A Framework for Sustainable Real Estate Decision-Making and Assessment

Since the 1970s, we have seen a significant change in the attitudes of the society, governments and the business community toward sustainability measures and regulations. Most recently, the real estate industry has struggled through the mortgage crisis and the global financial crisis resulting in the emergence of a new period in which the real estate industry is addressing sustainability issues using a more holistic, systems approach. Companies are no longer adopting sustainability concerns solely for reasons related to social good; instead, they are focusing on how to prove to their stakeholders that they are focused on sustainable property performance and management - and that sustainability-related initiatives are positively impacting their bottom-line.Current market conditions have forced companies to address market uncertainties, and industry leaders are using sustainability initiatives as a means of managing risks and meeting the requirements of a market in transition. Companies are increasingly judged not only by the corporate social responsibility values, as reflected in their CSR statements, but also by the actions through which those values are actualized and how these actions impact their financial stability. This also extends to how companies make decisions about sustainability initiatives for their real estate assets. These market changes have resulted in new strategies for decision-making and assessment of both specific sustainability initiatives and sustainable real estate. Simons, Slob, Holswilder and Tukker noted that more complex and more integrated strategies will be needed to deal with the new societal challenges now associated with sustainability.