ULI: Everybody's Talking About Sustainability, Part II

A comparison was drawn to the automobile industry, which has been a visible target for reducing emissions. The marketing and communications strategies of the car manufacturers has been vocal. But the big difference I see in this analogy is that cars are a consumer product. The information is directed to individuals that respond based on the level of responsibility they take as an individual for their own impact on the environment and they speak in terms of spending decisions. Commercial property is different. It is business to business. People are not sufficiently empowered to make choices about the buildings they occupy for work. They may do in terms of where they shop, but they would sooner think about the sustainability of the products they are buying, rather than the sustainability of the store in which they are buying their products. Inherently, retailers that strive to sell sustainable and socially responsible products are more likely to extend their CSR policy to the buildings they occupy. But certainly, in the difficult economic environment, employees are less able to make decisions about prospective employers based on the buildings in which they will be working. There are opportunities for this to change with increased awareness about “sick building syndrome” and the impact on productivity created by a building and its internal and external environments.

There continues to be a variety of policies, measures, and communications from organisations in the property industry. Some aim for best practice, care little about meeting standards, but rather exceed them. There is merit in having an international standard, which will help convey a consistent measure and message, making it easier for employees, consumers, and investors to understand the choices available to them. It is no surprise that some organisations take measures to make their businesses and buildings greener to enhance their reputation as a way of standing out amongst their peers. Deutsche Bank's eco-refurbishment of their office tower in Frankfurt was one such example. And once again the topic of valuing sustainability and improvements was raised. But certainly return on sustainability goes beyond financial return on investments in the fabric of the building. Surely the cost of irreparable damage to the environment and communities is not one that organisations want to bear? And when will people start to understand the social return on investment? The last breakout session of the day attempted to highlight this.

After a very informative, but data-driven keynote speech by Jean-Pascal van Ypersele, Vice-Chair of the Intergovernmental Panel on Climate Change (“IPCC”), I attended a breakout session about property projects that were a financial success for the developer and also aimed to provide a benefit to society. The session commenced with Dr. Martin Frick from the Global Humanitarian Forum based in Geneva, who put climate change in the context of the impact on human lives. He highlighted the immense loss of life and detrimental effects on people caused by extreme floods, wind storms, and earthquakes. This, to me, was a key piece of the puzzle that attached personal meaning to Mr. Van Ypersele data from the IPCC. Whilst Mr. Van Ypersele aimed to convince the audience of over 130 people that carbon emissions needed to be curbed, Dr. Frick demonstrated why by presenting the impact on people. Strikingly, but not surprisingly, he showed a relationship between high poverty levels in lesser developed countries and the severity of negative impact of climate change disasters. Developed countries also have a higher rate of insured risks compared to developing countries.

The two presentations that followed were intriguing, but I felt only scratched the surface of what is possible in the scope of property development for social benefit. Architect Josef Hohensinn presented a beautifully designed prison in Austria reflecting the stance that prisoners are punished by way of deprivation of civil liberties and should not be punished physical. It was the first newly built prison in Austria since the 1940s and permitted a re-thinking of how a prison should be configured and built. The result was a beautiful building (comment: the quality of which looked like an significant improvement over many subsidised housing properties in East London) that was more efficient and that provided a healthier environment. It was claimed that personnel costs were lower as less monitoring was required as prisoners could move from place to place within the structure and lower healthcare costs for staff, guards, and inmates. The cost to build was the same as for previous prison structures, but observed 25% savings per annum in operating costs.

The second development example was Liverpool One by Grosvenor. The retail-led development sits between the waterfront and existing main retail area in Liverpool in north-west England. Uncovered and spanning 42 acres over roughly four streets, four lanes, and two squares, the development resembles a shopping centre, but developed like a large high street or market square. The development included stakeholder consultations and community engagement, the assembly of 240 land interests, and the collaboration of 30 architects to maintain the architectural character of the city centre area. Mark Curry, Development Manager from Grosvenor reported an increase in the footfall in the city by 24% and in Albert Dock on the waterfront by 48%. It would have been useful to understand better how the consultations were carried out and how the community's needs were catered to. I would be curious to understand the impact the development had on neighbouring retailers, businesses, and residents in terms of the local economy, transportation, cultural and recreational offering, and community integration.

The benefit to society and social sustainability of property is a vital issue and must not be forgotten amongst the resource, carbon, and climate change data. It is undoubtedly difficult to measure, but we cannot afford to ignore it. The topic of sustainability requires a broad view of the various issues that could fall under the umbrella of sustainability. It is not only about data, measurability, standards, and costs, but also changes in attitudes, behaviours, at the group level and also as individuals. It would have be nice to see more time and attention paid to this segment at the conference. Instead as one of the last sessions of the day, it was attended by a small group of 15 delegates, a little more than 10% of the wider audience that was present for the afternoon keynote speech.