sustainable growth for your organization.