Sustainable buildings are likely to account for a much higher proportion of professional European investment portfolios in the medium term as investors increasingly recognise that sustainability makes financial sense. Besides developing new green buildings, refurbishing existing buildings with a strong focus on sustainability is an emerging trend. These are among the key findings of Union Investment's Property Investment in Europe study, which polled 185 decision-makers at property companies and institutional investment companies in Germany, France and the UK.
The study shows that 64% of surveyed companies have embedded sustainability criteria into their real estate investment strategies. Despite turbulence in the property investment markets caused by the financial and economic crisis, investor interest in sustainable building remains high: 62% of investors plan to invest significantly more in green buildings in future. French investors in particular are extremely committed in this area. 55% of all respondents intend to invest in developing new green buildings over the next 12 months, while 52% expect to update or refurbish existing holdings soon along sustainable lines. Some 50% of investors surveyed consider sustainable real estate investment to be part of corporate social responsibility. This view is especially pronounced among UK investors, at nearly 60%.
'Compared to the last survey, there is evidence that investors are now more aware of the economic opportunities associated with sustainable building,' said Reinhard Kutscher, chairman of the management board of Union Investment Real Estate. Some 54% of participating property investors agree that users and investors benefit equally from sustainable buildings. In autumn 2009, just 46% of investors saw sustainability as a win-win situation.
The survey findings also suggest that things are gradually improving on the supply side, at least as far as investor perception is concerned. Just under 40% of investors are of the opinion that a market for green buildings has emerged in their country. The reference figure from the last survey was 26%. On the user side, only 33% of European investors see broad-based demand for space in sustainable properties, with the figure being boosted by widespread agreement on the part of French investors (45%). In France, the study noted a particularly strong focus on business aspects of sustainability; the potential of sustainable buildings to form a separate asset class in future was also rated more highly than elsewhere.