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 [Responsible Business &amp; Employee Engagement](/CSR-News/responsible-business-employee-engagement)

 # A Sustainable Investment Case

 

##### By Rebecca Pearce EMEA Head of Sustainability, at CBRE

 

 

 Mar 19, 2015 8:30 AM ET

  Campaign:  [CBRE Environmental Sustainability](/news/campaign/cbre-environmental-sustainability)  ![](https://3blaws.s3.amazonaws.com/styles/carousel_2x/s3/images/cbre_0.jpg "Sustainable Investment Case: CBRE blog") Sustainable Investment Case: CBRE blog 

 

[Originally posted on CBRE's The Green Perspective](http://www.green-perspective.blogspot.co.uk/2015/03/a-sustainable-investment-case.html)

The property industry has been seeking clear evidence of the financial benefits of investing in sustainable property for some time. Identifying a specific value differential associated with sustainability credentials would be useful to justify the commitment of funds to the development of “greener” buildings, or improving the performance of existing stock. So far this has been difficult to define given the complex factors that influence transaction prices such as market cycles, building age, tenant covenant and location. Nevertheless the importance of sustainability for property owners, occupiers and investors has been steadily increasing. CBRE’s 2015 EMEA Investor Intentions Survey bears witness to this trend.

  
The survey of 280 diverse investors active in EMEA shows that a sizeable majority consider sustainability factors in their investment process. 70% of respondents noted that sustainability is either critical, one of the most important criteria or “definitely matters” in the asset selection process. By contrast, only 15% of the overall respondents stated that “sustainability is not a significant consideration in selecting assets to buy”. The results are even more definitive for institutional investors (pension funds, insurance companies and sovereign wealth funds) where 30% noted sustainability as critical or one of the most important criteria (increasing to 83% for the “definitely matters” respondents) and only 3% did not regard it as a significant consideration.  
  
The increased importance for institutional investors is understandable given their traditionally longer investment horizons and greater focus on environmental, social and governance (ESG) risk. Given these factors, we are also seeing questions over asset obsolescence and stranded asset potential weighing more heavily in investment decisions. Alongside increasing regulation and occupier sentiment, this focus is also driving more attention amongst property fund managers. Environmental, Social and Corporate Governance is also part of the pre-acquisition due diligence process which is becoming mainstream.  
  
Projects to improve existing assets are becoming more common with increased access to capital and greater rewards. We are also seeing increased attention on GRESB survey performance from investors and fund managers alike. Some ratings agencies now consider demonstration of an effective ESG management approach as a prerequisite for attaining the highest level of investment rating.  
  
The survey results demonstrate that, while it may be difficult to define value increases or yield impacts, sustainability is clearly on the agenda for investors across EMEA. Coming at a time when market activity is predicted to increase this is great news for a more sustainable built environment.

  
[Results of the full survey can be found here.](http://www.cbre.eu/emea_en/movingmarkets/investor_intentions)



 

 

 

 

 

 

 

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