No wasted opportunities in real estate

The Savills Blog

No wasted opportunities in real estate

How can the real estate industry tackle global waste, reduce emissions, and create social value?

Friday 20 September 2024 marks the fifth annual World Cleanup Day, a global campaign which unites volunteers, governments and organisations to tackle the worldwide waste crisis. 

Its president, Heidi Solba, explained when we recently spoke to her: “I started this campaign because I saw first-hand the damaging effects of rising pollution in the environment. I wanted to ensure the magnitude of the problem was being realised in the mainstream.” 

“As global economies and populations have increased, the production of materials, including plastics, paper, and construction materials, have risen at astonishing rates in recent decades”, she added. This has not been properly managed, and in turn, has led to increasing pollution in our environment and natural ecosystems.”

Costs to the environment and the bottom line

Outdated and underperforming waste management systems cause damage to the environment, have knock-on effects to human health, and cost global economies an estimated US$360 billion per year, according to a February 2024 report by the United Nations Environment Programme.

Sustainable waste management in real estate construction and the day-to-day operations of commercial real estate play a key role in tackling the problem.

It’s also an important step on the path to net zero carbon. For many commercial occupiers, waste management processes significantly impact their scope 2 and 3 emissions, and are a highly cost-effective way to reduce their footprints.

With ESG performance and reporting increasingly important to corporate tenants, landlords looking to gain a competitive advantage should focus on providing best-in-class waste management solutions that drive sustainability.

Done right, sustainable waste management can also impact the bottom line, reducing procurement and disposal costs. And it can generate social value by improving local areas for tenants and communities.

Opportunities in construction

Construction accounts for around a third of the world's overall waste and over 40% of the world’s carbon emissions, according to the European Commission.

Circular economy principles play an important role in reducing the amount of waste generated in the sector, ensuring construction materials are collected, recycled and repurposed again.

To this aim, the adoption of new AI technologies that recognise materials and streamline recycling processes result in more construction resources being re-used rather than ending up as waste in landfill or incineration facilities.

Choice of building materials is also important. Materials such as sustainable mass timber offer a low-embodied carbon solution that is recyclable for future uses.

Latest solutions for commercial occupiers and landlords

AI is driving new technologies proving useful to occupiers. For example, office tenants have started to install smart bins that identify waste and sort it correctly for recycling, detect when they’re full, and use information to optimise waste collection routes, thereby reducing emissions and costs.

In the hospitality sector, AI helped the Hilton cut buffet breakfast waste by 62%. In a trial, aimed to demonstrate how the hospitality industry can ambitiously cut food waste by 50%, the hotel chain introduced advanced sensors and data analytics to examine breakfast waste. Using the information to adjust menus and layouts, it reduced food waste, lowered costs, and increased customer satisfaction.  

By adopting circular economy principles, food waste from commercial building such as hotels and offices can also be converted into fertilisers or biofuel. 

Over the lifecycle of a property, the prioritisation of sustainable waste management can make a real difference. By embracing circular economy approaches and new technologies, the real estate sector can meaningfully reduce emissions and generate social and environmental value, improving environments for local communities and doing it’s bit to tackle the mounting global waste crisis. 

 

Further information

Contact Sarah Brooks or Scott Porter

IMPACTS: Environment

 

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