Green premiums vs. brown discounts: Building owners who incorporate sustainable practices experience significant advantages in the market. Properties with green credentials generate more occupier demand and achieve greater rental premiums globally. JLL’s research shows average premiums of over 7% in North America,10% in Asia Pacific, and more than 11% in London. Conversely, properties lacking sustainable practices are experiencing a decline in value, leading to lower rental income and reduced sales prices, these are referred to as "brown discounts." According to a survey conducted by RICS almost 50% of respondents worldwide reported experiencing a brown discount, with significant impacts on the property's overall performance.
Retrofitting and adaptive reuse: Revitalising underperforming spaces through retrofitting and adaptive reuse presents unique opportunities for both building owners and the environment. These practices enable the transformation of dated, underutilized, and energy-inefficient spaces into high-performing structures that align with current market demands and sustainability goals. Retrofitting addresses energy efficiency, functionality, and aesthetics, often involving upgrades to building systems, insulation improvements, and the incorporation of modern energy management technologies. Adaptive reuse caters to the growing demand for repurposed spaces while delivering significant carbon emissions savings. Projects where we were directly engaged such as Heriot-Watt University Dubai's campus and Aldar's headquarters in Abu Dhabi have achieved carbon emissions savings ranging from 40% to 70% when compared to new builds.
By leveraging our broad network and deep industry expertise, JLL provides clients with comprehensive analyses and tailored solutions that demonstrate the financial viability of sustainable initiatives. Global benchmarks and studies allow JLL to quantify the ROI of sustainable real estate, offering clients valuable insights into the potential economic gains associated with energy efficiency, green certifications, and sustainable building practices.
These benchmarks and studies not only highlight the financial advantages, such as lower operating costs, increased rental premiums, and improved market positioning, but they also showcase the positive impact on tenant satisfaction, employee productivity, and overall asset performance.
Through evidence-based strategies and a commitment to sustainability, JLL empowers clients with the knowledge and confidence to make informed decisions that align with their financial goals and environmental values. By emphasizing the compelling ROI of sustainable real estate, JLL encourages clients to embrace green building practices as a smart and profitable investment choice.