Why hotels are getting on board with sustainable development
Global trade policy is shifting, raising questions about the implications for industrial and logistics-related real estate.
For a sizeable number of today’s one billion tourists, the prospect of pristine mountain slopes, sun-drenched beaches and nature at its best is worth traveling long distances for.
Yet for all the good they do for local economies, a steady stream of tourists can also have a significant environmental impact as infrastructure springs up to accommodate their needs while increased water consumption and waste generation put pressure on local resources.
The U.S. Green Building Council (USGBC) estimates hospitality’s annual footprint to total around $4 billion in energy use, 1.2 trillion gallons of water and millions of tons of waste. The global hotel sector, comprising some 175,000 hotels, offering 16.4 million rooms worldwide and generating revenue in the region of $550 billion last year, accounts for around 1 percent of global emissions, on its own.
Inevitably, these numbers support the case for sustainable development. The United Nations has even named 2017 the year of sustainable tourism.
“Sustainable development can only be achieved long-term if we manage to balance economic and social prosperity with environmental integrity,” says Franz Jenowein, Director, Global Sustainability Research, JLL.
The next step for hotels
Hospitality is a competitive marketplace and sustainability is now increasingly mainstream – partly because social responsibility and the environment are becoming more of a focus area within the corporate world.
Jenowein says: “The large chains are very much exposed to corporate peer pressure – in much the same way as companies in other key consumer sectors, such as food or cars – and that is an additional sustainability driver for players in the investible real estate market on the commercial side. Some now have specialist ‘green’ brands, or product lines, as it were.”
Strong sustainability is in the longer-term interests of hotels. As Jenowein points out, the hotel industry is linked to climate change; both as heavy consumers of energy and water, but also because their properties are often located in areas most at risk from the effects.
“More extreme weather events combined with changing climate patterns could not only influence the attractiveness of tourist destinations in the long-term but could also have more immediate impacts on buildings, natural settings and man-made infrastructure,” he says. This in turn can wreak havoc on local economies that have become reliant on predictable tourist income streams.
Siobhan O’Neill, Editor of Green Hotelier, a programme of the International Tourism Partnership (ITP), a charitable membership organisation for leading hotel groups with a combined portfolio of more than 30,000 properties, believes the push towards sustainability is very much coming from those who hold the purse strings within the hospitality industry.
“Although awareness of responsible travel is slowly growing, it’s still very low-level and most people remain oblivious to their own role,” she says. “Corporate clients are definitely influencers, because they’re having to report their own emissions and carbon footprint and demand the information from hotels; but it is investors and markets that are the strongest drivers.”
Green thinking catches on
While hotel chains from Hilton to Marriott are upping their green efforts, it’s new eco-resorts that are grabbing headlines. Hollywood star Leonardo DiCaprio is aiming to create the ‘greenest luxury development ever built’, with the first Living Building standard Restorative Island scheme at Blackadore Caye, off the coast of Belize. Whereas, over in UAE, the Oasis Eco Resort is laying claim to be the ‘world’s greenest’, in advance of its scheduled opening by ‘eco-minded entrepreneurs’ in 2020.
The business travel market is also embracing sustainability – particularly on the conventions circuit, says Dan Fenton, Executive Vice President with JLL’s Hotels & Hospitality Group.
“For meeting planners looking to recommend a hotel or venue destination, sustainability issues are increasingly going to be on the table as part of the decision-making process.”
Furthermore, they will look beyond the glossy websites. “Mere compliance is not enough,” continues Fenton. “Competing for bookings and customer spend, the hotel or venue’s approach to sustainability must be more than just the token ‘box-ticking’ of green issues. Clients want to see evidence of true commitment to the cause, ideally with a splash of creativity on top.
“The policies and passion need to connect with potential customer organizations in terms of their own positions on environmental issues. Today’s customers want to go places that share their values.”
Sustainability initiatives making a difference
Food waste, for example, has become a talking point in the hospitality industry amid growing interest in redistributing surplus food from hotel restaurants and convention centers to people in need. “Red tape around food production and safety regulations has been a problem for years, keeping the volume of food redistributed unbelievably low, even when it was being gifted, not resold,” says Fenton.
“Miami, though, has managed to cut through the bureaucracy. So, food waste has become a strength for communicating sustainability principles of the city’s hospitality players.”
In Chicago, The Hilton Chicago has a rooftop farm growing herbs and vegetables that employs teenagers from less fortunate local communities.
While hotel groups have different priorities on sustainability, a new wave of innovative initiatives is sending a very positive eco-marketing message. Indeed, sustainable development in the hospitality sector is a market of increasing sophistication and rising significance.
As Fenton says: “We are past the ‘please hang up your towels’ phase and have moved into trying to get people to view sustainability in a more holistic way. We want tourists and hotel guests to want to be a part of it. Nowadays, a hotel group’s eco-credentials coupled with a destination’s commitment come into play much earlier in the customer relationship, at the booking stage.
“It’s not enough to have a few low-key green features nowadays. It’s something hotels should use as a positive differentiator to stand out from their competitors.”