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The real estate industry is going beyond mere brick and mortar by becoming more environmentally conscious and sustainable in the face of climate change and global warming. The real estate sector, whether it is commercial or residential segment, has prioritized the decarbonization of its portfolios sensing the surging demand for sustainable buildings.
The green commercial real estate--characterized by its resource-efficient operation and minimal carbon footprint, has incorporated innovative construction with the integration of state-of-the-art technologies without sacrificing functionality and aesthetic appeal. The real estate practicing ESG to achieve sustainability does not only reduce the environmental impact but also enhance the health and well-being of their occupants.
The green commercial-office spaces are characterized by an array of features such as: energy efficiency, recycled-sustainable construction materials, water efficiency, quality indoor environment, renewable energy sources, and smart building technologies. The paradigm shift in the real estate industry has literally facilitated occupants to interact with their green surroundings.
The sustainable commercial and office spaces have witnessed: reduced energy consumption, lower gas emission, healthier living environments, increased property value, and lower maintenance costs. In a nutshell, green buildings offer not only health advantages but also economic benefits, making them a compelling choice for the future of construction as well as commercial real estate development.
According to the International Energy Agency reports, building constructions are accountable for 36 percent of global energy use and 39 percent of greenhouse gas emissions annually. Undoubtedly, green real estate could significantly decrease these figures with the integration of sustainable practices.
Green commercial real estate is a growing trend in India, especially in Delhi-NCR. According to a Colliers report, the green penetration in India's commercial real estate segment has surged to 61 percent in Q4 2023. The upcoming commercial development is dedicated to align with the ESG principles, indicating a promising trajectory towards sustainability.
According to the report, green-certified Grade A office stock is propelled to surpass 550 million sq ft, accounting for 65-0 percent of the overall office stock in India by 2026. This vividly manifests that green building momentum has taken centerstage in commercial real estate and all stakeholders including -- tenants, investors, developers and regulators -- have recognized the tangible benefits of sustainability and its market value. It has, unambiguously, become the future facade of India's real estate.
The demand for sustainable commercial office spaces is on the rise, prompting developers to seek green building certifications. These certifications enhance the appeal of properties to environmentally conscious tenants. Certification programs such as Leadership in Energy and Environmental Design (LEED) by the US Green Building Council and GRIHA (Green Rating for Integrated Habitat Assessment) assess the environmental impact of buildings from construction through design. They evaluate various aspects such as green infrastructure, low-impact design, UHIE-mitigation designs, use of renewable energy, energy optimization, and water management, all with a focus on the well-being of occupants.
This apart, WELL certification, recognized by the US-based International WELL Building Institute, vets feature like air ventilation, water management, proper light and comfort. It focuses on employee wellbeing. Moreover, the Government of India has charted several programs and incentives which have spurred developers to adopt eco-friendly design and construction practices. Realizing the economic benefits of the green movement in the real estate industry, India has taken giant steps towards sustainability.
All in all, the future of green real estate is bright as property buyers, investors, construction industry players have underlined the benefits of a sustainable economy. Studies show that green-certified buildings enjoy enhanced occupancy rate and command rental premiums, so sustainable commercial spaces and green leasing are deemed as the future of Indian real estate.
Developers in the country are poised to create green buildings which can safeguard the environment for generations to come, matching their needs. Sustainable commercial real estate has become integral for achieving global net zero targets, and India's contribution to this course is praiseworthy and noticeable. The collective action of all stakeholders and supportive government policies have accelerated the green mission of India.
