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Forbes: Commercial Real Estate Faces Valuation Crisis Amid Sustainability Shift
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Heartspace News Desk
•Source: Forbes
TL;DR
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.
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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
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. With the built environment responsible for approximately 30% of global energy consumption and 26% of associated CO2 emissions, the industry faces significant pressure to modernize both asset valuation methodologies and operational strategies.
Related Topics
commercial real estatesustainabilityvaluationclimate riskinvestmentenergy consumption
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