Over nearly three years, we have been reminded that the world can turn on a dime. The world has grappled with a global pandemic, waves of political and social unrest with international consequences, and in many countries, the hottest summer since records began. As a result, how we live, work and connect with one another and, subsequently, how we interact with the places and spaces around us has shifted – perhaps forever.
So many of these concerns are unfolding with direct links to the commercial real estate (CRE) industry. After all, CRE is one of the largest contributors to global carbon emissions. While there is a challenge here in helping to prevent carbon emissions from continuing to climb, there is a real opportunity as well – real estate can rally together, on the one hand, to ensure that these emissions are reduced to science-based targets that limit climate change to 1.5ºC, and on the other, to craft resilient spaces for a future impacted by climate change.
To help limit this increase, owners and operators are using ESG as a framework to prioritize initiatives and measure progress. It is only recently, however, that it’s become apparent that ESG alone is not sufficient if we are to prepare our sector for potential future shocks – and therefore the flexibility – that these may demand of us. Enter a fourth factor: Resilience.
Why resilience?
Although a tricky pill to swallow, it’s become increasingly clear that, while it can be slowed and made manageable, we cannot halt climate change in its tracks. When we accept this reality, it then becomes necessary that we create spaces resilient to a warming world, as well as trying to reduce climate change’s scale and rate. This is ESG+R.
In the context of CRE, Resilience can be broken into three main parts, with each denoting the ability to adapt to change whether it be external (environmental or societal) or the flexibility to stay current against constantly evolving technology. These are:
- Resilience of a building itself: how the building’s physical infrastructure can adapt to global challenges like power grid failures and weather-related phenomena. This could include flood prevention in the comms room or back up power for critical systems.
- Resilience of in-building tech: how future-ready the technology is in a building, such as the risk of obsolescence due to technology not being upgradable and/or inoperable. An example of this obsolescence could be deploying an in-building mobile solution that can’t be upgraded to 5G.
- Resilience powered by technology: how much of a long-term impact technology has on a building’s ability to adapt to change. E.g. a shift to flexible working brought about by Covid-19. This may include cloud-based technologies across all IT infrastructure to allow for remote working.
How can technology enable a successful ESG+R strategy?
With ESG+R goals in place, owners and operators face significant pressure to demonstrate that they are tracking and improving against these factors; the consequences of badly reported and underutilized data are significant. If we are to create real estate that has a lasting impact and delivers good outcomes for its users, the technology under the hood needs to gather information that will enable better decisions.
Modern buildings are now so complex that it’s impossible for a human to monitor everything, let alone optimize all these interrelated systems in real-time. The technology in an intelligent building can monitor every data point; over time, it can learn how to balance and optimize every system to make the whole building as efficient and effective as possible.
Is obsolescence the price we have to pay?
For CRE, it’s clear that technology should play a foundational role in delivering ESG+R. Yet it’s important to think about this proactively, rather than reactively. Although we may not like to say it out loud, we are not necessarily going to be able to slow down climate change in our lifetimes. We need to be delivering spaces that minimize emissions and simultaneously ensure they are resilient against climate change. Without using technology to underpin this, there will come a day when we will be left with stranded assets that are unleasable, and so unsellable and – ultimately – unusable.
Interested in how WiredScore can help you with your ESG+R goals? Learn more here.