Contemporary Mountain Home
Building Envelope: High R-Value Insulation
Contemporary Mountain Home
Building Envelope: High R-Value Insulation
There are numerous trends that are driving the demand for positive social impact developments in our communities. Too many of our community’s essential workers and neighbors are finding it difficult to find quality affordable housing and frequently have to live outside the communities they work in. Additionally, shifting consumer behaviors in real estate, demographic trends and land use policy is both a challenge and an opportunity for positive social impact real estate projects including:
Healthcare Real Estate
Employment: Secure Stable Meaningful Jobs
Our communities need teachers, firefighters, police officers, municipal employees, health care workers, contractors, landscapers, and retail salespersons, to list just a few essential service workers. Unfortunately, many of our communities fail to ensure that such workers have safe, affordable housing opportunities within a reasonable distance from their work. Some community residents not only passively accept this reality but also actively oppose proposals to provide such housing. Their opposition to the local development of affordable housing may not serve the self-interest they believe they are protecting.
Furthermore, it is not only a community’s essential service workers who stand in need of affordable housing. The market for affordable housing is diverse and does not correspond with many people’s outdated stereotypes about who lives in affordable housing. People in all stages of the life cycle need such housing. The adult children of community residents who are just starting out in their careers need affordable housing options. The parents of residents, who may be on a fixed income, might need low-maintenance, affordable housing. Disabled people, including veterans who suffered injuries that have affected their ability to work, need and deserve safe and affordable housing.
Community-focused, “social impact real estate” projects seek to deliver appropriate risk-adjusted returns to investors, lenders, and funders, as well as long-term value creation for all stakeholders (defined in different ways by each stakeholder), while additionally producing worthy, significant, and measurable social benefits to users of the real estate, the local surrounding community, the public, and the environment. Responsible real estate development is a “People Focused, Community-Centric”, with planetary priorities, approach to real estate development.
Positive Environmental Impact
The real estate sector uses more energy than any other sector and is a growing contributor to CO2 emissions. As reported by the World Economic Forum’s Industry Agenda Council on the Future of Real Estate & Urbanization, which brought together a wide range of representatives from the real estate industry, as well as city governments and academia. They were united in a common interest in the real estate industry and concern about the impacts of climate change and the environment on the future development of cities and the built environment.
3 Biggest C02 Contributors
Although measurement is complex, most estimates suggest that the real estate sector is the single most significant sector in terms of CO2 contributions.
The sector consumes over 40% of global energy annually
20% of total global greenhouse gas emissions originate from buildings
Buildings use 40% of raw materials globally
There is a projected 56% increase in building CO2 emissions by 2030
Since most building-related carbon emissions come from energy use, the first—and easiest—step in addressing emissions is reducing consumption through energy-efficient design. The next is replacing fossil fuels with on-site carbon-free renewable energy, then off-site renewables—a taller order since that means addressing our energy infrastructure. The final, and least preferred option, according to the WRI, is purchasing carbon offsets.
An energy efficient building could be a brand-new structure or an existing one retrofitted with new mechanical systems, heating, cooling, and lighting. In the United States about 95 percent of all buildings are more than a decade old and 82 percent of all commercial buildings were built before 2000. Meanwhile, about half of the floor space of all buildings in the U.S. is heated by burning fossil fuels onsite. Retrofits and renovations will be a crucial part of decarbonization.
Decarbonization could resemble a net-zero building, meaning that it produces renewable energy onsite and delivers as much energy to the electric grid as it uses. Taking it one step further is a net-zero carbon building, meaning that it produces as much power as it consumes annually, and the power comes from carbon-free renewable energy sources onsite or nearby. A net-zero carbon building, including embodied carbon, means that the building produces enough renewable energy to meet operations annually and offset the carbon emitted from construction.
How is the building sector already reducing carbon emissions?
Leaders in the architecture and building industry are exploring ways they can make a difference—work that has been going on for many years through certification programs like LEED, Energy Star, Passive House, and the Living Building Challenge. Architecture 2030, a group established in 2006, is working toward net-zero emissions in the building sector by 2050 through the publishing of educational materials as well as consulting with architects, policymakers, financial institutions, and governments.
C40, a network of cities committed to addressing climate change, is pursuing net-zero carbon in all new buildings by 2030 and all buildings by 2050. Last year, the U.S. Green Building Council launched LEED Zero, a new program to help designers achieve zero net energy in their structures. While the various green accreditations available to developers move environmental impact projects forward by no means is accreditation necessary. Some of the most impactful sustainable and responsible buildings use the rules in these accreditations as guidelines to move their projects in a more sustainable direction.
Positive Economic Impact
Responsible real estate development projects deliver risk adjusted economic returns for investors, funders, and clients, and social impact for space users, the surrounding community, the public, and the environment.
Responsible real estate development does not focus solely on profit at the expense of many other social, community, and environmental factors in order to be economically viable. Real estate developers and communities can in fact work in partnership to produce development projects that create preferred types of long-term value for each stakeholder concerned.
RRED calls the multiple values contained in real estate its Impact Values. Every property has a different set of Impact Values based on its locational and physical characteristics and the potential they can yield for space users, the surrounding community, and the public in general. The key to maximizing such values for a future real estate development is that they should be considered from project conception—with true intentionality to prioritize them, embraced at that beginning stage of a project’s planning. If they are, the “social impact real estate” project can create a positive impact in the communities in which the property is located.
Responsible Real Estate Development Stakeholders:
Developers, Investors & Community Members
Responsible real estate investment is a trend that will only continue in the coming decade. In the 2020 Emerging Trends in Real Estate Report a key trend is environmental and social impacts influence capital deployment. This trend is being championed by socially conscious millennials and the boards of large funds and family offices.
Real Estate development is one of the most sacred of professions. After all, few other professions are so integral to the life, shelter, safety, happiness, and opportunity growth of individuals, families, children, businesses, and communities. Although land is privately owned in our country, it remains part of the community in which it is located. This aspect can never be eliminated, and so it follows that real estate developers should acknowledge an inherent obligation to “do good” for the communities in which they develop properties.
Responsible real estate developments aim is to encourage the creation of projects that are ecologically restorative and socially responsible.
Communities for their part hold the keys to either encourage or discourage responsible real estate development projects. Many communities will take exception to a lack of affordable housing or a national chain developing a project that produces low-wage employment. Conversely, communities that have developer-friendly land use regulation and tax incentives targeting responsible projects are attracting positive social and environmental impact projects. It is up to community members to engage with their city councils and elected officials to encourage policy and land use reform to attract responsible real estate development projects.
Real Estate Development
Shouldn’t we expect more from our “built-environment”?…and from real estate developers? Especially in urban and underserved neighborhoods, shouldn’t good development produce more than just space for rent or sale as a data point in a developer’s pro forma.
Shouldn’t the “built-environment” be designed with intentionality given to how buildings, space, and sites connect to the fabric of the local neighborhood? How they are used to elevate health, wellness, human interaction, and opportunity, and ultimately, enrich lives?
Shouldn’t we be moving forward to develop real estate with authentic community involvement and to use it as a tool to help advance individuals, children, families, and communities?
Isn’t it time we re-define what “real estate value creation” should actually be creating? Shouldn’t we be seeking to maximize multiple real estate values?
Responsible real estate development represents a new and evolving movement in business philosophy. As such, communities, developers, and investors need to prioritize the creation of social and environmental good as goals equal to creating economic returns. By doing such we can change the way people think about real estate development. When we reimagine real estate development we will optimize all such values as a path towards using the “built environment” as a tool to increase opportunity and social equity.
Together we can push the purpose of the “built-environment”. . . creating places that enrich lives thereby helping individuals, families, and children live better lives, producing long-term value for both investors and communities alike locally while making a positive impact on the environment globally.
Take The Responsible Real Estate Development Survey
We welcome developers, investors, and community members to take part in our upcoming RRED surveys. We want to connect developers to socially and environmentally conscious capital sources, connect impact investors to socially and environmentally responsible developments and investment opportunities, and to give communities the tools to encourage the type of projects that will make a difference locally and globally.