Forbes: Commercial Real Estate Faces Valuation Crisis Amid Sustainability Shift
TL;DR: Commercial real estate faces a valuation crisis as standard financial metrics don't account for rising demand for sustainable building practices, even though green building certifications are becoming more prevalent. Over 75% of real estate investors are considering climate risks, given that the built environment is responsible for 30% of global energy consumption and 26% of related CO2 emissions, requiring the industry to modernize.
Key takeaways
- A Forbes report highlights a looming valuation crisis in commercial real estate driven by the increasing demand for sustainable building practices
- Current financial metrics used for property valuation are failing to adequately incorporate sustainability initiatives
- As green building certifications become commonplace, investors are prioritizing verifiable performance outcomes, evidenced by the fact that over 75% of global real estate investors now factor climate risks into their decisions
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