Sustainable Real Estate
It is estimated that in the UK, the built environment contributes around 40% of the UK’s total carbon footprint. According to the UK Green Building Council, almost half of this is from energy use within buildings and related infrastructure.
While newly constructed buildings are generally more energy efficient, it is estimated that 80% of buildings that will exist in 2050 have already been built, so a major priority over the coming decades will be the decarbonisation of existing building stock.
“Nature-based solutions” (an umbrella term referring to the management and use of nature for tackling socio-environmental challenges) are becoming an increasing feature of the commercial real estate market, from “micro” solutions such as green walls and roofs to larger scale investments in sustainable forestry and other carbon sequestration solutions. Listen to our podcast episode on nature-based solutions.
Macfarlanes can assist clients in managing the wide range of ESG related impacts for the commercial real estate market, including:
- sustainable energy procurement, including onsite, renewable energy facilities;
- environmental law;
- green lease provisions and other innovative bespoke drafting seeking sustainable outcomes;
- development obligations relating to the use of sustainable materials and emerging codes of practice;
- the incorporation of health and wellbeing covenants and benchmarks in leases and development agreements;
- targets for “greener” construction practices onsite, addressing sustainability in pre-contract tenders and projects where off site manufacture is being used;
- data privacy considerations linked to the increased transparency demanded by ESG related reporting obligations;
- ESG related regulation, such as Minimum Energy Efficiency Standards (MEES);
- emerging real estate sectors with an ESG theme (such as life-sciences, largescale nature-based solutions and vertical farming); and
- transactions across the living sector, including in relation to the establishment of joint ventures and investment funds focused on the PRS and BTR markets.