For some, it’s not easy going green

SYDNEY, 7 March 2023 – Despite the number of large companies making climate commitments reaching critical mass, and governments legislating to cut emissions, the real estate sector is still confused about net zero carbon targets and how to achieve them.

JLL’s recent podcast, ‘Why real estate is confused about sustainability’ discusses why measures to limit real estate’s environmental impact are gathering pace, but some managers are struggling to keep up.

JLL’s Tenant Representation – NSW, Senior Director, Anthony Clark said, “There is a fundamental lack of understanding as to basic concepts and principles. A lot of people don’t understand the difference between carbon neutral and net zero carbon.”

“Becoming carbon neutral is about measuring your emissions and then finding ways to offset them. But net zero means truly reducing carbon emissions. It’s about changing your business behaviours and practices, reducing your emissions across the entirety of the value chain, and only using offsets as an absolute last resort,” said Clark.

Businesses are still coming to terms with the impact on their carbon footprint of staff working remotely and may not fully realise the extent to which workers at home are still contributing to their overall emissions.

Mr Clark said, “A business in the post-pandemic world might think that if they skinny their footprint down to 8,000 square metres from 10,000 they're making net savings.

“Many businesses don’t realise that if you have employees working from home, those emissions form part of the business’s scope three emissions. It starts to add up very quickly,” said Mr Clark.

Measuring carbon emissions and input is a consistent challenge for the real estate industry.

JLL’s Head of Sustainability – ANZ, Connor McCauley said, “You can’t manage what you don’t measure. Shared, accurate data between landlord and tenant is the key to net zero solutions, but currently lacking.”

Another challenge is the perceived cost of carbon solutions, including technology. However, running a simple audit as a first step can be revealing.

Mr McCauley said, “While energy prices and waste collection costs have gone up, the cost of an audit hasn't. It’s a small investment that helps you see where savings can be made.

“Not carrying out an audit can be costly. Waste contractors were still emptying commercial bins based on contracts drawn up pre-pandemic when offices were busier. People are working from home and there hasn’t been as much waste, yet the same number of bins are still being collected and businesses are paying the same price - sometimes for an empty bin,” said Mr McCauley.