One of the highlights of the recent World Sustainable Building Conference SB11 in Helsinki was the presentation of initial findings of the Sustainable Investment in Real Estate project to measure the impact of sustainability on the financial performance of European retail and office properties.
S-I-R-E claims its project is the first significant attempt to relate environmental performance to financial parameters in European properties. Although there have been several studies that have looked at the correlation of green buildings to rental rates and investment value—CoStar’s two studies of ENERGY STAR and LEED certified buildings in the U.S. are prominent examples—the S.I.R.E. report is a deeper dive into the ways that carbon reduction affects capital gains and cash flow across a portfolio.
The preliminary report presented in Helsinki suggests that the link between economic and environmental performance is still inconclusive. But gauging from audience reaction and buzz in the corridors at the conference, it is clear that S-I-R-E and the project’s academic and industry co-sponsors are on the right track to establishing that link. It is clear that as the sustainability agenda matures, it will become increasingly important to translate sustainability performance data into criteria and formats usable by the investors.